Case Details
- Citation: [2020] SGCA 20
- Title: Steep Rise Limited v Attorney-General
- Court: Court of Appeal of the Republic of Singapore
- Date of Decision: 24 March 2020
- Lower Court / Originating Process: Originating Summons No 898 of 2017 (Summons No 4614 of 2018)
- Civil Appeal No: Civil Appeal No 30 of 2019
- Judges: Tay Yong Kwang JA, Steven Chong JA and Woo Bih Li J
- Appellant: Steep Rise Limited (British Virgin Islands)
- Respondent: Attorney-General
- Procedural Posture: Appeal against the High Court’s dismissal of an application to discharge a restraint order made under s 29 MACMA
- Statutory Provisions Invoked: Section 29 of the Mutual Assistance in Criminal Matters Act (Cap 190A, 2001 Rev Ed); paragraph 7(1) of the Third Schedule to MACMA
- Rules of Court Provision Mentioned: Order 89B Rule 11 of the Rules of Court (Cap 322, R5, 2014 Rev Ed)
- Bank / Account: Bank of Singapore Limited, 63 Market Street, #22-00 Bank of Singapore Centre, Singapore 048942 (BOS Account)
- Beneficial Owner / Director: Fabrice Touil (sole director; beneficial owner)
- Key Issues on Appeal: Duty of full and frank disclosure in MACMA ex parte applications; whether a risk of dissipation of assets must be shown
- Judgment Length: 23 pages, 6,309 words
- Outcome on Appeal (as stated in extract): Appeal dismissed; costs of the appeal fixed at $40,000 (inclusive of disbursements) to the AG
Summary
In Steep Rise Limited v Attorney-General ([2020] SGCA 20), the Court of Appeal considered the scope of the Attorney-General’s duty of full and frank disclosure when applying ex parte for a restraint order under Singapore’s Mutual Assistance in Criminal Matters Act (MACMA). The case arose from French investigations into VAT fraud and money laundering, which led to requests for assistance from the French Ministry of Justice and ultimately to a restraint order over funds held in a Singapore bank account beneficially owned by Fabrice Touil through Steep Rise Limited.
The appellant sought to discharge the restraint order, arguing that the Attorney-General had breached the duty of full and frank disclosure by failing to disclose (i) the French authorities’ stated purpose for seeking the restraint (to guarantee the effectiveness of a fine rather than to support a confiscation order) and (ii) that the amount allegedly connected to the fraud was approximately €3m at most. The appellant also argued that the restraint order was defective and ultra vires, and further contended that the Attorney-General should have demonstrated a risk of dissipation of the funds because the account was already subject to a seizure order under Singapore’s Criminal Procedure Code.
The Court of Appeal dismissed the appeal. It affirmed that, once the statutory requirements for a restraint order under MACMA are satisfied, the court must grant the order sought. It also held that the alleged non-disclosures were not material in the circumstances, and that MACMA does not impose a general requirement to show a risk of dissipation of assets for the making of a restraint order.
What Were the Facts of This Case?
Steep Rise Limited is a company incorporated in the British Virgin Islands. It was beneficially owned by Fabrice Touil, who was also the company’s sole director. The dispute concerned funds held in a Singapore bank account maintained by Steep Rise Limited with Bank of Singapore Limited (the “BOS Account”). The restraint order was sought and made in aid of foreign criminal proceedings in France.
In 2010, French authorities investigated VAT fraud and money laundering connected to the French carbon emissions market. The investigations revealed that a French company, B Concept, committed VAT fraud by purchasing tax-free carbon emission allowances and selling them to French companies with VAT included. The VAT collected from buyers was not paid to the French Treasury; instead, it was retained by B Concept. The proceeds were then laundered into bank accounts held by companies incorporated in various jurisdictions, which were beneficially owned by Mr Touil, his siblings, and other related persons identified as part of the fraud. The French government estimated that the fraud caused lost tax revenue of approximately €68.5m.
After the French authorities discovered suspicious transfers into a Singapore bank account owned by Axcel Inc, the French Ministry of Justice issued an International Request for Legal Assistance in Criminal Matters dated 17 September 2014 (the “First Request”) to the Attorney-General. The First Request sought, principally, banking documents relating to the Axcel Inc account and requested freezing of that account. With the documents obtained pursuant to the First Request, the French authorities discovered that the funds in the Axcel Inc account had been transferred into the BOS Account. Consequently, on 28 October 2015, the French Ministry of Justice sent a second International Request (the “Second Request”) to the Attorney-General, again seeking banking documents relating to the BOS Account and requesting freezing of the BOS Account.
On 8 August 2017, the Attorney-General filed an ex parte application in Originating Summons No 898 of 2017 (OS 898) seeking a restraint order over the funds in the BOS Account. The application was made under s 29 of MACMA read with paragraph 7(1) of the Third Schedule. The High Court granted the restraint order on 22 August 2017. Under the order, the appellant, the bank, and Mr Touil were restrained from dealing with all or any part of the funds in the BOS Account. Subsequently, on 31 August 2017, French criminal proceedings were commenced against Mr Touil in the High Court of Paris, and the Attorney-General adduced a certificate confirming this fact by way of a supplementary affidavit in OS 898 on 11 December 2017.
What Were the Key Legal Issues?
The appeal raised two principal legal issues. First, the Court had to determine the scope and application of the Attorney-General’s duty of full and frank disclosure in MACMA applications made ex parte. The appellant argued that the Attorney-General’s affidavit supporting OS 898 contained material omissions. In particular, the appellant contended that the Attorney-General failed to disclose that the French authorities’ stated purpose for seeking the restraint under the Requests was to “guarantee the effectiveness of a fine” rather than to support a confiscation order that may be made in the foreign proceedings. The appellant also argued that the Attorney-General failed to disclose that any payment received in connection with the VAT fraud and money laundering offences was approximately €3m at most.
Second, the Court had to address whether, in the context of MACMA restraint orders, the Attorney-General must show a risk of dissipation of the restrained assets. The appellant relied on the fact that the BOS Account had already been seized under s 35 of Singapore’s Criminal Procedure Code (the “CPC seizure order”) and argued that, because of this existing seizure, there was no risk that the funds would be dissipated. The appellant therefore submitted that the restraint order should not have been granted (or should be discharged) without evidence of such risk.
Related to these issues, the appellant also challenged the validity of the restraint order on the basis that it was defective and ultra vires, asserting that the restraint was not within the scope of MACMA given the alleged purpose of the foreign request and that the restraint should not have extended beyond the alleged €3m figure.
How Did the Court Analyse the Issues?
The Court of Appeal began by setting out the statutory framework for MACMA restraint orders. Section 29 of MACMA empowers the court to restrain dealing with property in Singapore that may be the subject of foreign confiscation orders. Paragraph 7(1) of the Third Schedule provides the procedural and substantive conditions that must be satisfied for such restraint to be ordered. The Court emphasised that the MACMA regime is designed to facilitate international co-operation in criminal matters by enabling Singapore courts to take protective measures in support of foreign proceedings.
On the duty of full and frank disclosure, the Court analysed the nature of ex parte applications and the expectations placed on the applicant. Ex parte applications require the applicant to present the court with all material facts so that the court can make an informed decision without the benefit of adversarial testing. The appellant’s case focused on two alleged omissions: (i) the purpose stated in the Requests (fine effectiveness rather than confiscation) and (ii) the alleged maximum amount (€3m) connected to the fraud.
As to the first omission, the Court considered the content of the affidavit supporting OS 898. The affidavit referred to two principal documents: a certificate issued by the Tribunal de Grande Instance de Paris on 22 June 2017 (the “1st Certificate”) and an email from the French authorities dated 26 July 2017 confirming that judicial proceedings would be commenced in August 2017. Importantly, while the affidavit did not expressly refer to the First and Second Requests, it deposed that there were reasonable grounds for believing that a confiscation order may be made in the French proceedings over the funds in the BOS Account. The High Court had accepted that the requirements under s 29(1)(b) were satisfied. The Court of Appeal agreed that, in substance, the affidavit provided the court with the relevant basis for believing that foreign confiscation could be made.
The Court also addressed the appellant’s argument that the French authorities’ stated purpose was limited to guaranteeing the effectiveness of a fine. The Court’s reasoning turned on whether the alleged omission was material to the statutory requirements for a restraint order. The Court noted that French law allowed for confiscation in value of the payment received in connection with the fraud. On that basis, the restraint order was not limited to the amount of the payment allegedly received; rather, the whole of the BOS Account could still be subject to a confiscation order in the French proceedings. This reasoning undermined the appellant’s attempt to recast the foreign request as one that fell outside MACMA’s confiscation-oriented framework.
Regarding the second omission (the €3m figure), the Court again focused on materiality. Even if the appellant’s characterisation of the amount connected to the fraud was accepted, the legal consequence in French law—confiscation in value—meant that the restraint could still extend beyond €3m. The Court therefore concluded that the alleged non-disclosures did not amount to a breach of the duty of full and frank disclosure that would warrant discharge of the restraint order. In other words, the omissions were not shown to be capable of affecting the court’s assessment of whether the statutory prerequisites were met.
On the requirement to show a risk of dissipation, the Court of Appeal addressed the appellant’s reliance on the fact that the BOS Account was already subject to a CPC seizure order. The Court held that MACMA does not require the Attorney-General to demonstrate a risk of dissipation as a condition for the making of a restraint order. The Court relied on its earlier reasoning in Re Section 22 of MACMA ([2009] 1 SLR(R) 283), which the High Court had cited. In Re Section 22, the court had clarified that once the statutory requirements are satisfied, the court must make the order sought. The Court of Appeal in Steep Rise reaffirmed that approach: the restraint order is triggered by the satisfaction of the MACMA criteria, not by an additional discretionary assessment of dissipation risk.
Finally, the Court considered the appellant’s ultra vires and scope arguments. The appellant contended that the restraint order was defective because it restrained more than €3m and because the foreign purpose was allegedly to guarantee a fine rather than confiscation. The Court’s analysis of French confiscation in value provided the key response. Since confiscation could be made in value, restraining the entire BOS Account was consistent with the possibility of a foreign confiscation order. Accordingly, the restraint order was within the scope contemplated by MACMA.
What Was the Outcome?
The Court of Appeal dismissed the appeal and upheld the High Court’s decision to refuse discharge of the restraint order. It affirmed that the Attorney-General’s application met the statutory requirements under s 29 of MACMA read with paragraph 7(1) of the Third Schedule.
In addition, the Court ordered the appellant to pay costs of the appeal fixed at $40,000 (inclusive of disbursements) to the Attorney-General. The practical effect was that the restraint over the BOS Account remained in place, continuing to support the foreign confiscation process in France.
Why Does This Case Matter?
Steep Rise Limited v Attorney-General is significant for practitioners because it clarifies how the duty of full and frank disclosure operates in MACMA ex parte applications. While ex parte proceedings demand candour and completeness, the Court of Appeal’s focus on materiality is crucial. The case indicates that not every omission will justify discharge; the omission must be shown to be capable of affecting the court’s decision on the statutory prerequisites for restraint.
The decision also provides important guidance on the structure of MACMA restraint orders. By holding that there is no general requirement to show a risk of dissipation, the Court of Appeal reinforces the non-discretionary character of the restraint mechanism once statutory conditions are met. This matters for banks, corporate respondents, and counsel advising on international asset freezing: the existence of parallel domestic seizure measures does not necessarily negate the need for MACMA restraint if the MACMA criteria are satisfied.
For lawyers, the case is also a reminder that the foreign law characterisation of confiscation mechanisms can be decisive. The Court’s reasoning that French law permitted confiscation in value supported the breadth of the restraint order. Accordingly, counsel should carefully assess not only the foreign authority’s stated purpose but also the substantive legal consequences under foreign confiscation regimes when evaluating whether restraint is properly within MACMA’s scope.
Legislation Referenced
- Mutual Assistance in Criminal Matters Act (Cap 190A, 2001 Rev Ed) — s 29
- Mutual Assistance in Criminal Matters Act (Cap 190A, 2001 Rev Ed) — Third Schedule, paragraph 7(1)
- Rules of Court (Cap 322, R5, 2014 Rev Ed) — Order 89B Rule 11
- Criminal Procedure Code (Cap 68, 2012 Rev Ed) — s 35 (CPC seizure order referenced in facts)
Cases Cited
- [2020] SGCA 20 (Steep Rise Limited v Attorney-General) (reported decision under analysis)
- Re Section 22 of the Mutual Assistance in Criminal Matters Act [2009] 1 SLR(R) 283
Source Documents
This article analyses [2020] SGCA 20 for legal research and educational purposes. It does not constitute legal advice. Readers should consult the full judgment for the Court's complete reasoning.