Vol 15 (2018) - Issue 2

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'Super-Priority' and the Singapore Scheme: The Attilan Case

1. Introduction

In early 2017, Singapore took a number of key steps towards positioning itself as the regional centre for international debt restructurings, an ambition its Government has had for some time now. The result has been the introduction of amendments to the corporate legislation framework to enhance the workings of the scheme of arrangements, seen as being the tool par excellence for restructurings, and to introduce crossborder mechanisms to secure cooperation between courts in Singapore and elsewhere. Other measures to come will target improvements to the court service and strengthen professional services in the area and will accompany the increased promotion of ADR facilities on the island. As will be noted below, the amendments to the law focused largely on the scheme of arrangements, which in its use on the island displays similarities to the procedural framework and jurisprudence applicable elsewhere, with the notable exception of the facility for applying for a moratorium to protect the scheme process from interference by creditors. The changes introduced in 2017 potentially take the scheme structure and practice further away from the Singaporean common law framework normally in use on the island. This is for the simple reason that the legislators chose to introduce provisions based on practice in the United States, whose laws are significantly different. The first case under some of the new provisions reflective of American practice has highlighted some of the difficulties involved when hybrid-rules are created that are not wholly consonant with previous domestic practice. The judgment has shown that care needs to be taken in how the courts interpret provisions, not solely in light of the evident examples of foreign law and practice available to follow, but also on whether adopting these interpretations or others will serve to enhance local law and practice.