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MoU signed to help SMEs resolve lease disputes faster, cheaper

A Memorandum of Understanding was signed between the Singapore Business Federation and the Singapore Mediation Centre, which aims to promote mediation as their preferred dispute resolution channel.

SINGAPORE: The Singapore Business Federation (SBF) and the Singapore Mediation Centre (SMC) on Monday (Oct 12) signed a new Memorandum of Understanding to help small businesses resolve disputes with their landlords.

The MoU aims to promote mediation as the preferred dispute resolution channel.

Under this MoU, tenants and landlords of business premises will get preferential rates starting from S$80.25 per party per hour. The first two hours of mediation are free.

The SMC will also expedite mediation requests to resolve tenancy disputes. The SBF said the move will help to save time and up to 50 per cent of legal costs for businesses.

For instance, one tenancy dispute, which would have taken about two years to reach the court, was settled through mediation at SMC within one day, the SMC said.

The MoU is developed under the Fair Tenancy Framework (FTF), which was introduced in January 2015 to establish a set of clear leasing guidelines for small businesses looking to rent premises.

The FTF aims to help tenants and landlords understand the key terms and conditions of the lease agreement, the respective roles and responsibilities and the implications of prevalent industry lease clauses. It also serves as a checklist for negotiation between tenants and landlords.

The SBF says there are currently no laws or industry standards governing lease agreements, and tenants and landlords tend to enter into contracts where one party has greater influence over the other.

Other than promoting mediation, the SBF is also pushing for more rental data to be provided by public agencies such as the Housing and Development Board and the Urban Redevelopment Authority.