The Private Competition Enforcement Review: Singapore
Overview of recent private antitrust litigation activity
In 2010, the then assistant chief executive of the Competition Commission of Singapore (now renamed the Competition and Consumer Commission of Singapore (CCCS)), Mr Toh Han Li, stated that he expected private antitrust actions to be a trend to watch. However, to date there have been no private actions in Singapore for antitrust infringements. The only matter attempting to bring a private action was in 2010, in which a breach of Section 342 of the Singapore Competition Act (the Act) was unsuccessfully raised to support a fair dealing argument, in a defence and counterclaim against copyright infringement proceedings – Global Yellow Pages Ltd v. Promedia Directories Pte Ltd.3
Under Singapore law, Section 86(2)(a) of the Act provides that the right to private action to claim for damages is contingent on a prior final determination of an infringement. Accordingly, to bring about private actions through follow-on litigation, the final determination of an infringement decision issued by the CCCS4 is a prerequisite. In recent times, the CCCS has engaged in increasingly rigorous enforcement actions, which suggests that private enforcement activity through follow-on actions may reasonably be expected to increase in the future.
The CCCS's recent enforcement activity has been wide ranging and has included:
- an infringement decision against two ride-hailing firms, Grab and Uber, in relation to a proposed merger;
- prosecuting cartel conduct for seven years by 13 fresh chicken distributors. The conduct included coordinating the amount and timing of price increases, and agreeing not to compete for each other's customers in the market for the supply of fresh chicken products in Singapore;
- an action against four hotel operators for exchanging commercially sensitive information in relation to hotel room accommodation in Singapore supplied to corporate customers; and
- accepting voluntary commitments from a number of lift companies for refusal to supply spare lift parts for maintenance in public housing estates, which were alleged to be in breach of the prohibition against abuse of a dominant position.
General introduction to the legislative framework for private antitrust enforcement
Competition law in Singapore is governed by the Act, and is enforced by the CCCS. The CCCS states that its mission is 'making markets work well to create opportunities and choices for businesses and consumers in Singapore' and its vision is 'a vibrant economy with well-functioning and innovative markets' to underscore that its work benefits both businesses and consumers alike.
Section 86 creates the statutory follow-on action as a right of private action in Singapore.5 It appears that stand-alone actions are precluded by the Act, although there has never been any formal pronouncement of that position.6 Pursuant to the Act, the express statutory right to private action arises in limited circumstances and requires three elements. Those elements are:
- a final determination;
- that an entity has infringed Section 34, 47 or 54 of the Act; and
- that the victims have suffered loss directly.
A final determination is an infringement decision of the court that is not subject to any further right of appeal. A determination may be made by the CCCS but is subject to the entity's rights of appeal. A decision of the CCCS may be appealed to the Competition Appeal Board (CAB), which in turn is appealable to the High Court of Singapore, and from there to the Court of Appeal, within prescribed time limits.7
Additionally, the right to private action only arises when a final determination is issued stating that an operative provision of the Act has been infringed, including:
- Section 34, agreements that have as their intended objective, or result in, the prevention, restriction or distortion of competition within Singapore;
- Section 47, abusing a dominant position in a market in Singapore; and
- Section 54, where a merger with another entity results or is expected to result in the substantial lessening of competition in a market in Singapore.8
Finally, Section 86 of the Act provides for private actions offering remedies for victims of anticompetitive conduct for loss and damage suffered directly. As the Act explicitly refers to loss or damage suffered 'directly as a result of an infringement', it is unlikely that indirect purchasers will have standing to bring a claim. Therefore, by way of example, where there is conduct with an anticompetitive effect, such as a price increase that is passed along the supply chain, subsequent purchasers, including end-consumers, are unlikely to be afforded any recourse as their loss is not direct and therefore does not meet the requirement of the Act.
Timing of private action
Due to the requirement of a final determination, third parties have to wait until an entity exhausts all its rights of appeal before they are permitted to pursue a private action. A private claim for damages arising from an infringement of the Act must be brought within two years of either the time that the infringement decision is made or of the determination of any such appeal, whichever is later.9
Of course, the application of this rule is straightforward where there is only one addressee to an infringement decision. However, increasingly, and particularly in the case of cartels or anticompetitive contract cases, involving more than one entity or party may bring complications. A difficulty is likely to arise where one party appeals the infringement decision but a private applicant seeks to pursue a claim against a defendant who does not appeal. By operation of Section 86 of the Act, a private action is prohibited in the period when a right of appeal remains. It would therefore appear that an appeal by any of the parties who are subject to an infringement decision triggers the temporal restriction on commencing a private action.
The Act explicitly extends the prohibition on anticompetitive conduct beyond Singapore. The CCCS has exercised this extraterritorial jurisdiction over a number of foreign-registered companies.
For a private action to be pursued against foreign-registered companies, an applicant requires the leave of court to effect service of process out of Singapore. As an initial matter, pursuant to the Supreme Court of Judicature Act 1999 and the Subordinate Courts Act 1999, there must be a legal connection between a case or the defendant and Singapore. In its application for leave, the applicant must satisfy the court that the Singapore court is the most appropriate forum to hear the dispute. This may pose difficulties with increasingly globalised commerce and increasingly cross-border competition law breaches such as in the case of an international cartel.
Sections 33 and 34 of the Act provide jurisdiction to regulate anticompetitive behaviour with effects or consequences in Singapore. Accordingly, a claimant who has suffered loss in Singapore as a result of an infringement established by the CCCS is likely to establish that a Singaporean court is the appropriate forum for the application. One final matter is that Section 86(7) provides that a final determination of an infringement decision is binding on the Singapore court, reducing some burden on an applicant in establishing the competition law breach.
Singapore's private action regime means that the prerequisite CCCS action will be critical to whether a victim of anticompetitive harm can bring a private action. Assuming a final determination, only a person who suffers loss or damage directly as a result of anticompetitive conduct prohibited by the Act can bring an action. In this way, the victim is within the class of persons intended to be protected by the Act, and the damage falls within the scope of the protection of the Act.
As there have yet to be any private actions brought in Singapore for breaches of the Act, it is yet to be determined whether umbrella damages are also a basis for standing for private claimants against an entity in Singapore. Umbrella damages are mainly experienced in relation to a price-fixing cartel, where a loss is experienced by persons dealing with a non-conspiring industry participant who sets its price just under the umbrella of the cartel. The customer of the non-conspiring firm suffers the overcharging in a similar fashion to the customers of the cartel members. Clearly the question for such an applicant will be establishing the 'direct loss', given that such loss arguably only shares an indirect causal relationship with the infringement.
The process of discovery
Order 24 of the Rules of Court provides the procedures for discovery in civil proceedings in Singapore. The rule provides that parties to the proceedings will be required to provide discovery of documents in their possession, custody or power, that are relevant to and necessary for the fair disposal of the proceedings and the saving of costs, unless the documents are privileged.
Relevant documents include any that:
- the disclosing party relies or intends to rely on;
- could adversely affect its own or another party's case; and
- could support another party's case.
There is also limited scope for pre-action and third-party discovery in appropriate circumstances. A party can also apply to the court for specific discovery if it has reason to believe that an incomplete list of documents has been furnished.
Applications for discovery can also be made against non-parties such as the CCCS after the commencement of an action. However, the ability of private applicants to apply for discovery against companies or the CCCS to obtain documents – such as confidential versions of decisions, proffers and leniency materials – is unprecedented and is likely to be met with some resistance, possibly requiring special disclosure regimes including strict confidentiality. An exception to this would be where the proffers are cited in the CCCS's determination.
The process of discovery by private parties is a recognised threat to the global practice of regulators to offer leniency or immunity regimes to parties engaging in anticompetitive conduct to come forward in exchange for immunity, including from third-party actions. Equally, the need for the private applicant to obtain necessary evidence to advance its claim is recognised by courts and is a basis for discovery processes. Balancing these tensions is a significant matter of public policy. In recognition of this, the CCCS has provided that access to a leniency corporate statement is only granted to addressees of a provisional infringement decision, provided that the addressee undertakes not to make any copy by mechanical or electronic means.10 While yet to be tested, it appears that the effect of this guideline is to quarantine leniency documents from claimants in private actions.
Use of experts
Expert evidence is common in proceedings in Singapore and evidence law in Singapore admits the opinion of an expert witness to assist the court in reaching a proper conclusion on a matter that requires the application of special skill or knowledge. Parties will often seek to appoint their own expert rather than rely on a single joint expert. Expect evidence must be given in a written report signed by the expert and exhibited in a sworn or affirmed affidavit, unless otherwise directed by the court. The court11 can limit the number of expert witnesses who can be called at trial. These expert reports are also required to contain a statement that the expert understands that in making a report, their paramount duty is to assist the court on matters relevant to their expertise and they certify that they have complied with that requirement.
Additionally, Singapore's civil procedure rules12 provide for a concurrent expert evidence procedure, which allows for expert witnesses to question each other, answer questions from the judge and be cross-examined together.
Singapore does not have a class action regime. However, Order 15, Rule 12 of the Rules of Court provides for representative actions. Under this regime, claimants who wish to pursue a claim as a representative action must agree to do so; that is, opt in.
There is no formal requirement to certify a class in a representative action under the rules.13 However, the Singapore Court of Appeal14 has held that for a representative action to be brought, the class of represented persons must be capable of clear definition and identification. Additionally, the represented claimants must have the 'same interest' in the proceedings, and even where this requirement is satisfied, the court has the discretion to refuse to permit proceedings to continue as a representative action if it finds that they are not suitable.
As a representative action for a breach of the Act has yet to proceed, it remains to be seen whether a representative action will provide a satisfactory route for group litigation of infringements of competition law in Singapore, especially since each claimant must still individually establish that it has suffered the loss directly as a result of the infringement as required by the Act.
It is unlikely that the Singapore courts will award exemplary or punitive damages in relation to a private action for a competition law contravention. This is because the result might be that the offender is punished twice, owing to the earlier finding of the CCCS. Additionally, it is arguable that the Parliament did not intend Section 86 to include exemplary damages as they had been removed during the bill drafting process. Additionally, as there have not yet been any private actions in Singapore, it is as yet unclear whether a court would award restitutionary damages or an account of profits. Section 86(1) of the Act empowers the court to grant 'such other relief as the court thinks fit'; however, in Singapore, damages are assessed on compensatory principles to cure the harm or loss directly suffered.
In a private action, it is fundamental that the party claiming damages must prove the actual damages suffered from the contravention of the Act. This is consistent with the general approach that damages are intended to compensate the party for its losses, which include:
- lost profits on actual and potential sales;
- lost sales (due to consumers turning to available substitute goods);
- lost market share;
- interest;15 and
- to restore a litigant to the position they would have enjoyed had the contravening conduct or breach not occurred. The level of compensatory damage would depend on the remoteness of the loss of the applicant to the infringement.
In this respect, the assessment of the counterfactual, or the application of the 'but for' test, will be relevant. The counterfactual will identify the difference between the counterfactual scenario where the infringing activity did not occur and the actual scenario created by the anticompetitive behaviour, and thereby provides the measurement of damages. Identification of the most appropriate counterfactual can on occasions be tricky and the CAB has accepted that a counterfactual is not a legal requirement in assessing an abuse of dominance.16
As the right to private action arises only as a follow-on action, it is unlikely that there will be a substantial challenge to the conduct in question. Accordingly, proof of the damage is likely to be a substantial area of focus of the applicant and of the defence. However, in Robertson Quay, the court held that '[t]he law . . . does not demand that the plaintiff prove with complete certainty the exact amount of damage that he has suffered'.17
The court noted that in relation to proof of damages 'a plaintiff cannot simply make a claim for damages without placing before the court sufficient evidence of the loss it has suffered even if it is otherwise entitled in principle to recover damages. On the other hand, where the plaintiff has attempted its level best to prove its loss and the evidence is cogent, the court should allow it to recover the damages claimed.' As in other jurisdictions, when seeking to prove loss from a competition law violation, complex economic evidence will likely form a substantial component of the applicant's evidence and may, in the end, be an exercise in estimation as opposed to establishing the precise quantum.
There is no established pass-on defence in Singapore. The defence has clear application in jurisdictions where compensation is a primary purpose. As victims who suffer indirect loss are not eligible for compensation in Singapore, the court may need to consider the competing considerations of over-compensating the claimant and under-penalising the infringing party.
The court is also likely to need to consider the question of mitigation of losses. When awarding damages, the court may also have to take into account effects that result from the conduct of the claimant. In particular, that the claimant ought to have taken reasonable steps to prevent or reduce the loss arising from the wrong that the defendant committed.
Follow-on litigation is permitted under the Act but only after the CCCS has found a party to be in breach of Singapore's competition laws and after the expiry of any applicable appeal period, can third parties bring such an action. This approach is likely in recognition of the fact that a generalist court is not always the best qualified to undertake determinations of alleged contraventions of competition law that often involve very technical analysis. Additionally, as noted above, Section 86 of the Act specifically states that the right to private action is only available to 'any person who suffers loss or damages directly as a result of any infringement'.
A class action regime similar to those commonly known in other jurisdictions such as the United States does not exist in Singapore and the only process available for collective redress is through a representative action under Order 15, Rule 12 of the Rules of Court. It is a specific requirement that persons who wish to pursue a claim as a representative action must agree to do so or opt-in. These claimants are required by the rules to have the same interest in the action but the court has a discretion to decline proceedings being conducted as a representative action.
Singapore recognises the concept of legal professional privilege with two limbs, legal advice privilege and litigation privilege. Documents that are protected by legal professional privilege are exempt from disclosure requirements and will not be required to be produced to another party through compulsory court process.18
Singapore law recognises legal advice privilege. Under legal advice privilege, communications for the purposes of obtaining legal advice are protected from disclosure. The main sources of Singapore law for legal advice privilege are several provisions in the Evidence Act. Legal advice privilege applies to correspondence between the party and its solicitor and extends to communications with in-house counsel.19
Litigation privilege is intended to maintain the confidentiality required by parties to prepare their case and strategy in litigation. The main source of Singapore law for litigation privilege is common law and has been explicitly recognised in past Singapore Supreme Court cases.
In respect of private civil claims, an offer to settle can be made (and accepted) at any time before the court finalises the matter.20 There is no requirement for leave of the court to be obtained before accepting an offer to settle. Where an offer is accepted, the court can incorporate any of its terms into a judgment.21
An offer to settle is not filed with the court, and no statement of the fact that such an offer has been made will be contained in any court document. Where an offer to settle is not accepted, no communication in respect of the offer can be made to the court until all questions of liability and the relief have been determined.22
A party may apply to the court for an order referring all or part of the proceedings to mediation or arbitration and to have the court proceedings stayed. If the court orders that the parties proceed to arbitration, then either party may apply to the court to have an arbitrator appointed and make orders about how the arbitration is to be conducted, including how the arbitrator's fees will be paid and when the arbitration must be completed. If the arbitration is successful, the parties may apply to the court to make an order in terms of the award set out by the arbitrator. Of course, as there have yet to be any private actions for breaches of competition law, it is an unresolved question whether arbitration would be popular for private competition law litigation in Singapore.
Indemnification and contribution
A private litigant can bring a claim for a breach of the Act against any person named in the CCCS's determination and that caused his or her loss or damage.
Future developments and outlook
As the right to private action is contingent on a prior infringement decision of the CCCS, the likelihood of such a claim arising is inevitably linked to the number and frequency of infringement decisions issued by the CCCS. Increasing activity is also dependent on the awareness of third parties of their right to private action, and the degree to which the conditions for bringing a civil claim for private damages are attractive to a plaintiff.
The CCCS takes the view that cartels are one of the most harmful forms of anticompetitive conduct, and that cartels will remain a high enforcement priority. Accordingly, the most likely avenue for private actions is actions arising out of cartel conduct.
Cartel-related determinations by the CCCS during 2020 involved:
- bid-rigging activities by construction contractors in response to requests for quotations by Wildlife Reserves Singapore;23 and
- bid-rigging conduct relating to tenders called for the provision of maintenance services for swimming pools, spas, fountains and other water features. Affected developments included condominiums and hotels in Singapore.24
It will be interesting to see whether victims of either of these two cartels bring private actions for the damages suffered.
1 Prudence J Smith, Matthew J Skinner and Sushma Jobanputra are partners, and Mitchell J O'Connell is an associate, at Jones Day.
2 Section 34 prohibits agreements or concerted practices that have, as their object or effect, the prevention, restriction or distortion of competition within Singapore.
3  SGHC 97.
4 The CCCS was renamed on 1 April 2018 when it took on an additional function of administering the Consumer Protection (Fair Trading) Act. It was previously known as the Competition Commission of Singapore.
5 Cavinder Bull and Lim Chong Ki, Competition Law and Policy in Singapore (Singapore: Academy Publishing, 2nd Edition, 2009), p. 274.
7 Singapore Competition Act (the Act), Section 86(2) and (3); CCCS Guidelines on Enforcement of Competition Cases 2016, Paragraph 5.2.
8 Act, Section 86(1); CCCS Guidelines on Enforcement of Competition Cases 2016, Paragraph 5.1.
9 Act, Section 86(6); CCCS Guidelines on Enforcement of Competition Cases 2016, Paragraph 5.3.
10 CCCS Guidelines on Lenient Treatment for Undertakings Coming Forward with Information on Cartel Activity 2016, Paragraph 9.2.
11 Order 40A Rule 1, Rules of Court.
12 Order 40A Rule 6, Rules of Court.
13 Order 15 Rule 12, Rules of Court.
14 Koh Chong Chiah and others v. Treasure Resort Pte Ltd  4 SLR 1204 at Paragraph 78.
15 Section 12, Civil Law Act.
16 In the matter of: Notice of Infringement Decision issued by the Competition Commission of Singapore, Abuse of a Dominant Position by SISTIC.com Pte Ltd, Case No. CCS 600/008/07, 4 June 2010 at .
17 Robertson Quay Investment Pte Ltd v. Steen Consultants Pte Ltd and another  SGCA 8.
18 Sections 128 and 131, Evidence Act, Chapter 97.
19 Section 131, read with Section 128A, Evidence Act.
20 Order 22A, Rule 6(3), Rules of Court.
22 Order 22A, Rule 5, Rules of Court.