Singapore ruling raises questions over recovery of debts in the city-state owed to foreign casinos: law firm

Foreign casino operators extending credit to customers with assets in Singapore may need to reassess the risks of recovering such debts in the city-state, following a recent High Court ruling, suggests an analysis by Singapore law firm Rajah & Tann. It said the decision, in a case involving Venetian Macau Ltd – the entity holding the gaming concession of Macau casino operator Sands China Ltd – versus businesswoman Hu Yangning, represented a “turning point” in Singapore law regarding enforcement of foreign judgements relating to gambling debts. Under the ruling, foreign casino operators cannot rely on Singapore’s statutory registration process to recover gambling debts via the country’s courts, even where the operator has already obtained a valid judgement elsewhere, said the legal analysis. Venetian Macau Ltd had obtained a Hong Kong judgement against Ms Hu for HKD19.35 million (US$2.5 million), before seeking to register it in Singapore. As previously reported by GGRAsia, Singapore High Court judge Philip Jeyaretnam set aside registration of the Hong Kong judgement, finding that enforcement would run contrary to Singapore public policy concerning gambling debts. “The practical effect is clear: Singapore’s courts will not serve as debt collectors for foreign casinos, regardless of whether a valid foreign judgement has been obtained,” wrote lawyers Lau Kok Keng, Yong Yi Xiang, and Claire Mak. “Foreign operators extending credit to patrons with assets in Singapore must now factor this enforcement barrier into their credit and risk assessments,” they added. Unresolved issues The lawyers nonetheless identified several unresolved questions. One factor concerns whether a distinction should be made between debts arising from regulated casino gambling and those linked to unregulated gambling. The High Court found that Singapore’s acceptance of certain regulated forms of gambling did not undermine the country’s broader public policy against credit-based gambling. But Rajah & Tann noted that an earlier Singapore Court of Appeal case had recognised that regulated casino gambling “carried out as part of an integrated resort, may not be contrary to public policy”. “Whether that distinction has any bearing on the enforceability of foreign judgements under the REFJA [Reciprocal Enforcement of Foreign Judgments Act] – particularly where the foreign casino is duly licensed and subject to a regulatory regime comparable to Singapore’s – is a question the law has yet to address,” the lawyers stated. Another unresolved issue concerns the competing public policy considerations surrounding gambling debts and the avoidance of legitimate financial obligations. Rajah & Tann noted that Singapore legislation also contains measures aimed at preventing debtors from avoiding judgement debts, including provisions concerning bankruptcy and the examination of judgement debtors. The High Court did not consider in detail how those policies should be reconciled with Singapore’s statutory policy against enforcement of gambling debts, according to the analysis. The lawyers also pointed to the role of international comity – friendly relations between jurisdictions – and reciprocity in recognising foreign judgements. They said the judgement did not explore whether an interpretation with a particular purpose of Singapore’s REFJA could narrow the scope of the public-policy objection. The law firm said it was also possible to argue that greater weight should be given to international comity, where gambling takes place at a regulated foreign casino, particularly when the patron involved is not Singaporean. Nonetheless, it said the current judicial trend favoured the approach adopted by the High Court, particularly following the 2023 repeal of Singapore’s Reciprocal Enforcement of Commonwealth Judgments Act and consolidation of the foreign-judgement regime under the REFJA. “Whether the Court of Appeal will have the opportunity to pronounce definitively on this issue remains to be seen,” noted the Rajah & Tann team. Until then, it added, the case involving Venetian Macau Ltd “represents the law as it stands under the REFJA; and it is a decision that is, in our view, more likely to be affirmed than reversed”.