Singapore: Singapore Implements The UNCITRAL Model Law On Cross-Border Insolvency

Globalisation has been described as an evolving set of consequences – some good, some bad and some unintended. In this regard, when companies go global, insolvency is perhaps the furthest thing from their minds. Yet, while business failure may be unintended, when a global company becomes insolvent or attempts debt restructuring, its insolvency representative e.g. liquidator or manager, will often have to deal with assets and creditors across the globe.

In this regard, to maximise the value of those assets and to prevent a "free-for all, catch-as-catch-can situation"1 as creditors scramble to enforce their claims, an insolvency representative must first procure access to the domestic courts of all the jurisdictions in which the debtor has assets, usually either by an application to recognise the foreign insolvency or by commencing local insolvency proceedings. Even with such recognition, the insolvency representative may have to separately apply to stay legal proceedings in each jurisdiction and then start pursuing claims to recover the debtor's assets.

Cross-border insolvency issues also affect creditors. For example, a creditor would want to know if it can sue the debtor or execute against the debtor's assets in jurisdictions where formal insolvency proceedings have not yet commenced. A creditor would also understandably be concerned about a debtor which is insolvent in one jurisdiction but continuing to trade (or worse, disposing of assets) in another.

It is these issues, amongst others, that the UNCITRAL Model Law on Cross‑Border Insolvency ("the Model Law"), seeks to address. The Model Law's stated purpose is to assist states to equip their insolvency laws with a modern, harmonised and fair framework to address more effectively instances of cross-border insolvency proceedings.2Introduced in 1997 and since adopted by 43 states in 45 jurisdictions,3 the Model Law has finally been implemented in Singapore on 23 May 2017, through the Companies (Amendment) Act 2017 ("the Amendment Act").

Singapore law prior to the amendment

Prior to the Amendment Act and the implementation of the Model Law, the position in Singapore was articulated by the Court of Appeal in Beluga Chartering GmbH (in liquidation).4 In that case, the Court of Appeal observed that (a) Singapore courts were not bound to recognise any foreign insolvency proceedings; and (b) whether or not a Singapore court would exercise its inherent jurisdiction to render assistance to foreign insolvency proceedings through regulation of its own proceedings would depend on the particular circumstances before it. In other words, each application to recognise a foreign insolvency proceeding would be dealt with on an ad-hoc, case-by-case basis.

The subsequent High Court decision in Re Taisoo Suk5 was the first case where a Singapore court exercised its inherent jurisdiction and recognised foreign insolvency proceedings. This case concerned an ex-parte application by a foreign representative of Hanjin Shipping for the Singapore courts to recognise the South Korean rehabilitation proceedings and grant a stay and moratorium of all proceedings against Hanjin's subsidiaries and vessels in Singapore. The High Court applied various considerations in deciding to grant the orders sought, including the foreign proceedings' impact on domestic creditors and whether it was fair and equitable in the circumstances to give recognition. Ultimately, the High Court granted the orders sought, on an interim basis, after a single ex-parte hearing.

In the more recent February 2017 applications by member companies of the EMAS group for recognition of the group's US Bankruptcy Code Chapter 11 proceedings in Singapore, the Singapore High Court ultimately recognised the Chapter 11 proceedings to the extent of allowing a limited stay and moratorium against proceedings in Singapore. No grounds of decision were issued for the EMAS applications and therefore, it is not apparent what considerations the High Court applied. However, it is noted that the High Court allowed the stay and moratorium only after seven hearings and only upon (arguably) onerous undertakings being given by the applicant companies to keep interested parties continuously notified of all developments in the Chapter 11 proceedings.

The two High Court decisions above, while ultimately recognising the foreign insolvency proceedings, showcase the issues with an ad-hoc approach. In one case, the court granted the recognition, without undertakings, after a single hearing but in the other, it took several hearings and substantive undertakings being given before recognition was granted. Against the backdrop of these cases, a foreign insolvency representative would be understandably uncertain about the approach he should take to procure recognition. Uncertainty inevitably increases the cost of insolvency administration and reduces the assets available to the creditors. There is therefore a clear need for certainty and predictability in the law regarding recognition of foreign insolvency proceedings.

Legal position under the amended Act

The Model Law aims to provide such certainty by providing a transparent, globally-accepted legislative framework for (a) access to local courts for foreign insolvency representatives; (b) recognition of certain orders issued by foreign courts; (c) relief to assist foreign insolvency proceedings; and (d) cooperation among the courts of states where the debtor's assets are located.

In 2013, the Insolvency Law Review Committee recommended the adoption of the Model Law. It has taken three years for the Model Law to be finally implemented in Singapore. Now, at last, Section 41 of the Amendment Act implements the Model Law and gives it the force of law in Singapore.

Under the Model Law, a foreign representative6 can apply to the Singapore High Court for recognition of foreign insolvency proceedings. The application must be accompanied by (a) a certified copy of the decision commencing the foreign insolvency proceedings and appointing the foreign representative; and (b) a statement identifying all insolvency proceedings in respect of the debtor that are known to the foreign representative.

Recognition is largely a formalistic process and generally, upon an application being made by a foreign representative in the proper form, foreign insolvency proceedings will be mandatorily recognised. However, the Model Law does make a distinction between recognition of the foreign insolvency proceedings as either a main proceeding or a non-main proceeding, with each engendering different reliefs and consequences.

A main proceeding is one taking place where the debtor had its centre of main interests ("COMI"). This is presumed to be the registered office or habitual residence of the debtor. However this is a rebuttable presumption and the debtor's COMI does not always coincide with its place of registration.7   The effect of a foreign insolvency being recognised as a main proceeding includes (a) stays of actions or enforcement proceedings by individual creditors against the debtor or its assets; and (b) a suspension of the debtor's right to transfer or encumber its assets. These reliefs flow automatically upon recognition of foreign insolvency proceedings as a main proceeding.

In contrast, a non-main proceeding is one taking place where the debtor has an "establishment", defined as "any place of operation where the debtor carries out non-transitory economic activity with human means and goods or services." When foreign insolvency proceedings are recognised as a non-main proceeding, separate applications must be made to a Singapore court for appropriate relief. In such cases, relief would only be granted if the court is satisfied that the interests of the creditors and other interested persons are adequately protected.

The reason for the distinction between main and non-main proceedings is obvious. In principle, a main proceeding (of which there can be only one) is expected to have principal responsibility for managing the insolvency of the debtor. Therefore, the Model Law accords proceedings commenced in that location greater deference and more immediate, automatic relief. Other states in which the debtor has assets are expected to recognise and support the main proceedings.


In the short term, the implementation of the Model Law will streamline the process of recognising foreign insolvency proceedings in Singapore, thereby reducing the cost in insolvency administration and increasing asset recovery for creditors. In the longer term, with the assurance of more certain and efficient cross-border recognition, companies may be incentivised to site their restructuring in Singapore and in this regard, structure their business such that their COMI becomes Singapore. In turn, this should lead to increased foreign investment into Singapore. 

It is well publicised that Singapore seeks to become a regional hub for restructuring and insolvency administration. Amongst other benefits, this will allow Singapore to supplement and leverage its existing strengths, particularly in dispute resolution, which is frequently insolvency's handmaiden. To this end, the implementation of the Model Law is a big step in the right direction.


1 Re Taisoo Suk (as foreign representative of Hanjin Shipping Co Ltd) [2016] 5 SLR 787

2 Details can be found in the UNCITRAL's Guide to Enactment and Interpretation of the UNICTRAL Model Law on Cross-Border Insolvency.

3 The full list can be found at

4 Beluga Chartering GmbH (in liquidation) and others v Beluga Projects (Singapore) Pte Ltd (in liquidation) and another (deugro (Singapore) Pte Ltd, non-party) [2014] 2 SLR 815

5 Re Taisoo Suk (as foreign representative of Hanjin Shipping Co Ltd) [2016]5 SLR 787

6 A 'foreign representative' is defined under the Model Law as 'a person or body, including one appointed on an interim basis, authorised in a foreign proceeding to administer the reorganisation or the liquidation of the debtor's property or affairs or to act as a representative of the foreign proceeding'.

7 The determination of COMI has spawned a substantive body of case law and it is not the subject of this article to discuss the various considerations to be applied.

Singapore Implements The UNCITRAL Model Law On Cross-Border Insolvency

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions