COVID-19: 6 Ways Businesses Can Maximise Their Downtime

By Ronald JJ Wong and Nee Yingxin

If your business is experiencing a slow-down because of the Circuit Breaker and social distancing measures during this COVID-19 outbreak, now is the best time to repair legal foundations, review internal systems, and position your business for when things pick up again.

Here are 6 key areas you should review.

1. PDPA compliance

Complying with the Personal Data Protection Act (“PDPA”) is not just about having a privacy policy on your website. Have you:

  • Appointed and trained a Data Protection Officer?
  • Reviewed all your processes to ensure that personal data is collected, processed, protected, and disclosed safely and in accordance with the PDPA?
  • Developed written internal procedures for collection, processing, protection, and disclosure of PDPA?
  • Developed a system to address requests by individuals to view and correct their personal data handled by your business?
  • Ensured sufficient cybersecurity measures to prevent data breaches?
  • Trained your staff on PDPA compliance?

Further, you may want to apply for Data Protection Trustmark (DPTM) certification to boost customers’ confidence in your business. Eligible organisations can consider applying for the Enterprise Singapore Enterprise Development Grant to cover some of the costs for DPTM certification and consultancy services.

2. Employment & HR practices and agreements

You may not have realised that the Employment Act has been amended since 1 April 2019.

Review and amend your employment agreements and practices to ensure they are aligned with the Employment Act and other applicable laws.

Do not assume that your non-compete, non-solicitation, and non-disclosure or confidentiality clauses will be legally enforceable. Legal principles from various court decisions apply. The legality of such clauses is highly context-specific.

We have seen employment disputes arising from unclear or inconsistent clauses. The likelihood of legitimate disputes will decrease with clearer drafting.

Further, with the constantly evolving COVID-19 situation, there are and will be many advisories, regulations, and guidelines applicable to employment. Regularly update yourself to finetune practices for compliance.

3. Shareholder or partnership agreements

While shareholder agreements are not mandatory, they are important for businesses as they govern the relationship between shareholders and business partners.

We have seen many shareholder disputes arising because of the lack of a shareholder agreement setting out clear terms on decision-making and veto rights (reserved matters), board of directors representation, information rights, shareholder exit or deadlock resolution mechanisms (pre-emption rights & buyouts), share valuation methods, etc.

Consider having a review of your business’ shareholder agreement to minimise the risk of disputes arising in the future.

4. Intellectual property (“IP”) and intangible assets

Key to your business is the brand, goodwill, and intangible IP assets like trademarks, processes, source codes, recipes, formulas, trade secrets, and inventions.

Business downtime is also good opportunity to innovate on your products. If so, you may be eligible to tap on the Enterprise Development Grant for this. Ensure the long-term profitability of the fruit of your research and product development with an IP protection and enforcement strategy.

Carry out a comprehensive assessment of your company’s IP assets. This includes reviewing patents protecting products and trademarks to safeguard your branding and name. You may also be party to licensing agreements that require review if circumstances have changed.

Do not also assume that ownership of IP has been vested in the company. We have seen disputes arising from exiting co-founders who claim that the IP had always been owned by them and not in the company. Ensure that all the founders have executed assignment agreements.

Consider the following:

  • Identify and consolidate an inventory of existing IP assets
  • Review existing IP protection
  • Identity areas of vulnerability in securing IP
  • Identify areas of opportunity and profitability
  • Engage a lawyer to handle registration with IPOS and vetting documents
  • Develop an IP enforcement strategy

5. Customer and vendor service agreements or terms and conditions

Many businesses are restructuring at this time or experiencing big changes to their supply chain.

Review the terms of your service agreements whether to customers or from vendors and develop systems and procedures to manage, track, and comply with contractual obligations. Consider drafting revised agreements to address issues and risks in this new business environment arising from the COVID-19 outbreak and the ‘new normal’ thereafter.

If your business deals in goods, review or draft terms and conditions of sale and purchase. Develop systems to track inventory to correspond with contractual obligations.

6. Operational systems and risk management

Review and optimise your operational systems and processes to increase efficiency and improve risk management.

A Harvard Business Review article noted that companies invest in and adopt technological transformation during a recession as it helps them to become agile and optimise for when the economy picks up. You may be eligible to tap on the Enterprise Development Grant to help you invest in automation, technology, and process redesign.

Do this in tandem with a holistic risk management approach. We have assisted clients to comprehensively review their Standard Operating Procedures and internal policies to assess and manage risks even as they do so to reduce costs and improve productivity.

Once you have built strong foundations in the above legal and commercial risk areas, you will be better equipped to lead your organisation through the choppy waters of the COVID-19 outbreak and ride the market wave when it comes.

This legislation update was first published on and has been adapted with permission.

Corporate & Commercial Dispute Resolution Intellectual Property & Media Corporate Secreterial Services Corporate Finance Corporate Insolvency & Restructuring Corporate Regulatory & Compliance Employment Personal Data Protection