Commercial Litigation Lawyers Singapore 2026: Third‑party Funding, Maintenance & Cost‑shifting

Singapore’s Civil Justice Reforms 2026 have reshaped the landscape for commercial litigation lawyers in Singapore, introducing three changes that every in‑house counsel and CFO must now factor into dispute strategy: the formal recognition of third‑party funding for prescribed disputes, the abolition of the torts of maintenance and champerty, and a revised cost‑shifting framework that gives judges broader discretion over who bears litigation expenses. For claimants weighing whether to pursue a commercial claim, and for respondents budgeting their defence, these reforms alter the economics of every case.

This guide provides a practical, decision‑oriented walkthrough of each reform, complete with checklists, worked examples and tactical considerations for the Singapore International Commercial Court (SICC), so that corporate stakeholders can make informed funding and settlement decisions in the new regime.

TL;DR, Key Decisions for In‑House Teams

Can you use third‑party funding? Yes, if your dispute falls within the prescribed categories and you engage a qualifying funder. Has maintenance and champerty risk disappeared? Largely, though contractual and ethical safeguards remain. Will cost‑shifting hit harder? Potentially, judges now have wider discretion, making early budgeting and settlement modelling essential.

Here is what each scenario looks like under the 2026 rules:

• Claimant with third‑party funding. Greater financial firepower, but the funder will expect robust case assessment, milestone reporting, and a share of any recovery. Cost‑shifting exposure may extend to the funder in certain circumstances.
• Claimant self‑funding. Full control over litigation strategy, but increased cost‑shifting risk under the new presumptions means tighter budgeting is non‑negotiable.
• Respondent budgeting a defence. The opponent may now be better capitalised through funding. Security‑for‑costs applications remain available, but the tactical calculus has shifted. Early settlement modelling against realistic cost‑recovery scenarios is critical.

What Changed in the Civil Justice Reforms 2026, Overview for Commercial Litigation Lawyers in Singapore

The Civil Justice Reforms 2026 represent the most significant overhaul of Singapore’s litigation framework in over a decade. Building on the incremental liberalisation that began with the Civil Law (Amendment) Act 2017, which first permitted third‑party funding for international arbitration and prescribed proceedings, the 2026 reforms extend, formalise and broaden the funding regime while eliminating legacy doctrinal barriers that had constrained litigation finance.

Three headline changes matter most for commercial litigants and their advisers:

• Formalisation of third‑party funding for prescribed disputes. The reforms expand the categories of proceedings for which third‑party funding is expressly permitted and regulated. The prescribed list now covers domestic High Court proceedings meeting certain value thresholds, SICC proceedings, and international arbitration (which was already covered). Qualifying funders must meet capital‑adequacy requirements, and funding agreements must comply with disclosure and contractual‑form standards set out in subsidiary legislation.
• Abolition of maintenance and champerty. The torts of maintenance (supporting another party’s litigation without lawful justification) and champerty (funding litigation in exchange for a share of proceeds) have been formally abolished. These doctrines had created legal uncertainty around the enforceability of funding arrangements and assignments of causes of action.
• Revised cost‑shifting rules. The reforms introduce updated principles governing how litigation costs are allocated between parties. Judges now have broader, more structured discretion, guided by new presumptions and factors, to order costs against unsuccessful parties, to adjust the scale of recoverable costs, and, in certain circumstances, to make cost orders against non‑party funders.

Scope and Applicability

The prescribed‑dispute framework is central to the funding reforms. Not every commercial claim qualifies. The categories are defined by subsidiary legislation and, as of the 2026 amendments, typically cover:

• International arbitration proceedings (carried over from the 2017 regime)
• Proceedings in the SICC
• Domestic High Court proceedings where the claim value exceeds a prescribed threshold
• Related court proceedings (such as applications to set aside arbitral awards) connected to a funded proceeding

In‑house teams should verify at the outset whether their specific dispute falls within the prescribed list, as funding a non‑prescribed proceeding may still raise regulatory concerns even after the abolition of champerty.

Oversight and Enforcement

The Ministry of Law retains oversight of the third‑party funding framework. Funders must be professional funders meeting specified criteria, typically, a minimum paid‑up capital or assets‑under‑management threshold. The courts exercise supervisory jurisdiction over funding arrangements through disclosure requirements and their inherent power to manage proceedings, including the power to make adverse cost orders against funders who fail to comply with disclosure obligations.

Key Reforms at a Glance

Third‑Party Funding in Singapore: How It Works Under the 2026 Reforms

Third‑party litigation funding, sometimes referred to as litigation finance, is an arrangement where a commercial funder who is not a party to the dispute agrees to finance some or all of a claimant’s legal costs in exchange for a share of any damages or settlement recovered. The funder typically receives either a multiple of its investment or a percentage of the recovery, and bears the downside risk: if the claim fails, the funder loses its investment and the funded party owes nothing back.

Under the 2026 framework, litigation funding in Singapore is available through several models:

• Single‑case funding. A funder finances one specific claim. This is the most common model for high‑value commercial disputes.
• Portfolio funding. A funder finances a basket of claims held by one party or a group of related parties, cross‑collateralising risk across the portfolio. This model is increasingly popular with corporate claimants managing multiple disputes.
• After‑the‑event (ATE) insurance. Strictly speaking not funding, but closely related, an insurer provides cover for adverse cost orders in exchange for a premium, often contingent on the outcome. ATE is frequently paired with third‑party funding to create a comprehensive risk‑transfer package.

Qualifying funders include dedicated litigation‑finance houses, specialist boutique funds, and institutional investors with litigation‑finance arms. Insurers offering ATE products are a distinct but complementary category.

Key Contract Terms to Watch

Funding agreements are complex commercial contracts. In‑house counsel should pay close attention to:

• Funder’s return. Typically expressed as a multiple of the amount funded (commonly two to four times the investment) or a percentage of the recovery (commonly 20–40 per cent), whichever is greater.
• Control provisions. Most funders will require consultation rights on key decisions, particularly settlement. Industry observers expect the 2026 disclosure regime to increase scrutiny of control clauses, making it important that funding agreements clearly preserve the funded party’s autonomy over litigation strategy.
• Termination triggers. Funders typically reserve the right to withdraw funding if the case merits deteriorate materially. The funded party must understand the financial consequences of withdrawal, including whether costs incurred to that point must be repaid.
• Adverse‑cost cover. Does the funder indemnify the funded party against adverse cost orders? If not, separate ATE insurance is advisable.

Regulatory and Approval Steps

A qualifying funder must satisfy the prescribed capital and governance requirements. The funded party’s lawyers must disclose the existence and identity of the funder to the court and, in most circumstances, to the opposing party. Non‑disclosure can result in cost sanctions or other adverse orders. Early engagement with litigation counsel to structure the funding arrangement, and manage disclosure timing, is essential.

Maintenance and Champerty, What Changed and What It Means

For centuries, the doctrines of maintenance and champerty served as common‑law checks on third‑party involvement in litigation. Maintenance prohibited a stranger from supporting another’s lawsuit without lawful justification. Champerty, a subspecies of maintenance, prohibited financing litigation in return for a share of the proceeds. Both were actionable as torts and, historically, as criminal offences.

Singapore had already carved out exceptions to these doctrines through the 2017 amendments, but the exceptions were narrow and created a patchwork regime. The Civil Justice Reforms 2026 resolve this by abolishing maintenance and champerty entirely as torts and as grounds for invalidating otherwise lawful agreements. The likely practical effect is that funding arrangements can no longer be challenged solely on the basis that they constitute maintenance or champerty, a significant reduction in legal risk for both funders and funded parties.

However, abolition does not create a regulatory vacuum. Several safeguards remain:

• Contractual enforceability standards. Funding agreements must still comply with general contract law, they must be entered into freely, on reasonable terms, and without undue influence or misrepresentation.
• Professional‑conduct obligations. Lawyers remain bound by the Legal Profession (Professional Conduct) Rules and must not allow funders to compromise their duties to the client or the court.
• Public‑policy limits. Courts retain a residual jurisdiction to refuse enforcement of agreements that are contrary to public policy, even if they no longer technically constitute champerty.

Funding Agreements After Abolition, Enforceability Checklist

To ensure enforceability of a funding agreement in the post‑abolition landscape, in‑house counsel should confirm:

• The funder meets the prescribed qualifying criteria
• The agreement complies with any prescribed‑form requirements
• Control provisions preserve the funded party’s decision‑making autonomy
• The agreement does not create conflicts of interest for litigation counsel
• Disclosure obligations to the court and opposing party are clearly addressed
• Termination, withdrawal and cost‑indemnity provisions are unambiguous

Revised Cost‑Shifting Rules: Budgeting and Settlement Modelling

The cost‑shifting rules under the Civil Justice Reforms 2026 represent a recalibration of how litigation expenses are allocated. Under the traditional “loser pays” principle, the unsuccessful party was generally ordered to pay the successful party’s reasonable costs. The 2026 reforms retain this baseline principle but introduce new factors and broader judicial discretion that make outcomes less predictable, and early budgeting more important.

Key changes that commercial litigation lawyers in Singapore must advise on include:

• Structured discretion. Judges must now consider a codified list of factors when making cost orders, including the conduct of the parties, the complexity of the issues, and whether any party unreasonably refused mediation or alternative dispute resolution.
• Non‑party cost orders. Courts may, in appropriate cases, make cost orders against third‑party funders, particularly where the funder exercised significant control over the litigation or failed to comply with disclosure obligations.
• Proportionality emphasis. Recoverable costs are subject to a proportionality assessment, meaning that even a successful party may not recover all costs if they are disproportionate to the value or complexity of the claim.

How to Estimate Exposure, Illustrative Cost‑Shifting Model

The following is an illustrative example only and does not constitute legal advice. Actual cost outcomes depend on the specific facts, the court’s assessment and applicable rules.

Insurance and ATE Considerations

Given the broader judicial discretion under the 2026 cost‑shifting rules, after‑the‑event insurance has become a more important component of litigation finance planning. ATE policies can cap a party’s exposure to adverse cost orders, typically covering the opponent’s legal costs if the funded claim fails. Early indications suggest that ATE premiums for Singapore commercial disputes are rising modestly as funders and insurers adjust to the new discretionary framework. In‑house teams should obtain ATE quotes as part of the funding due‑diligence process, not as an afterthought.

SICC Procedure 2026, Tactical Considerations for Commercial Cases

The Singapore International Commercial Court continues to evolve as a venue of choice for cross‑border commercial disputes. The SICC procedure updates implemented alongside the Civil Justice Reforms 2026 introduce several changes that directly affect funded cases and the tactical decisions of commercial litigation lawyers in Singapore.

The SICC’s procedural framework already offered features attractive to international litigants, including more flexible rules of evidence, the ability to engage foreign lawyers, and streamlined case management. The 2026 updates build on this foundation with specific attention to funding disclosure, interim relief and enforcement.

Interim Remedies and Enforcement

The 2026 procedural updates clarify the SICC’s powers to grant interim relief in funded proceedings, including:

• Freezing orders. The court’s jurisdiction to grant Mareva injunctions in SICC proceedings has been reaffirmed, with guidance on how the existence of third‑party funding affects the assessment of risk of dissipation.
• Security for costs. Respondents can apply for security for costs against a funded claimant. Industry observers expect the courts to consider the funder’s financial standing and willingness to provide adverse‑cost indemnities as relevant factors. A well‑capitalised funder that has provided ATE cover may reduce the respondent’s prospects of obtaining security.
• Enforcement across borders. SICC judgments benefit from Singapore’s enforcement treaty network and reciprocal enforcement arrangements. Funded parties should factor enforcement strategy into the initial case assessment, as funders will evaluate the recoverability of any judgment before committing capital.

Disclosure Obligations and Funder Confidentiality

The SICC practice directions require funded parties to disclose the existence of a funding arrangement and the identity of the funder. This disclosure must typically be made at the earliest opportunity, in practice, at or before the first case‑management conference.

A tension exists between disclosure obligations and funder confidentiality. The terms of the funding agreement itself, including the funder’s return structure and termination rights, are generally not required to be disclosed to the opposing party, although the court may order disclosure of specific terms if they are relevant to a procedural application (such as security for costs or a non‑party cost order). Counsel should negotiate clear confidentiality carve‑outs in the funding agreement and be prepared to manage disclosure on a staged basis in coordination with the court’s directions.

When to Seek Funding, Practical Checklist for Claimants and In‑House Counsel

Not every commercial dispute warrants third‑party funding. The decision should be driven by a structured assessment of the claim’s legal merits, commercial value, and the organisation’s risk appetite. The following dispute finance checklist provides a step‑by‑step framework for evaluating whether to pursue funding under Singapore’s 2026 regime.

Initial Screening, Financial and Legal

Before approaching any funder, in‑house teams should complete a preliminary self‑assessment:

• Is the dispute prescribed? Confirm that the claim falls within the prescribed categories for third‑party funding.
• What is the realistic claim value? Funders typically require a minimum claim value, often in the range of S$5 million or more for single‑case funding, to justify their investment and return expectations.
• What are the legal merits? Obtain a preliminary merits assessment from litigation counsel. Funders will commission their own due diligence, but a weak merits case will not attract funding.
• Is the defendant good for the money? A successful judgment is worthless if the defendant is insolvent or has no reachable assets. Assessment of the defendant’s financial position and asset location is essential.
• What is the expected duration? Longer cases require more capital and reduce the funder’s internal rate of return. Cases expected to last beyond three to four years may face more stringent funding terms.

Due Diligence on Funder

Negotiation Points

Once a funder is selected, the negotiation phase is critical. Key leverage points for funded parties include:

• Return structure. Push for a percentage‑of‑recovery model with a cap, rather than an uncapped multiple of investment. This protects the funded party’s net recovery in high‑value outcomes.
• Settlement approval. Ensure the funding agreement requires the funder to act reasonably in approving or declining settlement offers. A “reasonable funder” standard, rather than absolute discretion, is preferable.
• Budget flexibility. Negotiate a mechanism for budget increases if the case becomes more complex than anticipated, rather than a fixed budget with no adjustment provision.
• Confidentiality protections. Require the funder to treat all case information as privileged and confidential, and include clear restrictions on the funder’s ability to share information externally.

Post‑Funding Management

After the funding agreement is executed:

• Make the required court and opposing‑party disclosures promptly
• Establish a regular reporting cadence with the funder, typically quarterly or at each litigation milestone
• Ensure litigation counsel understands their dual communication obligations to the client and (where contractually agreed) the funder, while preserving privilege
• Review the funding arrangement at each major milestone, case management conference, close of pleadings, discovery, and any settlement window, to confirm continued alignment between funded party and funder objectives

Funding Economics Snapshot

All figures are indicative market ranges and do not constitute financial or legal advice. Actual terms vary by funder, case profile and market conditions.

Practical Worked Examples

Example 1, Shareholder Dispute

Scenario. A minority shareholder in a Singapore‑incorporated company alleges oppression and seeks a buyout order valued at approximately S$15 million. The shareholder’s personal resources are insufficient to fund a multi‑year High Court action.

• Funding outcome. A commercial litigation funder agrees to finance the claim on a portfolio basis (the shareholder has a related contractual claim against the same group). The funder commits S$1.5 million in legal costs in exchange for 30 per cent of any recovery.
• Cost‑shifting outcome. The claim succeeds. The court awards costs to the shareholder on a standard basis. Under the 2026 proportionality assessment, recoverable costs are set at S$350,000, less than the total costs incurred but still a significant offset.
• Settlement implication. During the litigation, the respondent offered S$8 million. The funder’s 30 per cent share of S$8 million (S$2.4 million) compared unfavourably with the funder’s minimum‑return floor of S$4.5 million, creating friction. The funding agreement’s “reasonable funder” clause was critical to resolving the disagreement and proceeding to trial.

Example 2, International Contract Claim (SICC)

Scenario. A European manufacturer brings a breach‑of‑contract claim in the SICC against a Southeast Asian distributor. The claim is valued at S$25 million. The manufacturer seeks funding to avoid tying up working capital.

• Funding outcome. A global litigation funder provides single‑case funding of S$2 million, with a return of 2.5× the funded amount or 25 per cent of recovery, whichever is greater.
• Cost‑shifting outcome. The claim is partially successful, the court awards S$18 million. Costs are awarded to the claimant, but reduced by 20 per cent because the claimant declined the court’s suggestion of early mediation.
• Enforcement. The SICC judgment is enforced in the distributor’s home jurisdiction under a reciprocal enforcement arrangement. The funder’s due diligence on asset location, conducted before committing capital, proved essential to achieving a complete recovery.

Conclusion and Recommended Next Steps

The Civil Justice Reforms 2026 have created a more sophisticated, and more demanding, environment for commercial dispute resolution in Singapore. Third‑party funding is now a mainstream tool, maintenance and champerty no longer stand as doctrinal barriers, and cost‑shifting rules require earlier and more rigorous financial planning. For any organisation involved in or contemplating a significant commercial dispute, the following steps are recommended:

1. Run the internal screening checklist. Assess whether your dispute qualifies for third‑party funding and whether the claim economics support a funding application.
2. Engage experienced commercial litigation lawyers in Singapore. The 2026 reforms have introduced new procedural requirements and strategic considerations that require specialist advice from the outset.
3. Test the funder market early. Approach two to three qualifying funders to compare terms, conduct due diligence and negotiate the best structure for your case.
4. Budget for cost exposure under the new rules. Model your worst‑case and best‑case cost‑shifting outcomes using the revised discretionary framework, and consider ATE insurance as part of your risk‑transfer strategy.
5. Revisit strategy at every milestone. The combination of funding obligations, disclosure requirements and cost‑shifting risk means that litigation strategy must be reviewed at each procedural stage, not just at the point of filing.

For assistance identifying experienced commercial litigation lawyers in Singapore, consult the Global Law Experts directory to connect with practitioners who specialise in funded disputes, SICC procedure and the 2026 reforms.

Sources

1. Supreme Court of Singapore, SICC Practice Directions and Rules
2. eLitigation, Singapore Court Judgments
3. Allen & Gledhill, Litigation Practice
4. Chambers Practice Guides, Litigation Funding
5. <a href="https://www.legal500.com/