Institute to promote legal convergence in Asia to be set up

SINGAPORE – With the recently concluded Trans-Pacific Partnership and ASEAN Economic Community set to boost Asian trade and investments, a new business law institute will be launched in January to navigate judiciary issues concerning Asian commercial laws.

The Asian Business Law Institute (ABLI) will initiate, conduct and facilitate research and produce authoritative texts to guide the convergence of Asian commercial laws, announced the Singapore Academy of Law (SAL)yesterday.

By 2020, Asia is expected to account for 35 per cent of world trade.

Speaking at a media briefing yesterday, chairperson of the SAL’s steering committee on legal convergence, Lee Suet-Fern, said the institute’s work on law convergence will be “transformative” for the region.

“The exciting part in this century is how cross-border trade and cross-border investments are just continuing to grow and grow…

“For that to happen, it is really difficult if businesses are having to deal with completely different systems,” she said.

“It is simply much easier if the commercial (frameworks) converge — identical, of course, would be perfect.”

In April, Chief Justice Sundaresh Menon said the time had come to establish “common legal norms and practices that will overcome regional differences and pave the way for freer trade and commerce”, given considerable heterogeneity among Asian legal systems.

While there is sizeable interest in Asia from European and American companies, they face “huge investment challenges” operating in Asia, noted Rajah & Tann partner Paul Tan.

For instance, laws differ among Asian countries, and information on the laws of the emerging economies such as Laos, Vietnam and Cambodia are less accessible.

With trade barriers coming down, Mr Tan added that it is increasingly common for clients to face multi-jurisdictional disputes.

Some issues the ABLI could tackle include the enforcement of court judgments, data protection and insolvency regimes.

Its work could be similar to counterparts such as the non-governmental American Law Institute (ALI). The organisation helps with law convergence across 50 states in the United States.

More details on the ABLI’s board of governors, which is expected to include some 15 eminent representatives from the region, will be announced in January.

ABLI has its work cut out, as there are no precedent institutions in Asia but many areas to look into, said SAL’s senior director and chief legal counsel Sriram Chakravarthi.

The academy will also host an international conference on legal convergence in Asia on Jan 21 and 22. Speakers will include CJ Menon and representatives from India, China, Hong Kong and Australia.