This decision is of great interest as it is relatively unusual for a court to grant an ex parte injunction in support of an arbitration, let alone a foreign seated arbitration. The Singapore International Commercial Court (“SICC”), in a pithy decision delivered ex tempore, summarised the requirements for a worldwide freezing order[1] in support of a foreign-seated arbitration and explained how the requirements were met in this case.
Brief Facts: Novo was claiming damages of US$830 million from KSP and its founder arising out of an acquisition of a drug from KSP. Novo claims that KBP knowingly failed to disclose material information relating to the efficacy of the drug, and compliance and quality issues. Novo intended to commence arbitration in New York at the International Chamber of Commerce (“ICC”) under ICC Rules against the defendants. In support of that arbitration, Novo applied to the SICC for a world-wide freezing order.[2]
The law: To obtain a world-wide freezing order the claimant needs to show the following:
- A good arguable case on the merits;
- There is a real risk that the defendants would dissipate its assets to frustrate the enforcement of any award[3];
- That it is not inappropriate for the order to be made by reason of the place of arbitration being outside Singapore[4];
- The matter was one of urgency[5];
- The arbitral tribunal has no power or is unable for the time being to act effectively[6].
The decision: The court was satisfied that the requirements were met:
- Good arguable case It was sufficient for a good arguable case of fraud under New York law, which governed the dispute, that KBP knowingly failed to disclose material information and that its founder arguably knew of and participated in the misrepresentations.
- Real risk of dissipation Novo produced evidence that KBP was transferring the proceeds of the acquisition without any commercial reason and in anticipation of Novo’s claim.
- Not inappropriate The defendants have significant assets in Singapore, and the granting of the injunction would not interfere with the management of the case by the arbitration tribunal nor supervision of the same by the New York courts.
- Urgency The risk of dissipation justified the urgency.
- Power/ Effectiveness of tribunal The tribunal had not been constituted so could not act. Under the ICC Emergency Arbitration Rules, the application could not be heard ex parte. In any event New York law does not permit world-wide freezing/ Mareva injunctions.
The court granted the injunction.
Conclusion
The judge described the inability of the arbitrator to hear the application under the ICC Rules as a “gap,” which is addressed by the power granted to the Singapore court under the International Arbitration Act.[7]
It is noteworthy that under the 2025 SIAC Rules[8], the President of the SIAC Court may determine, on application, that the Emergency Arbitrator may hear an application for a protective preliminary order without service of the same on the defendant.[9]
For further information contact:
S Suressh
Partner & Head, International Arbitration
Suressh@harryelias.com
+65 6361 9883
Janerni Mohan
Legal Associate
JanerniMohan@harryelias.com
+65 6361 9837
[1] Commonly also referred to as a Mareva injunction
[2] The application was made pursuant to s 12A(2) of the International Arbitration Act 1994 (“IAA”), read
with s 18I of the Supreme Court of Judicature Act 1969
[3] Bouvier v Accent Delight [2015] 5 SLR 558 at [36]
[4] Section 12A(3) International Arbitration Act
[5] Section 12A(4) International Arbitration Act
[6] Section 12A(6) International Arbitration Act
[7] [2025] SGHC(I) 3 at [9]
[8] Arbitration Rules of the Singapore International Arbitration Centre 7th Edition 1 January 2025
[9] See paragraphs 25 to 34 Schedule 1 SIAC Rules