Hazards in Trade Finance: Court of Appeal Considers Issues of Assignment, Set-Off and Competing Agreements

Navigating the course of trade finance is not without its hazards and challenges. Varying trade arrangements and multiplicity of parties often give rise to legal issues and uncertainties. In CIMB Bank Bhd v World Fuel Services (Singapore) Pte Ltd [2021] SGCA 19, the Singapore Court of Appeal had the opportunity to consider such issues of trade finance, including claims under assignment, the resolution of competing contracts, and the right of set-off. 

In this case, the plaintiff bank claimed against the defendant as the alleged assignee of purported debts owing from the defendant to the plaintiff bank’s borrower. The Court had to grapple with a clause precluding the right of set-off contained in the borrower’s standard terms and conditions on one hand and a subsisting offset agreement providing for the right of set-off between the defendant and the borrower on the other hand.

This Update looks at the key points of the Court’s judgment and the issues that should be considered by banks and borrowers alike when entering into trade finance agreements.

For more information, click here to read the full Legal Update.

CONTACTS

Deputy Head, Shipping & International Trade
+65 6232 0383
Singapore, South Asia,
Partner
+65 6232 0655
Singapore,

Country

EXPERTISE

SECTORS

Share

Rajah & Tann Asia is a network of legal practices based in Asia.

Member firms are independently constituted and regulated in accordance with relevant local legal requirements. Services provided by a member firm are governed by the terms of engagement between the member firm and the client.

This website is solely intended to provide general information and does not provide any advice or create any relationship, whether legally binding or otherwise. Rajah & Tann Asia and its member firms do not accept, and fully disclaim, responsibility for any loss or damage which may result from accessing or relying on this website.

© 2024 Rajah & Tann Asia. All Rights Reserved. All trademarks are property of their respective owners.