An international Arbitral Tribunal has ruled that the Malaysia-Singapore joint venture firm, M+S, need not pay a development charge on three parcels of former railway land.
The decision involving former Malayan Railway land in Keppel, Kranji and Woodlands has brought closure to a dispute between the two countries over the tax.
The two countries announced the news in a joint statement by their foreign affairs ministries.
JOINT STATEMENT ON THE AWARD OF THE ARBITRAL TRIBUNAL CONSTITUTED UNDER THE AUSPICES OF THE PERMANENT COURT OF ARBITRATION ON THE ISSUE OF DEVELOPMENT CHARGES RELATING TO THE FORMER MALAYAN RAILWAY LAND UNDER THE POINTS OF AGREEMENT ON MALAYAN RAILWAY LAND IN SINGAPORE
In September 2010, the Prime Ministers of Singapore and Malaysia announced that both countries had different views relating to the development charges on the three parcels of Points of Agreement (POA) land in Tanjong Pagar, Kranji and Woodlands.
Both Leaders agreed to settle the issue amicably through arbitration and agreed to accept the arbitration award as final and binding.
In January 2012, Singapore and Malaysia entered into an agreement, submitting the issue to final and binding arbitration. The Permanent Court of Arbitration acted as Registry in this arbitration. The arbitration proceedings were conducted in accordance with the procedural rules agreed to by Malaysia and Singapore, and before a three person Arbitral Tribunal appointed by the countries.
The Arbitral Tribunal delivered its award on 30 October 2014. It decided that M+S Pte Ltd would not have been liable to pay development charges on the Keppel, Kranji and Woodlands parcels if the said parcels had been vested in M+S Pte Ltd and if M+S Pte Ltd had actually developed the lands in accordance with the proposed land uses set out in the Annexes to the POA.
Both Singapore and Malaysia are satisfied with the arbitral process and affirm that both countries were afforded the opportunity to fully present their case on the issue. Singapore and Malaysia have agreed to abide by and fully implement the decision of the Tribunal.
By resolving this matter through third party arbitration, both countries have demonstrated our common commitment to settling disputes in an amicable manner, in accordance with international law.
The full and successful implementation of the POA has paved the way for joint development projects and closer collaboration between Singapore and Malaysia. Both countries look forward to working closely together to further strengthen and broaden our bilateral cooperation.