A comparative analysis between Singapore and Bangladesh with regards to

the legislative frameworks for arbitration.

For the purpose of this comparative study of the legislative frameworks for arbitration
of Bangladesh, Hong Kong and Singapore this write up shall be divided into four
main sections. They are as follows:

Section 1 Framework of Arbitration in the countries

Section 2 The Arbitral Processes in the countries

Section 3 Arbitral Awards

Section 4 Comparative analysis of enforcement of arbitral awards in both the

countries.

SECTION 1 FRAMEWORK OF ARBITRATION

Singapore

1.1 Two separate legal regimes govern the conduct of arbitration in Singapore.
Domestic arbitration is governed by the Arbitration Act (“AA”) which came into force
on 1 March 2002. The Arbitration Act applies to any arbitration where the place of
arbitration is Singapore and where Part II of the International Arbitration Act (IAA)
does not apply. For international arbitration agreements, the applicable statute is the
IAA which applies to international arbitrations as well as non-international arbitrations
where parties have a written agreement for Part II of the IAA and the Model Law to
apply (Section 5(1) IAA).

1.2 The distinction between the two legal regimes primarily lies in the degree of
court intervention in the arbitral process and respect for party autonomy. Under the
international arbitration regime, court intervention is limited and restricted to
instances expressly provided by law. The court does not possess any residual power
to grant an application which the law does not expressly provide. There are also
limited instances of recourse against the arbitral award under the IAA. By
comparison, under the Arbitration Act, a party may appeal on a question of law
arising out of the award by agreement of the parties or with leave of court ( Section
49 of the AA).

1.3 The operation of the dual-track arbitration regime in Singapore allows the
parties the facility of opting into or out of a particular regime when so agreed by
them. Thus, the parties may specifically “opt out” of the regime which would
otherwise be applicable by the terms of the respective Acts by referring to the

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arbitration regime (IAA or the Arbitration Act) that they wish to “opt into” in their
arbitration agreement. (Section 5(1) and Section 15 (1) of the IAA).

Hong Kong

1.4 The Arbitration Ordinance (Chapter 341) was enacted in 1963 and was
amended in 1975. The court's role is laid down in the Ordinance. It has discretion to
stay court proceedings where there is a domestic arbitration agreement, a stay being
mandatory for a non-domestic agreement. It has the power to remove an arbitrator
due to misconduct. It can assist in the conduct of arbitrations by making appropriate
orders, such as those for discovery of documents. Further it has power, through the
special case-stated procedure, to review any award and to determine any question
of law arising in the course of a reference. There are many other less important
provisions dealing with arbitrations in Hong long, some of which are subject to any
contrary intention in the arbitration agreement.

Bangladesh

1.5 “The Arbitration (Protocol and Convention) Act 1937” and the “Arbitration Act
1940” passed by the United Kingdom Parliament contained the legal framework for
arbitrations during the times of the British India and continued at the time of
independence of Pakistan and India in 1947 in those countries and in Bangladesh at
the time of its independence in 1971. These statutes were repealed by the
Arbitration Act 2001 (“ the Act ”) and it contains the present legal framework for all
arbitrations in Bangladesh whether international or domestic.

1.6 Section 3(1) of the Bangladesh Arbitration Act 2001 provides that this Act
applies to all arbitrations taking place in Bangladesh. Provisions as to the recognition
and enforcement of foreign arbitral award are contained in sections 45 and 46 of the
Act. With regard to foreign arbitral award the only exception is there within the
discretion of the Government in respect of certain state to be declared as specified
and notified in the official Gazette as contemplated in section 47.

SECTION 2 THE ARBITRAL PROCESSES

Singapore

2.1 If the arbitral tribunal rules as a preliminary question, that it has jurisdiction,
that decision is subject to a review by the High Court. (Art. 16(3) Model Law, IAA,
read with Art.6, Model Law IAA and Sect.8 (1), IAA & Section 2 and 21(9) of the
Arbitration Act 2002 (Singapore)). A decision by the tribunal that it has no jurisdiction
is not subject to such a review as such a decision is not an “award’ which is subject
to appeal or setting aside by the court( PT Asuransi Jasa Indonesia (Pereso) v Dexia
Bank SA [2007] 1 SLR 597 (CA)).

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2.2 The Arbitration Act and the IAA both provide for the stay of court proceedings
which are commenced in breach of such agreements. The concept of a “stay”
operates effectively to suspend court proceedings by the court’s restraint in
exercising jurisdiction over the matter. Like courts in many common law jurisdictions,
courts in Singapore takes the view that an arbitration agreement does not
automatically oust the court’s jurisdiction and would not dismiss the cases brought
before them, unlike in many civil law jurisdictions, where would dismiss the actions or
decline to exercise jurisdiction. The power to grant stay under the Arbitration Act is
discretionary (Section 6, Arbitration Act). However, the court’s power under IAA is
not discretionary and the court must grant a stay if the conditions are fulfilled and
direct the parties to proceed to arbitration unless the “the arbitration agreement is
null and void, inoperative or incapable of being performed” (Section 6(2), IAA).

2.3 Where the court orders a stay, the court may issue orders in relation to the
property subject to the dispute for the purpose of preserving the rights of the parties.
(Sect. 6(3) IAA; Sect. 6(3) Arbitration Act).

Hong Kong

2.4 Under Sect.13B of the Arbitration Ordinance 1963 the arbitral tribunal may
determine its own jurisdiction. Article 16 of the Model law has been adopted like in
the case of Singapore.

2.5 Section 6 of the Arbitration Ordinance 1963 provides that if a party to an

arbitration agreement that provides for the arbitration of a dispute involving a claim or
other matter this is within the jurisdiction of the Labour Tribunal or a person claiming
through or under such a party, commences legal proceedings in any court against
any other party to the agreement or any person claiming through or under that other
party, in respect of any matter agreed to be referred, and any party to those legal
proceedings applies to that court after appearance and before delivering any
pleadings or taking any other step in the proceedings, to stay the proceedings, the
court or a judge of that court may make an order staying the proceedings, if satisfied
that-
(a) there is no sufficient reason why the matter should not be referred in accordance
with the agreement;
and
(b) the applicant was ready and willing at the time the proceedings were commenced
to do all things
necessary for the proper conduct of the arbitration, and remains so.

2.6 Section 2GB of the Arbitration Ordinance provides the general power of the
arbitral tribunal which includes directing the inspection, photographing, preservation,
custody, detention or sale of the property by the tribunal.

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Bangladesh

2.7 Arbitration Tribunal is empowered under section 17 of the Arbitration Act 2001
to give decision on any question as to its jurisdiction including whether there is a
valid arbitration agreement or whether the arbitration tribunal is properly constituted
or whether the arbitration agreement is against the public policy or whether the
arbitration agreement is incapable of being performed or whether the matters have
been submitted to arbitration in accordance with the arbitration agreement. Section
19 provides for raising objection by a party to the arbitration proceedings against the
arbitration tribunal as to having no jurisdiction to decide the dispute. The High Court
Division also has the power under section 20 to decide the dispute as to the
jurisdiction of arbitration tribunal upon an application made by any of the parties to
the arbitration agreement. As provided under sub-section (4) the arbitration tribunal
shall be at liberty to continue the proceedings and make an award notwithstanding
such an application pending before the High Court Division.

2.8 Section 7 read with section 10 of the Arbitration Act 2001 puts a bar for
judicial authority to hear any legal proceedings commenced by any of the parties to
the arbitration agreement against the other party except in so far as provided under
this Act. Where legal proceedings are commenced at the instance of one party in
respect of the matter covered by the arbitration agreement, the other party before
filing written statement can apply to the court to make an arbitral reference to
arbitration tribunal to stay further proceedings of the suit unless the court finds that
the arbitration agreement void, inoperative or incapable of determination by
arbitration it shall refer the matter to arbitration and stay the legal proceedings.

2.9 Under Section 7A the court and the High Court Division have been
empowered to make interim orders in respect of interim custody, or sale or other
protective measures regarding the goods or property of the arbitration agreement,
pass interim injunction to restrain transfer of property or part thereof which may
create impediment in the way of enforcement of award and to appoint receiver.

SECTION 3 ARBITRAL AWARD

Appeal against or setting aside an award in Singapore

3.1 Appeals to a court against awards on the merits are permissible only in
arbitrations under the domestic Arbitration Act (Sect.49, Arbitration Act). No appeal is
permitted under the IAA. The right of appeal can be excluded by agreement
(Sect.49 (2) of the Arbitration Act).

3.2 Before granting leave to appeal, the court must be satisfied that:
(a) the determination of the question will substantially affect the rights of one or more
of the parties;

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(b) the question is one which the arbitral tribunal was asked to determine;
(c) on the basis of findings of fact in the award:
(i) the decision of the arbitral tribunal on the question is obviously wrong; or
(ii) the question is one of general public importance and the decision of the arbitral
tribunal is at least open to serious doubt; and
(d) despite the agreement of the parties to resolve the matter by arbitration, it is just
and proper in all the circumstances for the court to determine the question. (Sect.49,
Arbitration Act).

3.3 In addition, before an appeal can be made, the applicant must first exhaust all
available arbitral processes of appeal or review and any available recourse under
Sect. 43 Arbitration Act. Where the High Court has made a decision on the merits of
the appeal and refuses leave to appeal further to the Court of Appeal, the right of
further appeal terminates.

3.4 Arbitral awards made under the Arbitration Act may, apart from being set
aside on appeal, be also set aside if:
(a) the court is satisfied that:
(i) a party to the arbitration agreement was under some incapacity;
(ii) the arbitration agreement is not valid under the law to which the parties have
subjected it, or failing any indication thereon, under the laws of Singapore;
(iii) the party making the application was not given proper notice of the appointment
of an arbitrator or the arbitration proceedings or was otherwise unable to present his
case;
(iv) the award deals with a dispute not contemplated by or not falling within the terms
of the submission to arbitration, or contains decisions on matters beyond the scope
of the submission to arbitration, except that, if the decisions on matters submitted to
arbitration can be separated from those not so submitted, only that part of the award
which contains decisions on matters not submitted to arbitration may be set aside;
(v) the composition of the arbitral tribunal or the arbitral procedure is not in
accordance with the agreement of the parties, unless such agreement is contrary to
any provisions of this Act from which the parties cannot derogate, or, in the absence
of such agreement, is contrary to the provisions of this Act;
(vi) the making of the award was induced or affected by fraud or corruption;
(vii) a breach of the rules of natural justice occurred in connection with the making of
the award by which the rights of any party have been prejudiced; or
(b) if the court finds that—
(i) the subject matter of the dispute is not capable of settlement by arbitration under
this Act; or
(ii) the award is contrary to public policy.

An application for setting aside an award may not be made after the expiry of 3
months from the date on which the party making the application had received the
award, or if a request has been made under section 43, from the date on which that
request had been disposed of by the arbitral tribunal. Under Subsection (2) of
Sect.48, Arbitration Act, the Court may, where appropriate and so requested by a
party, suspend the proceedings for setting aside an award, for such period of time as
it may determine, to allow the arbitral tribunal to resume the arbitration proceedings
or take such other action as may eliminate the grounds for setting aside an award.
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3.5 Under the IAA, the only recourse against an award made is to set it aside and
the grounds to set aside are similar to the grounds to set aside an award under the
Arbitration Act. (Art.34, Model Law, IAA). Under the IAA, the High Court may, in
addition to the grounds enumerated in the Model Law, set aside an award if the
making of the award was induced or affected by fraud or corruption, or a breach of
the rules of natural justice occurred in connection with the making of the award by
which the rights of any party have been prejudiced. (Sect.24, IAA). A policy of
minimal curial intervention has consistently been adopted by the Singapore court
even with regard to domestic cases. The Court of Appeal has always taken a
generous approach and will not examine an award assiduously looking for blame or
fault in the arbitral process. (Soh Beng Tee & Co Pte Ltd v Fairmount Development
Pte Ltd [2007] SCCA 28).

Appeal against or setting aside an award in Hong Kong

3.6 Section 23 of the Arbitration Ordinance states:

(1) Without prejudice to the right of appeal conferred by subsection (2) the Court
shall not have jurisdiction to set aside or remit an award on an arbitration agreement
on the ground of errors of fact or law on the face of the award.
(2) Subject to subsection (3) an appeal shall lie to the Court on any question of law
arising out of an award made on an arbitration agreement; and on the determination
of such an appeal the Court may by order-
(a) confirm, vary or set aside the award; or
(b) remit the award to the reconsideration of the arbitrator or umpire together with the
Court's opinion on the question of law which was the subject of the appeal;
and where the award is remitted under paragraph (b) the arbitrator or umpire shall,
unless the order otherwise directs, make his award within 3 months after the date of
the order.
(3) An appeal under this section may be brought by any of the parties to the
reference-
(a) with the consent of all the other parties to the reference; or
(b) subject to section 23B, with the leave of the Court.
(4) The Court shall not grant leave under subsection (3)(b) unless it considers that,
having regard to all the circumstances, the determination of the question of law
concerned could substantially affect the rights of one or more of the parties to the
arbitration agreement; and the Court may make any leave which it gives conditional
upon the applicant complying with such conditions as it considers appropriate.
(5) Subject to subsection (6), if an award is made and, on an application made by
any of the parties to the reference-
(a) with the consent of all the other parties to the reference; or
(b) subject to section 23B, with the leave of the Court, it appears to the Court that the
award does not or does not sufficiently set out the reasons for the award, the Court
may order the arbitrator or umpire concerned to state the reasons for his award in
sufficient detail to enable the Court, should an appeal be brought under this section,
to consider any question of law arising out of the award.

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(6) In any case where an award is made without any reason being given, the Court
shall not make an order
under subsection (5) unless it is satisfied-
(a) that before the award was made one of the parties to the reference gave notice to
the arbitrator or umpire concerned that a reasoned award would be required; or
(b) that there is some special reason why such a notice was not given.
(7) No appeal shall lie to the Court of Appeal from a decision of the Court on an
appeal under this section unless the Court or the Court of Appeal gives leave.
(8) Where the award of an arbitrator or umpire is varied on appeal, the award as
varied shall have effect (except for the purposes of this section) as if it were the
award of the arbitrator or umpire.

3.7 Arbitral awards can be set aside under Art.34 of the Model Law in Schedule 5
of the Arbitration Ordinance 1963. The Grounds of setting aside is identical to the
grounds provided under the Singapore Act. There are no provision for opting out of
Appeal as in Singapore Act.

Appeal against or setting aside an award in Bangladesh

3.8 Arbitration Act, 2001 provides for appeal only to the High Court Division
against certain order passed by the court of District Judge. The orders against which
appeal lies to the High Court Division include an order made under sub-section (1) of
section 42 by the District Judge setting aside or refusing to set-aside an arbitral
award other than an international commercial award; refusing to enforce the arbitral
award under section 44; refusing to recognize or enforce any foreign arbitral award
under section 45.

3.9 There are no recognised conditions for allowing an appeal as in Section 49 of

the Singapore Arbitration Act.

3.10 The Court may set aside any arbitral award under this Act other than an
award made in an international commercial arbitration on the application of a party
within sixty days from the receipt of the award ( Sect. 42 (1) Arbitration Ac t’01). The
High Court has similar powers in relation to International Commercial Arbitration
(Sect.42(2) Arbitration Act’ 01).

3.11 Section 43 of the Arbitration Act 2001 states that:

(1) An arbitral award can be set aside if-

a) the party making the application furnishes proof that-

(i) a party to the arbitration agreement was under some incapacity;

(ii) the arbitration agreement is not valid under the law to which the parties have
subjected it;

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(iii) the party making the application was not given proper notice of the appointment
of an arbitrator or of the arbitral proceedings or was otherwise unable due to some
reasonable causes to present his case;

(iv) the arbitral award deals with a dispute not contemplated by or not falling within
the terms of the submission to arbitration or it contains decisions on matters beyond
the scope of the submission t o arbitration; Provided that, if the decisions on matter
submitted to arbitration can be separated from those not so submitted, only that part
of arbitral award which, contains decisions on matters not submitted to arbitration
may be set aside;

(v) The composition of the arbitral tribunal or the arbitral procedure was not in
accordance with the agreement of the parties, unless such agreement was in conflict
with the provisions of this Act or, in the absence of such agreement, was not in
accordance with the provisions of this Act.

(b) The court or the High Court Division, as the case may be, is satisfied that-

(i) the subject-matter of the dispute is not capable of settlement by arbitration under
the law for the time being in force in Bangladesh;

(ii) the arbitral award is prima facie opposed to the law for the time being in force in
Bangladesh

(iii)The arbitral award is in conflict with the public policy in Bangladesh; or

(iv) the arbitral award is induced or affected by fraud or corruption.

(2) Where an application is made to set aside an award, the court or the High Court
Division, as the case may be, may order that any money payable by the award shall
be deposited in the Court or the High Court Division, as the case may be, or
otherwise secured pending the determination of the application.

SECTION 4 ENFORCEMENT OF ARBITRAL AWARDS

Enforcement in Singapore

4.1 Awards, including interim awards, whether in a domestic (Sect. 46(1),

Arbitration Act) or international arbitration (Sect.19, IAA) are enforceable with leave
of the High Court in the same manner as orders or judgments of court (Sect.46,
Arbitration Act; Sect. 19 IAA). In case of urgency, ex-parte applications are
permissible on such terms as may be imposed by the court. (Order 69A, Rule 3(3),
Rules of Court (2006 Rev Ed.) An award once made (Sect. 19B (3) IAA and Sect.
44(3), Arbitration Act provide that the award is made when it is ‘signed and delivered’
in accordance with Art.31 Model Law and Sect.38 Arbitration Act respectively) is
valid and binding on the parties (Sect. 44(1), Arbitration Act; Sect 19B IAA) and
requires no further step of registration or fiat to give it effect. Further, if any party fails
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to voluntarily adhere to the terms of the award, the award may be enforced before
the courts of Singapore.

4.2 If leave to enforce an award is refused, an appeal may be made to the Court
of Appeal within one month from the date the order refusing leave is made (Order
57, Rule 4, Rules of Court). The application for leave to enforce the award must be
made within six years after the making of the award. (Sect.6, Limitation Act Cap.
163). Leave to enforce an award as a judgment or order of the court is often granted
ex parte and the order so obtained served on the debtor. Within fourteen days after
service of the order granting leave or such other period as the court granting leave
may stipulate, the debtor may apply to set aside the order.(Order 69A, Rule 6, Rules
of Court) The award shall not be enforced during that period or, if the debtor applies
to set aside the order, until after the application is finally disposed of.

4.3 A party who fails in its application to set aside the order granting leave to
enforce the award may appeal to the Court of Appeal within one month of the date of
the court’s decision (Order 57, Rule 15, Rules of Court). An appeal against the order
granting leave to enforce the award would not operate as a stay or suspension of
execution. (Order 57, Rule 15, Rules of Court) The Court of Appeal may, however,
order that execution be suspended upon security being furnished or make such
order as may be appropriate to prevent prejudice to any of the parties pending the
appeal(Sect.36(1), Supreme Court Judicature Act Cap.322). The Arbitration Act is
silent as to the grounds on which the court may refuse enforcement of the award.
However, to keep within the spirit of Section 47 of the Arbitration Act (which limits
challenges to awards to those set out within the Arbitration Act) the grounds for
refusal to enforce should be no wider than those that relate to the setting aside of the
award. ( Para.254 of Michael Hwang S.C. and Andrew Chan’s Singapore Chapter in
Michael Moser, gen. ed. Arbitration in Asia (Butterworths 2001)).

4.4 The procedure for the enforcement of foreign arbitral awards made in a New
York Convention country other than Singapore – Singapore having made the
reciprocity reservation set out in Art I(3) of the New York Convention – is set out in
Part III of the IAA. These awards may be enforced in Singapore either by action or in
the same manner as a judgment or order to the same effect, with the leave of the
High Court. If leave is granted, judgment will be entered in terms of the award
(Sec.19 read with Sect.29 of the IAA). Such awards are also recognized as binding
for all purposes upon the persons between whom they were made, and may
accordingly be relied upon by any of those parties by way of defence, set-off or
otherwise in any legal proceedings in Singapore (Sec. 29(2) of IAA).

4.5 Leave to enforce a foreign award as a judgment or order of the court is often
granted ex parte and the order so obtained served on the debtor. Within fourteen
days after service of the order granting leave or such other period as the court
granting leave may stipulate, the debtor may apply to set aside the order(Order 69A,
Rule 6 (4), Rules of Court). The award shall not be enforced during the pendency of
the application and until after it is finally disposed of. A court hearing the application
for enforcement of a foreign award cannot review the case on the merits. It may,
however, refuse to grant enforcement of the award in Singapore if the grounds set
out in Sect. 31(2) IAA are proven. These grounds are identical to those set out in Art.
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V of the New York Convention. However the Singapore courts have yet to refuse
enforcement of any Conventional award as of 30 April 2008.

Enforcement in Hong Kong

4.6 Section 2GG provides that (1) An award, order or direction made or given in
or in relation to arbitration proceedings by an arbitral tribunal is enforceable in the
same way as a judgment, order or direction of the Court that has the same effect, but
only with the leave of the Court or a judge of the Court. If that leave is given, the
Court or judge may enter judgment in terms of the award, order or direction.
(2) Notwithstanding anything in this Ordinance, this section applies to an award,
order and direction made or given whether in or outside Hong Kong.

Enforcement in Bangladesh

4.6 Under the Arbitration Act 2001 there is no requirement of filing the award in
the court for making the same rule of the court. When not challenged in the court for
setting aside the award on any grounds mentioned under section 43 or where the
challenge becomes unsuccessful, the award becomes enforceable straight way as
per provision of section 44 and in accordance with relevant provisions of Code of
Civil Procedure.

4.7 Sections 45, 46 and 47 of the Arbitration Act 2001 relate to the recognition
and enforcement of foreign arbitral award. Unless there is any ground enumerated
under section 46 for refusal, any foreign award shall be binding upon the parties and
may be relied upon by any of the parties in any legal proceedings in Bangladesh by
way of defence or set off. Foreign arbitral shall be executed in accordance with the
provision of Code of Civil Procedure 1908 as if it were a decree of the Court.

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Bibliography

International and Domestic Arbitration in Singapore , by Lawrence G Boo,Deputy

Chairman, Singapore International Arbitration Centre; Adjunct Associate Professor,
National University of Singapore, Faculty of Law (Singapore); Visiting Professor,
Wuhan University School of Law( China); Adjunct Professor, Bond University Faculty
of Law ( Australia).

The Law Reform Commission Of Hong Kong Report on Commercial Arbitration. 11

December 1981

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