May 2, 2017

Litigation Partner Eugene Quah quoted in The Straits Times on how third-party collectors of donations should explicitly clarify they are not from the charity to avoid creating false impressions

RHTLaw Taylor Wessing Litigation Partner Eugene Quah was quoted in The Straits Times on how third-party collectors of donations should explicitly clarify they are not from the charity to avoid creating false impressions. The article was first published in The Sunday Times on 29 April 2017. Doubts over some donation drives Source: The Straits Times © Singapore Press Holdings Ltd. Date: 29 April 2017 Author: Priscilla Goy and Ng Jun Sen Some people here have grown wary of local appeals for donations of everyday items like newspapers, clothes and books to foreign charities. They have even gone online to share their experience of receiving fliers about such donation drives, hoping for clarification. Eunos Crescent resident Ethan Guo, who works in the charity sector and is in his 30s, alerted The Straits Times to one such flier he received two weeks ago. He was so sceptical, he made a police report. On April 20, he saw people collecting the donated items and said: "The people did not look like charity workers or wear anything to identify themselves as such at all." He may be right to doubt the credibility of some of them. For instance, a donation drive here on Oct 14 last year claimed to be by the Children's Heart Foundation, a charity in the United States, and featured the logo of the charity's Oregon chapter. But when ST contacted the charity's executive director, Mr William Foley, he said he did not know of anyone here donating to or raising funds for it. The charity was also not behind the fliers distributed here. Although a Singapore number was listed in the flier, nobody answered calls and there was no reply to text messages. Then there were fliers about two separate drives - Jan 30 last year and April 20 this year - to benefit the same charity called Child Africa, which helps poor children in East Africa. The first listed the collector's name "John" with a phone number. The other listed the collector's name "Dave", a different phone number and an e-mail address with a "hotmail.com" suffix. Educator Donna Kok, 43, saw the second flier and said: "The Hotmail address flagged to me that this may not be a legitimate donation drive." ST tried calling the Singapore numbers. "John" did not take the calls but "Dave" did, and agreed to meet yesterday. They both refer to Mr Dave Wong, 36, who used to work in a recycling company but has been unemployed for four months. His fliers have popped up in Eunos Crescent and Yishun but Mr Wong declined to say where else he had distributed the fliers. Speaking in Mandarin, he said his charity drive is for real and showed letters signed by the charity's managing director, Ms Julie Solberg. Child Africa, which has offices in Kenya, Uganda and Norway, replied to ST to say it is aware of donation drives here. Mr Wong, who said he was too busy giving out fliers and collecting items to reply to e-mails and calls, said he donates about 70 per cent of the proceeds from selling the items he collects to the charity, with the rest covering operating expenses. Under the House to House and Street Collections Act, a licence is required if a fund-raising appeal is made through "visits from house to house" - so what about these fliers? RHTLaw Taylor Wessing partner Eugene Quah said "visit" refers to "situations where there is face-to-face contact". But featuring the charities' logos in the fliers suggests the collectors represent the charities, he said. "If the (collectors) create a false impression through their fliers that they are from a particular charity, then they may be guilty of cheating under the Penal Code. They should state explicitly in the fliers that they are not from the charity but are merely assisting to collect donations for the charity." False Impression "If the (collectors) create a false impression through their fliers that they are from a particular charity, then they may be guilty of cheating under the Penal Code. They should state explicitly in the fliers that they are not from the charity but are merely assisting to collect donations for the charity." - RHTLaw Taylor Wessing Partner Eugene Quah
May 2, 2017

RHTLaw Taylor Wessing Deputy Head of Litigation & Dispute Resolution Nandakumar Renganathan interviewed by The Sunday Times on fraudulent investment schemes related to land-banking and gold buy-backs

RHTLaw Taylor Wessing Deputy Head of Litigation & Dispute Resolution Nandakumar Renganathan interviewed by The Sunday Times on fraudulent investment schemes related to land-banking and gold buy-backs The article was first published in The Sunday Times on 30 April 2017. Title: A legal expert's views on investments Source: The Sunday Times © Singapore Press Holdings Ltd Date: 30 April 2017 Here are some FAQs on fraudulent investment schemes posed by The Sunday Times to Mr Nandakumar Renganathan, deputy head of litigation and dispute resolution practice, RHTLaw Taylor Wessing. Q How can retail investors protect themselves when investing in gold and land-banking schemes? A The strongest power that investors have is in deciding whether to invest in a product. People generally associate investments in gold and property as safe investments and, no doubt, companies which sell dubious products take advantage of this. Often, investors are led to the investment by friends. They come into contact with agents of the company selling these products and are enticed to refer other friends to the investment through some benefits. Investors gain confidence when their friends say: "I have put money into this investment and it gives me a 20 per cent return." The focus must be on the investment product, not the anticipated return. In my experience, things just go awry when investors focus on the return rather than what they are investing in.   Q What should investors consider when assessing such investments? What are the typical red flags? A Investors should ask certain critical questions - what am I getting when I buy into this product? For example, if I am informed this is a property in Brazil, the questions to be asked before one invests are: •When was this company that sells this product incorporated? •Who owns this company? •Who are you entering into a contract with? Often, investors are misled into thinking they have invested with a Singapore company when, in actual fact, they have entered into a contract with a company overseas with the same name. •What am I getting for my investment? This is a critical question. If you are getting some share in a property, is that property going to be registered in your name? If it is merely that the company is collecting the money and the property is not vested in your name, you have a right only to receive payment from the company. There is no interest in the property. •Who owns the property? There have been occasions when companies that sell the products do not own the property. •How much debt does the company have? If you are investing into a company, you should know the risks associated with the business. •When you have a "guaranteed return", who is promising it? If the return is promised by the company, then the financial strength of the firm is critical. •Is the intermediary offering the investment product regulated in its home country by a competent regulator? If the investment product is regulated in Singapore, it would need a prospectus registered with the Monetary Authority of Singapore (MAS). If there is no prospectus and someone offers an investment product, that is a criminal offence in itself. •Is there a Singapore-based distributor of the investment product, and is the distributor regulated by the MAS? •Look out for the MAS Investor Alert List for instances of offers of investment products that are unlicensed. After investors have made their inquiries, they should have an idea of risks involved in making the investment.   Q What is the impact of the new regulation on firms offering land-banking schemes? A The MAS has closed a gap in the law by introducing new regulations relating to land-banking here. These products will be dealt with as collective investment schemes. This means that the managers of such schemes will need to be licensed by the MAS. These products need to be accompanied by prospectuses approved by the MAS. These measures seek to ensure that there is robust regulatory oversight on the managers (who have to be fit and proper persons). They also ensure that investors have access to all material facts to help them make informed decisions. In short, these ensure transparency and accountability in relation to the products being offered, as well as on the intermediaries offering the products.   Q Will aggrieved investors have any recourse against the company? A Investors can claim against the company and its officers if there has been fraud involved. They should approach their legal advisers and the authorities as soon as possible. If the investors are quick enough, they may even be able to secure an injunction from the court to freeze the assets of the company. If the company has the money with it, chances of recovery are better. One reality that investors should be aware of is that people who set up companies with a fraudulent purpose in mind plan ahead to move the money out as soon as they receive them. It becomes challenging to trace the money much later.   Q Any other tips? A The final question to be asked is "Is this too good to be true?" Investors should be wary of anyone saying you can double your money in three to four years. If they feel it is too good to be true, they should decline to invest.
April 28, 2017

RHTLaw Taylor Wessing Managing Partner Tan Chong Huat and General Counsel Alvin Chen shared with The Straits Times how airlines should be obligated to inform passengers of their rights if a flight is overbooked

RHTLaw Taylor Wessing Managing Partner Tan Chong Huat and General Counsel Alvin Chen shared with The Straits Times how airlines should be obligated to inform passengers of their rights if a flight is overbooked The article was first published in The Straits Times on 28 April 2017.   Regulate airlines' discretion in bumping passengers off overbooked flights Source: Straits Times © Singapore Press Holdings Ltd. Date: 28 Apr 2017 Author: Tan Chong Huat and Alvin Chen The recent dramatic eviction of a passenger from a United Airlines flight in the United States has prompted debate in Singapore on the common industry practice of overbooking, and raised concerns whether consumer rights are adequately protected. While the economic benefits of flight overbooking to airlines are obvious - to ensure that the number of vacant seats is kept to a minimum and, thereby, maximise the revenue for each flight - the heart of the matter is how airlines exercise their discretion to "bump off" passengers. Currently, there is no legislative framework in Singapore which governs the exercise of such discretion. In contrast, European Union Regulation 261/2004, enacted in 2004 to protect passenger rights, requires airlines "to reduce the number of passengers denied boarding against their will" by calling for volunteers to surrender their reservations, in exchange for compensation that is prescribed in these regulations. If there are insufficient volunteers, the airline may then proceed to deny boarding to passengers against their will. A similar regime is found in the US Code of Federal Regulations, which requires an airline to request volunteers before denying boarding. A volunteer is defined as someone who "willingly accepts the carrier's offer of compensation, in any amount", in exchange for giving up the seat. If there are insufficient volunteers, the airline can deny boarding to other passengers "in accordance with its particular boarding priority", subject to compensation. An airline's boarding priority rules are, however, no guarantee that a bumped-off passenger has been treated fairly. For example, in a lawsuit brought by the well-known American consumer advocate Ralph Nader against Allegheny Airlines in the early 1970s, the defendant airline had bumped off Mr Nader, who was due to give a speech to a public advocacy group, from one of its flights which had been overbooked. Mr Nader alleged that the defendant had contravened a provision in the US Federal Aviation Act, which prohibited an air carrier from subjecting passengers to unjust discrimination, or undue or unreasonable prejudice or disadvantage. Under the defendant's boarding priority rules, passengers with an "OK" marking on their tickets, or whose names were on a computerised list, had confirmed reservations and were to be boarded. After the flight had been boarded to capacity, Mr Nader, who had a confirmed reservation, arrived late at the boarding gate. He was not permitted to board as he was considered an "oversold" passenger under the boarding priority rules. The US court, however, found that the defendant had failed to comply with its own boarding priority rules, as it had denied Mr Nader's boarding priority by allowing at least one other oversold but lower-priority passenger, to board the flight. Admittedly, notwithstanding the absence of a legislative framework in Singapore, it may well be industry practice for air carriers departing from Singapore to adopt the approach in Europe and the US - ask for volunteers first, then deny boarding. However, such a practice is likely to result in inefficient negotiations, as the passenger cannot be certain about the amount of compensation the airline is willing to offer in exchange for denial of boarding, which would not be the case if clear compensation laws were in place, as in Europe and the US. Moreover, if this practice is applied inconsistently, both the airline and the passenger would be effectively negotiating in the dark about each other's positions. Coupled with the relatively tight timeframe that such negotiations must be completed before take-off and the potential permutations of each airline's boarding priority rules, one would expect that complaints against overbooking would be regularly lodged with the Consumers Association of Singapore (Case). However, following the United Airlines debacle, Case was cited in a media report as stating that no complaints against overbooking had been lodged since January last year. One plausible reason that may explain the apparent gap between theory and reality in Singapore is that because overbooking is a long-established practice, airlines have become adept at resolving the impasse if no volunteers step forward initially. As mentioned in The Sunday Times report on April 16 (No Room On The Plane), airlines may simply increase the incentives for denial of boarding. Also, given the large pool of potential "volunteers" available, it should not be too difficult to find a few passengers who are willing to be bumped off in exchange for adequate compensation. Compensated passengers are unlikely to be motivated to make a complaint to Case even though their negotiations with the airline may have taken more time and effort than necessary. Unless one is forced off the plane involuntarily, as in the United Airlines incident, there would not be clear cause for complaint. Nevertheless, the absence of consumer complaints may not be conclusive evidence that the market is working efficiently and no legislative intervention is required. Where there is poor management of oversold seats, the authorities must step in to achieve a better balance between the interests of passengers and those of airlines, and promote better customer-handling procedures. One area of concern is whether airlines should be permitted to deny boarding to vulnerable passengers, such as the elderly or the illiterate, on the basis that they had agreed to compensation. Such consumers may, however, not have understood the full ramifications of being denied boarding or appreciated the adequacy of the compensation offered. Under the US Code of Federal Regulations, it may be arguable whether they would be considered volunteers if their "willingness" to accept compensation was procured by improper influence. The lack of statutory guidance in Singapore on how airlines should exercise their discretion to bump off passengers may result in arbitrary or, worse, unlawful decisions, which should not be shielded by the "defence" of industry practice. In the interest of consumer protection in Singapore, clear provisions on the procedure for denying boarding and compensation amounts should be set out in statute, so as to address the information gap faced by passengers. Airlines should also be obligated to inform passengers of their rights to compensation and assistance, similar to those set out in Article 14 of EU Regulation 261/2004. Treating passengers fairly would not only be consistent with the position in Europe and the US, but would also reinforce Singapore's reputation as one of the world's top air hubs. Mr Tan Chong Huat is managing partner and Mr Alvin Chen is general counsel, legal and compliance, at RHTLaw Taylor Wessing.
April 27, 2017

Head of Intellectual Property & Technology Practice Jonathan Kok quoted in The Straits Times on the potential legal liabilities application companies could face

RHTLaw Taylor Wessing Head of Intellectual Property & Technology Practice Jonathan Kok was quoted in The Straits Times on the topic of measures to keep live streaming applications’ content in check. The article was first published in The Sunday Times on 26 April 2017. Measures in place to keep content in check Source: Straits Times © Singapore Press Holdings Ltd. Date: 27 Apr 2017 Author: Lester Hio When Bigo Live launched last year, the app quickly gained notoriety from streamers dressing provocatively and toeing the fine line between performing and explicit content. Now, both Bigo Live and BeLive, aware that people will abuse the adage that sex sells for the prospect of easy money by strutting their stuff in front of a camera, have measures in place to keep content clean. Both apps have age restrictions in place. Streamers who show explicit content are banned, as are users who use profanity or make abusive and derogatory remarks. "Censorship moderators and artificial-intelligence censors are available 24/7 to monitor content, and live streamers who fail to abide by the rules risk a permanent ban," said a Bigo Live spokesman. BeLive takes it one step further by banning the mobile phones of repeat offenders, using the phone's Unique Device Identifier so that banned users can't access the app. BeLive moderators are also alerted each time a new stream is started, and will monitor it for unsavoury content. "It can be quite obvious from the first five minutes of the streamer's opening act what he or she is up to," said BeLive co-founder Lim Kim Hui. Such concerns are potential legal pitfalls that both companies want to avoid in order to sustain the business. "If an app company comes to know about an obscene video but does nothing about it, then the app company could be liable," said lawyer Jonathan Kok, head of intellectual property and technology at RHTLaw Taylor Wessing. "An app company that wants to be a credible social media site would impose rules and regulations to ensure that the user-generated content is kept clean."