Legal Ramifications of the COVID-19 (Temporary Measures) Act 2020


The government passed the COVID-19 (Temporary Measures) Act 2020 on 7 April 2020. Part 2 of the Act seeks to offer temporary relief to businesses and individuals who are unable to perform their contractual obligations because of COVID-19.

 

SGTech hosted a webinar with Mr Jonathan Kok, Partner at Withers KhattarWong LLP, to brief participants about Part 2 of the Act, including the relief measures and how companies can seek relief under the Act. Jonathan also serves as an Exco Member on SGTech’s Cloud & Data Chapter.
The Act covers relevant contractual obligations that are to be performed on or after 1 February 2020, and for contracts that were entered into or renewed before 25 March 2020.

 


(The Act covers contracts entered into or renewed before 25 Mar 2020, and obligations that are to be performed on or after 1 Feb 2020 by parties affected by COVID-19)

 

Actions Business Owners Can Take for Temporary Relief:

Business owners who need temporary relief from their contractual obligations can serve a Notification for Relief to the other Party on the contract within the prescribed period, stating the inability to perform the contract due to impact of COVID-19. The other Party would either accept the Notification or refer the matter to a 3rd-party Assessor for assistance.

 


(The Notification for Relief must state the reasons why the applicant is unable to perform their obligations due to COVID-19)

Once the Notification is accepted by the other Party or a 3rd-party Assessor, the other Party has to suspend enforcement of the contract, outlined by the following slide:

 


(The Notification for Relief must state the reasons why the applicant is unable to perform their obligations due to COVID-19)

Jonathan reminded the audience that the Act provides a suspension of the performance and enforcement of contractual obligations during the prescribed period. The obligations of the contract will resume after the prescribed period is over. He also encouraged companies that need to serve the Notification for Relief to seek legal advice and start the process as soon as they can.

For a detailed explanation on the Legal Ramifications of the COVID-19 (Temporary Measures) Act 2020, please view the webinar recording.

You may also download the presentation slides.

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Updates

The Minister for Law has since issued the COVID-19 (Temporary Measures) (Temporary Relief for Inability to Perform Contracts) Regulations
2020 ("the Regulations") on 20 April 2020. Please review the updates to the information that was shared during the webinar.

You may also wish to visit KhattarWong LLP's webpage for more information about the Singapore Covid-19 (Temporary Measures) Act .

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More to come

This webinar is a part of a series, "The Isolation Economy", through which SGTech shares useful information and resources with SMEs and startups. Please view the list of upcoming webinars




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Published Apr 2020