Illegality and its Impact on Running Accounts in Complex Commercial Relationships
The more complex a commercial relationship, the more difficult to untangle when disputes arise – this was the issue faced in the Singapore High Court case of Deepak Mishra and another v Rashmi Bothra [2025] SGHC 170. The Claimants and the Defendant in this case had a long-running commercial relationship, in which they established a Running Account involving numerous financial transactions between them and their respective companies. When disputes arose between the parties, they sought to claim against each other for substantial sums owed under the Running Account. This was further complicated by the Claimants’ unpleaded allegations – which arose in the midst of the trial – that certain transactions were illegal, rendering the entire Running Account unenforceable.
The Court held that ultimately the Defendant was owed a sum of US$71,321,679.83 under the Running Account, finding that the unpleaded allegations of illegality did not taint the entire Running Account. The decision demonstrates the Court’s methodical approach to deciphering commercial relationships, and how illegality may affect the enforceability of transactions in the context of running accounts.
The Defendant was successfully represented by Partner Vikram Nair, Senior Associate Ashwin Menon, and Associate Han Xin Yi from the Commercial Litigation Practice.
For more information, click here to read our Legal Update.
Reconciling Insolvency and Arbitration: SIAC Launches Restructuring and Insolvency Arbitration Protocol
By nature, insolvency involves the public centralisation of disputes, utilising a standard statutory framework. Arbitration, on the other hand, prioritises flexibility and party autonomy, providing for the decentralisation and privatisation of dispute resolution. However, parties are increasingly finding arbitration an effective tool to save time and costs for larger and more complex restructuring proceedings, giving rise to conflicts between the insolvency and arbitration regimes.
To reconcile the two, the Singapore International Arbitration Centre (“SIAC“) launched the SIAC Restructuring and Insolvency Arbitration Protocol (“Protocol“) on 26 August 2025, which took effect on the same day. The Protocol introduces a specially designed mechanism for the resolution of restructuring and insolvency-related disputes that parties may choose to adopt. Essentially, the Protocol adapts SIAC’s Arbitration Rules (“SIAC Rules“) for the time being in force with modifications to increase efficiency and reduce the time taken for the arbitration. Its key features include:
- the truncation of certain timelines in the existing SIAC Rules, such as for the filing of the response to the notice of arbitration and for the nomination of arbitrators;
- aligning with the restructuring and insolvency context by way of prompting tribunals to consider questions of joinder of third parties or potential jurisdictional challenges, among other matters;
- specifying a default seat of arbitration and governing law; and
- providing that a sole arbitrator shall be appointed by default.
In this Update, we delve into the applicability of the Protocol and its key features, together with complementary tools such as model clauses for parties’ adoption and the creation of the SIAC Specialist Panel for Restructuring and Insolvency Disputes (“Panel“). Rajah & Tann Partner Sim Kwan Kiat (Deputy Head, Dispute Resolution Group; Partner, Restructuring & Insolvency), is among the specialists listed on the Panel.
For more information, click here to read our Arbitration Asia article.
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Climate Reporting Timelines Extended for Listed Issuers by Tiers from FY 2025, Large Non-Listed Companies to Follow from FY 2030
To support companies in developing climate reporting capabilities, on 25 August 2025, the Accounting and Corporate Regulatory Authority and the Singapore Exchange Regulation (“SGX RegCo“) announced that they have extended the timelines for implementing climate reporting (including external assurance) requirements as follows:
- introducing tiered reporting timelines for issuers listed on the Singapore Exchange Securities Trading Limited (“listed issuers“) from the financial year (“FY“) 2025; and
- implementing reporting timelines for 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 from FY2030 (instead of FY2027).
All listed issuers will continue to report Scope 1 and 2 greenhouse gas emissions (“GHG“) from FY commencing on or after 1 January 2025, while Straits Times Index constituents will continue to lead efforts to implement other International Sustainability Standards Board-based climate-related disclosures from FY2025 and Scope 3 GHG emissions from FY2026.
For more information, click here to read our Legal Update.
SGX RegCo has since announced that it will be publishing a timetable of its expectations for climate reporting. The timetable will break down the climate disclosure requirements and show how listed issuers can progressively meet these requirements over the extended timeline. For more information, please refer to our September 2025 Newsbytes article titled “S-REITs: Unlocking Value and ROFR as a Core Safeguard, Additional SGX Listing Rule Consultations, and Upcoming Timetable for Climate Reporting“
Singapore and Thailand Sign Implementation Agreement on Article 6 Carbon Credits
On 19 August 2025, Singapore signed its first Implementation Agreement on carbon credits collaboration under Article 6 of the Paris Agreement with an Association for Southeast Asian Nations (ASEAN) country, namely Thailand (“Implementation Agreement“).
Key features of this Implementation Agreement are as follows:
- Creation of a framework for the generation and transfer of carbon credits from carbon mitigation projects aligned with Article 6 of the Paris Agreement.
- Correspondingly adjusted carbon credits authorised under this Implementation Agreement may be used for various purposes, such as:
- to offset up to 5% of a company’s taxable emissions under Singapore’s International Carbon Credits (ICC) framework from 1 January 2024, subject to eligibility; and
- to comply with binding mandates such as Nationally Determined Contributions (NDCs) and other international mitigation purposes, e.g. the requirements under the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA).
- Singapore has committed to channelling the value equivalent to 5% share of proceeds from authorised carbon credits towards climate adaptation measures in Thailand.
- As a contribution towards a net reduction of global emissions, Singapore is committed to having 2% of the correspondingly adjusted carbon credits authorised under this Implementation Agreement cancelled at first issuance. These carbon credits that are cancelled cannot be sold, traded, or counted towards any country’s emission targets.
For more information, click here to read our Legal Update.
Changes to Stamp Duty, Additional Conveyance Duties for Sellers of Residential Properties
On 3 July 2025, the Ministry of Finance announced changes to the Seller’s Stamp Duty (“SSD“) regime for residential properties. These apply to all residential properties purchased on or after 12.00 am on 4 July 2025.
The changes impact both the holding period and the applicable SSD rates and are intended to address the increase in the number of private residential property transactions with short holding periods. The Additional Conveyance Duties for Sellers (ACDS) have likewise been revised to reflect these changes.
For more information, click here to read our Legal Update.
MAS Seeks Feedback on Enhancements to Product Highlights Sheet Requirements and Complex Products Framework
On 1 July 2025, the Monetary Authority of Singapore sought feedback on proposals to enhance the requirements for the Product Highlights Sheet (“PHS“) and to streamline the framework for complex products. Its proposals are set out in the Consultation Paper on “Enhancements to Product Highlights Sheet Requirements and the Complex Products Framework”.
Part I: Enhancements to the PHS
- Revised PHS templates – design and content enhancements
- Alignment of PHS-related legislation
- New PHS requirements for Investment-Linked Policies
Transition period: Six months from the effective date of legislative amendments for financial institutions to implement the PHS requirements.
Part II: Enhancements to Complex Products Framework
- Enhanced disclosures and simplified nomenclature for complex products
- Streamlined distribution safeguards for complex products
Transition period: Six months starting from the effective date of the amended Notices to implement the new requirements for the Complex Products Framework.
The consultation period ended on 1 September 2025. For more information, click here to read our Legal Update.
Protecting Your Confidential Information – Lessons from Data Protection and Employment Perspectives
The protection of confidential information continues to be a thorny issue for employers, particularly in the modern context where such information is generally digitally stored, requiring both contractual and data protection. This was brought to the forefront in the Singapore High Court case of Hayate Partners Pte Ltd v Rajan Sunil Kumar [2025] SGHC 41, where an employee had accessed and downloaded a large number of his employer’s files, and had retained them after the termination of his employment.
The Court’s decision clarified the interplay between contract and equity, including whether a court can impose additional or more extensive obligations of confidentiality in equity beyond those provided in the employment agreement. The facts of the case also demonstrate the practical issues involving cloud storage and information technology security policies.
For more information, click here to read our Legal Update which provides a summary of the Court’s decision and highlights the key takeaways for businesses looking to protect their corporate documents and confidential information.
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
