It’s no secret that the economy is heavily impacted by the coronavirus outbreak.
For instance, restaurants expected as much as an 80% drop in revenue due to the coronavirus and had to seek help with rentals.
Now, there’ll be a new law to help companies and individuals who are struggling.
There’s Going to Be a New Law That’ll Let Companies & Individuals Pay Their Contractual Obligations Later
A new Bill which will be aimed at protecting individuals and companies who are not able to fulfil their contractual obligations due to the COVID-19 pandemic will be tabled in Parliament next week, according to the Ministry of Law (MinLaw).
The COVID-19 (Temporary Measures) Bill will help individuals and companies in various ways.
For example, it will help to prevent a hotel or catering company from forfeiting a deposit when a wedding or business function has been postponed due to the coronavirus.
The ministry announced that it has plans to expedite the process of passing the new Law through a Certificate of Urgency signed by the President.
This will enable all three readings of the Bill to be taken in one Parliament sitting.
Whole-Of-Government Effort & Was Put Together In A Couple Of Days
According to Minister for Home Affairs and Law K.Shanmugam, the Bill is a whole-of-government effort involving agencies like the Ministry of Finance and the Ministry of Trade and Industry.
In addition, committee members from the private sector such as law practice Drew & Napier, DBS and Capitaland were also involved.
“The Bill was put together very quickly, in a matter of days, as we saw the situation deteriorating,” he said.
The Bill will be passed as early as next week and will prevent landlords from terminating commercial leases due to non-payment of rent if it’s as a result of the coronavirus.
A good example is a restaurant that has received lesser customers following the coronavirus outbreak.
That being said, the rent will still stack up but it will only be due six months later.
Provides Temporary Cash-Flow Relief For Businesses & Individuals
The law will thus help businesses and individuals by providing temporary cash-flow relief for both businesses and individuals.
Without the law, they might’ve had to pay damages or risk having their deposits or assets forfeited for failure to meet contractual obligations.
This came after the public health measures that have been adopted by governments such as stricter border controls and safe distancing have caused “unprecedented and unforeseeable social and economic impact and led to supply chain disruptions and manpower shortages”.
“In many cases, this has undermined the ability of individuals and businesses to fulfil contractual obligations,” it said.
“It would be unfair to hold them strictly liable for their failure to do so.”
Covers Contracts Entered Into Or Renewed On Or Before 24 March
The proposed law will cover contractual obligations to be performed on or after 1 February this year, which the ministry said was the approximate date when the coronavirus began to impact Singapore greatly.
It will cover contracts entered into or renewed on or before 24 March.
24 March was the date that authorities announced stricter measures to prevent further spread of the coronavirus.
These measures included the closure of entertainment venues and deferment or cancellation of all events and mass gatherings.
Do note however that the proposed law will not absolve or remove parties’ contractual obligations. Instead, it suspends them for a prescribed period, which is six months from when it becomes law.
A Relief For Husband & Wives To Be
This will come as a relief to couples who may have had their deposit forfeited following the postponement of their wedding date due to the COVID-19.
For instance, it provides that a hotel cannot forfeit a deposit for a wedding reception if it is postponed to a later date, and must return the deposit if it was forfeited earlier.
Do note though that this protection does not apply if the wedding couple cancels the event or changes hotels.
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To ensure that the decision made is just, MinLaw said it will employ around 100 assessors to resolve disputes arising from the application of measures under the law.
