Business Laws Every Singapore Company Should Be Aware Of

All Singapore companies are obliged to protect the Personal Data (PD) of their clients, employees, or any other individuals’ data the company may process. The two basic regulations that affect Singapore business in this area are the Personal Data Protection Act (PDPA) and the General Data Protection Regulation (GDPR).

PDPA

PDPA is Singapore’s law governing the collection, use, and disclosure (collectively called “processing”) of personal data by organisations in Singapore. The main purpose of the act is to ensure that a) all personal data is processed in a manner that respects the privacy and ownership rights of individuals; and b) organisations use such data for legitimate business purposes only.

The PDPA protects personal data and defines it as any data — whether true or not — about an individual who can be identified from that data, or from that data and other information to which the organisation has or may have access.

The following PD types are covered:

• Full name;
• National Registration Identity Card (NRIC) number or Foreign Identification Number (FIN);
• Photographs or video images of an individual;
• Personal mobile telephone number;
• DNA profile;
• Passport number;
• Thumbprint;
• Iris image;
• Voice recording of an individual.

Note that business contact information such as name, business title, business telephone number, business address and email are not considered to be PD.

You should take the following steps in your company to comply with PDPA:

• Appoint a Data Protection Officer;
• Notify clients about the purposes of collecting PD and seek consent to process their PD;
• Respond when clients ask about their PD;
• Ensure accuracy and allow correction of clients’ PD;
• Secure the PD held by your organisation;
• Dispose of PD that is no longer needed;
• Ensure protection of personal data when transferring the data overseas;
• Closely manage service providers that handle PD;
• Check the Do Not Call Registry before using mobile numbers;
• Proactively communicate to clients and employees your data protection policies, practices and processes.

GDPR

GDPR is a European Union regulation on data protection and privacy. The document has extraterritorial implications, i.e. it also applies to companies that are not residents of any of the EU states. The GDPR applies to companies that are registered outside the EU but collect or process the PD of persons (residents) of the EU. So if your Singapore company collects and processes PD of clients, employees, or other persons who are residents of the EU, you must comply with the GDPR requirements.

The following personal data is protected by the GDPR:

• Basic identity information such as name, address and ID numbers;
• Web data such as location or movements, IP address, cookie data and RFID tags;
• Health and genetic data;
• Biometric data;
• Racial or ethnic data;
• Political opinions;
• Sexual orientation;
• Data on person’s performance at work;
• Economic information;
• Personal preferences and interests;
• Other personal metrics such as reliability, behaviour patterns, etc.

To become GDPR compliant your company should take the following steps:

• Implement your data protection policy;
• Implement security mechanisms;
• Protect PD when working with other companies;
• Document processing activities;
• Conduct data protection impact assessments;
• Report PD breaches;
• Appoint a Data Protection Officer;
• Ensure privacy rights;
• Have a legal justification for data processing.

For more details, see our PDPA and GDPR Guide.

There’s no single act governing all contractual relations in Singapore. The rules are largely based on the common law of contract in England. Much of the law of contract in Singapore remains in the form of precedents i.e. judge-made rules. However, some aspects of the contract law are affected by specific statutes. These include the Application of English Law Act, the Contracts (Rights of Third Parties) Act, Consumer Protection (Fair Trading) Act, etc. Below is a summary of some of the key principles of Singapore’s contract law.

Capacity to Enter Into Contracts

A contract is legally binding only if the parties entering into such an agreement have the capacity to do so. A contract entered into with a minor, a person of unsound mind or an inebriated person may not be an enforceable one. Those individuals are deemed not to have the capacity to undertake obligations if they did not understand what they were agreeing to.

A contract with a company is almost always enforceable, as legally companies are defined as “persons” with the legal capacity to enter into contracts.

Offer, Consideration, Acceptance

Singapore law, like systems in other common-law countries, provides that a contract is formed only if it includes these three elements:

1. Offer. One of the parties has made a promise to do or refrain from doing some specified action in the future. An offer can be withdrawn at any time before it is accepted by the other party.

2. Consideration. This means that something of value must be promised in exchange for the specified action or nonaction in the offer. This can take the form of a significant expenditure of money or effort, a promise to perform some service, an agreement not to do something, or reliance on the promise. Consideration is the value that induces the parties to enter into the contract. The existence of consideration distinguishes a contract from a gift. A gift is a voluntary and gratuitous transfer of property from one person to another, without something of value promised in return. Failure to follow through on a promise to make a gift is not enforceable as a breach of contract because there is no consideration for the promise.

3. Acceptance. The offer must be accepted unambiguously. Acceptance may be expressed through words, deeds or performance as called for in the contract. In recent years, electronic offers and acceptances between parties have also been considered legitimate. Generally, the acceptance must mirror the terms of the offer. If not, the acceptance is viewed as a rejection of the offer and a counteroffer.

Terms of the Contract

A contract must resemble the rights and obligations that each party has. Some of the essential and obligatory terms include: the price being paid for a good or service, the description of the good or service being sold or provided, and the details of parties in the contract. Only the written contract can be used in determining the terms of the agreement, not prior negotiations or other oral or written evidence.

For terms that were not explicitly stated in the contract, the court may imply a term where necessary for public policy reasons or because it is necessary to fulfill the intentions of the parties and to ensure that it does not contradict any express term in the existing contract.

If there is no written contract, the courts will look at the parties’ statements and actions to determine if there was an intention to be legally bound. To make that determination, the courts look at when the representation was made, the importance the party attached to it and the sophistication of the party.

For more details, see An Essential Guide to Singapore's Contract Law.

All Singapore companies in the course of their activity must follow market-based competition regulations. This branch of law promotes and seeks to maintain market competition by regulating anti-competitive conduct by any business. A competitive market results in open, dynamic markets, featuring increased productivity, innovation, and better value for consumers. Competition law is known also as “antitrust law” or "anti-monopoly law". The basic statute that regulates this field in Singapore is the Competition Act.

In order to achieve fair competition between market participants, the act prohibits companies from the following three basic activities:

1. Agreements that have as their object (or result) the prevention, restriction or distortion of competition in Singapore.

Companies’ agreements, decisions or concerted practices which involve the following are considered as having a detrimental effect on competition and are therefore deemed illegal:

• The fixing of purchase or selling prices or any other trading conditions;
• Limitation on or control of production, markets, technical development or investment;
• The sharing of markets or sources of supply; or
• Bid rigging or collusive tendering.

2. Conduct that amounts to the abuse of a dominant position in any market in the country.

Typical examples of conduct that may be considered an “abuse of a dominant position” are as follows:

• Predatory behavior toward competitors;
• Limiting production, markets or technical development to the prejudice of consumers;
• Applying dissimilar conditions to equivalent transactions with other trading parties, thereby placing them at a competitive disadvantage; or
• Making the other party conclude the contract with additional obligations having no connection with the subject of the contract.

3. Mergers or acquisitions that may result in a substantial lessening of competition within any market in Singapore for goods and services.

The law prohibits mergers or acquisitions that result in a substantial lessening of competition within any of the goods or services markets. However, certain mergers are excluded from these restrictions. These include transactions that are approved by regulatory authorities, are under the jurisdiction of any regulatory authority, belong to specified activities set out in the law (such as services of general economic interest which result in economic efficiencies that outweigh their adverse effects), etc.

The state body responsible for the administration of the Competition Act is the Competition Commission of Singapore (the Commission). The Commission has wide powers to conduct investigations if there are “reasonable grounds” for suspecting an infringement of competition rules. It may recommend block exemption orders by the Minister for Trade and Industry. Such exemption orders may be given in respect of a particular category of agreements that are likely to contribute to improving production or promoting technical or economic progress.