A Covid-19 (Temporary Measures) Bill was passed by the Singapore government in Parliament on 7 April 2020 to better protect businesses and individuals hit by the coronavirus pandemic. The Bill will be valid for six months and Law Minister K Shanmugam will be given authority to extend it up to a year.
The key measures cover:
Temporary relief from the inability to perform contractual obligations
A tenant may seek relief for leases of non-residential properties if there is proof that there is inability to pay rent during the prescribed period to a 'material extent' caused by the 'Covid-19 event'. This prohibits landlords from terminating a lease and commencement of legal proceedings due to non-payment because of the Covid-19 outbreak.
Deposits for event and tourism-related contracts must not be forfeited and have to be restored if the activity is scheduled to be held on or after 1 February 2020 and did not proceed due to a Covid-19 event. No cancellation charges should be imposed.
Construction-related, hire-purchase agreements or conditional sales agreements, as well as loan facilities are also covered in the Bill. The party unable to comply with their obligations will be required to serve a notice for relief.
Temporary Amendments to Bankruptcy and Insolvency Laws
The monetary debt threshold for personal bankruptcy is raised from $15,000 to $60,000. The suitability of an individual for a debt repayment scheme and the avoidance of bankruptcy is lifted from $100,000 to $250,000.
The monetary debt threshold for corporate insolvency is raised to $100,000 from $10,000. The statutory period to respond to demands from creditors before a presumption of insolvency will arise is extended from 21 days to 6 months. Directors, partners and trustee-managers will also be temporarily relieved from their obligations to prevent their companies trading while insolvent if the debts are incurred in the company’s ordinary course of business and during the period that the Act is in effect.
Temporary Measures for Conduct of Meetings
The Bill introduces some flexibility to hold meetings in line with safe distancing measures. This allows for conduct of meetings where personal attendance is required, such as Annual General Meetings (AGMs), to continue using alternative arrangements. Options include meetings to be conducted electronically through video conferencing, electronic voting, compilation of questions and responses or for an appropriate period of notice to be provided for the meeting to be deferred.
All social gatherings of any size in both private and public spaces have been banned under the Bill.
The Bill also mandates property owners who have not passed on the full rental rebates to tenants to do so in a timely manner by making a cash payment to the tenant or reducing or offsetting future rental payments. Property owners are prohibited from imposing conditions when passing on rebates, and they are required to keep a proper record that they have passed on the rebate. Failure to comply will result in an offence and the property owner shall be liable on conviction to a fine not exceeding $5,000. An avenue of redress will be available to tenants and property owners should there be any disputes relating to the transfer of the property tax rebate and has to be brought up by 31 December 2021.