Mandatory Climate Reporting for Listed Issuers from FY 2025, and Large Non-Listed Companies to Follow from FY 2027
On 28 February 2024, the Accounting and Corporate Regulatory Authority (ACRA) and the Singapore Exchange Regulation (“SGX RegCo“) announced details of mandatory climate-related disclosure (CRD) for:
- issuers listed on the Singapore Exchange Securities Trading Limited (“SGX-ST“) (“listed issuers“) from financial year (“FY“) 2025; and
- large non-listed companies limited by shares with annual revenue of at least S$1 billion and total assets of at least S$500 million (unless exempted) from FY 2027.
The new requirements are part of a finalised climate reporting and assurance implementation roadmap set out in the Response paper (available here). It follows from consultations on the recommendations from the Sustainability Reporting Advisory Committee.
SGX RegCo separately conducted a public consultation on its proposed amendments to the listing rules of the SGX-ST to implement the above recommendations, as set out in its Consultation Paper on “Sustainability Reporting: Enhancing Consistency and Comparability” issued on 7 March 2024. The consultation closed on 5 April 2024.
For more information, click here to read our Legal Update.
Business Collaborations for the Greener Good: CCCS Issues Environmental Sustainability Collaboration Guidance Note
Competition benefits consumers. However, there may be instances where business competitors need to collaborate for the greater, or greener, good. Seeking to achieve net-zero emissions by 2050 under the Singapore Green Plan 2030, Singapore has embarked on a whole-of-nation sustainability movement. The Competition and Consumer Commission of Singapore (“CCCS“) recognises that the sustainability movement may involve business competitors engaging in various forms of collaborations in existing, emerging or new markets in pursuit of environmental sustainability objectives.
On 1 March 2024, CCCS issued its Guidance Note on Business Collaborations Pursuing Environmental Sustainability Objectives, otherwise known as the Environmental Sustainability Collaboration Guidance Note (“ESCGN“), which provides additional guidance on the application of section 34 of the Competition Act 2004 (“Competition Act“) to business collaborations in the context of environmental sustainability initiatives. The ESCGN should be read together with CCCS’s Guidelines on the Section 34 Prohibition and Business Collaboration Guidance Note.
For more information, click here to read our Legal Update.
Four Southeast Asian Stock Exchanges Unite to Develop ASEAN-Interconnected Sustainability Ecosystem
On 15 February 2024, Bursa Malaysia Berhad (Bursa Malaysia), Indonesia Stock Exchange (IDX), The Stock Exchange of Thailand (SET), and Singapore Exchange (SGX Group) (collectively, “Participating Exchanges“) announced their team-up to jointly develop the ASEAN-Interconnected Sustainability Ecosystem (“ASEAN-ISE“). The initiative seeks to promote the Association of Southeast Asian Nations’ (“ASEAN“) sustainable development “through the implementation of common ESG metrics in their respective data infrastructures.”
The intended outcomes of the ASEAN-ISE include:
- Creating an integrated environmental, social, and governance (“ESG“) ecosystem to promote sustainability in ASEAN;
- Enabling Participating Exchanges to reap the benefits of economies of scale through cost efficiency and speedy time-to-market with fit-for-purpose solutions; and
- Empowering Participating Exchanges to assist ESG-compliant companies in enhancing business value through quality disclosures.
The Participating Exchanges agreed to certain deliverables under the collaboration that will take into account local considerations and the maturity levels of the Participating Exchanges’ respective markets. Notably, they have committed to integrate in their respective ESG reporting platforms the “ASEAN Exchanges Common ESG Metrics“, a published set of ESG metrics recommended for disclosure by listed companies.
The Participating Exchanges will reconvene in July 2024 to finalise the implementation details of the ASEAN-ISE initiative.
Singapore and Indonesia Sign LOI to Work on Cross-border Carbon Capture and Storage
In a press release posted on its website on 15 February 2024, the Ministry of Trade and Industry Singapore announced that Singapore and Indonesia have signed a Letter of Intent (“LOI“) to work together on cross-border carbon capture and storage (“CCS“). This follows the issuance on 30 January 2024 of Indonesia’s presidential regulation on CCS allowing CCS operators to reserve storage capacity for foreign carbon dioxide. Click here to read our Legal Update on Indonesia’s regulatory framework on CCS.
CCS involves capturing, transporting and storing carbon dioxide that is produced as a byproduct from other activities, such as power generation. The carbon dioxide that is captured will therefore not be released into the atmosphere. CCS provides a pathway to decarbonise hard-to-abate sectors such as energy and chemicals (E&C) and power sectors, and is one of the key tools to achieve both countries’ respective net-zero emission targets to mitigate the effects of global warming.
The LOI, the first of its kind in Southeast Asia, reflects the commitment of both countries to achieve regional decarbonisation outcomes in a sustainable manner.
A working group will be formed to develop a legally binding bilateral agreement relating to the details of the cross-border CCS cooperation.
ASEAN Issues Guide on AI Governance and Ethics
The rapid growth of artificial intelligence (“AI“) has shone a light on the pressing need to manage its development and inherent risks. While AI solutions bring significant transformative potential, governments have been seeking to establish national frameworks within which AI development and deployment can be duly monitored and controlled. One of the challenges of such AI frameworks is that they are often jurisdiction-specific, while the propagation of AI commonly crosses national boundaries, resulting in potentially differing standards and requirements. Governments have thus been looking towards greater cooperation in AI framework building and standards equivalence to provide for more efficiency in cross-border AI deployment.
In this regard, the Association of Southeast Asian Nations (“ASEAN“) member states have issued the ASEAN Guide on AI Governance and Ethics (“ASEAN AI Guide“), which was unveiled at the 4th ASEAN Digital Ministers’ Meeting on 2 February 2024. The ASEAN AI Guide establishes common principles and recommends best practices on the implementation of trustworthy AI in ASEAN. It seeks to help promote consumer confidence and facilitate cross-border deployment of AI services and solutions throughout the ASEAN region.
The ASEAN AI Guide sets out seven guiding principles which aim to ensure trust in AI and the design, development, and deployment of ethical AI systems:
- Transparency and Explainability;
- Fairness and Equity;
- Security and Safety;
- Robustness and Reliability;
- Human-centricity;
- Privacy and Data Governance; and
- Accountability and Integrity.
For more information, click here to read our Legal Update.
Singapore and China Sign Three MOUs to Strengthen Business Ties
In its 1 February 2024 press release, the Singapore Business Federation (“SBF“) announced that Singapore and China had hosted the Singapore-China Economic Partnership Conference, during which time three Memoranda of Understanding (“MOUs“) were signed. The MOUs aim to enhance the business relationships, intellectual property protection, and mediation and arbitration support in these two countries. The conference, attended by business leaders and government officials, also explored new opportunities for trade and investment between Singapore and China.
The scope of the three MOUs are as follows:
- The first MOU prioritises the facilitation of business activities to encourage the advancement of commercial and industrial relations between Singapore and China. It was renewed by SBF and the China Council for the Promotion of International Trade (“CCPIT“).
- The second MOU focuses on providing capacity-building support for enterprises from China and Singapore in intellectual property protection, management, and dispute resolution. This was signed by the Singapore Manufacturing Federation (SMF) and CCPIT Commercial and Legal Service Center.
- The third MOU, together with the Joint Declaration on the Provision of Legal Services for Regional Economic Development (“Joint Declaration“), seeks to offer businesses from both countries support for mediation and arbitration as an alternative mode of dispute resolution to foster trade and investment cooperation in the region. The MOU was signed by the CCPIT Commercial Legal Service Centre and Singapore International Mediation Centre (“SIMC“), while the Joint Declaration was signed by SIMC, Singapore Chamber of Maritime Arbitration (SCMA), Singapore International Arbitration Centre (SIAC), CCPIT Mediation Center, China Maritime Arbitration Commission (CMAC), and China International Economic and Trade Arbitration Commission (CIETAC).
The signing of the three MOUs demonstrates the deepening economic ties and the commitment of both Singapore and China to foster stronger bilateral relations.
Malaysia and Singapore Sign MOU to Boost Economic Cooperation through Johor-Singapore Special Economic Zone
On 11 January 2024, Malaysia and Singapore signed a Memorandum of Understanding (“MOU“) to work on a Johor-Singapore Special Economic Zone (“JS-SEZ“) to strengthen economic connectivity and cooperation between Johor and Singapore.
Under the MOU, Malaysia and Singapore have agreed to work towards improving cross-border flows of goods and people and strengthening the business ecosystem within the JS-SEZ to support investments. The JS-SEZ rides on the improved growth of Johor and Singapore’s substantial investment in the region.
Aside from the MOU, the two countries will also look into various initiatives aimed at developing the JS-SEZ, including the following:
- Establishment of a one-stop business/investment service centre in Johor to streamline the application processes for licences needed to establish a business presence in Johor by Singapore entities;
- Adoption of a passport-free QR code clearance system to expedite clearance of people at the land checkpoints, as well as digitised processes for cargo clearance at the land checkpoints;
- Holding an investors’ forum to seek feedback on the JS-SEZ;
- Facilitating Malaysia-Singapore renewable energy cooperation in the JS-SEZ;
- Developing training modules to address talent and skills gaps for relevant industries in the JS-SEZ; and
- Organising joint events between Johor and Singapore to promote investment into the JS-SEZ.
When is Three a Crowd: Can a Stranger to an Arbitration Participate in Enforcement Proceedings for the Award?
In general, only the parties to an arbitration may participate in proceedings to enforce the resulting arbitral award. Are there exceptions to this? If so, under what circumstances can a third party apply to be added to the enforcement proceedings? What legal test should be applied under Singapore’s new Rules of Court 2021 (“ROC 2021“)? If the third party is unsuccessful in its application, when should the Court exercise its discretion to allow the third party to be added as an interested non-party instead?
These issues arose for consideration in DFD v DFE and another [2023] SGHCR 23, where an unsecured creditor (“Trustee“) of a party to the arbitration sought to be added to proceedings to resist enforcement of an arbitration award (“Enforcement Challenge Application“). The addition was opposed by the claimant, i.e. the party which had successfully obtained permission from the High Court to enforce the award on an ex parte basis.
The Court considered the approach to be taken under the ROC 2021, finding that the existing case law relating to the Rules of Court 2014 (ROC 2014) continued to be relevant. It therefore had to determine whether it was “just and convenient” for the Trustee to be added, which involved whether the Trustee had a sufficient legal interest in the present proceedings. Ultimately, the Court held it was not appropriate to allow the addition of the Trustee as either a party or an interested non-party to the Enforcement Challenge Application.
The Claimant was successfully represented by Kelvin Poon, SC, Head of the International Arbitration Practice, and Devathas Satianathan from the same Practice, as instructed counsel.
For more information, click here to read our Arbitration Asia article.
Please note that whilst the information in this Update is correct to the best of our knowledge and belief at the time of writing, it is only intended to provide a general guide to the subject matter and should not be treated as a substitute for specific professional advice
