In May 2015, Singapore Customs revised its Guide to "Keeping and Maintaining Records in Image System". The Guide includes a new requirement that where importers, exporters and their agents (collectively, "Traders") use a storage system to store and retrieve records (an "Image System") without retaining physical copies, they must use a system with proven hardware and software components reputable for security, quality and performance to satisfy their retention obligations.
If Traders fail to comply with their statutory retention obligations, they are liable to be fined up to SGD 10,000 (USD 7,100) and/or imprisoned up to 3 years.
Traders who rely on an Image System to store records without retaining physical copies should ensure that they comply with the new provisions of the Guide.
New Requirement in the Guide
Traders who use an Image System to store trade documents and records relating to the purchase, sale, import or export of goods, may comply with their document retention obligations under the Customs Act by adhering to the provisions of the Guide.
Under the Guide, Traders must ensure that the Image System that they use includes "proven hardware and software components reputable for security, quality and performance." The responsibility for ensuring compliance with this requirement remains with Traders who outsource the maintenance of their records to third-party service providers.
The new requirement in the Guide was included in response to legislation providing that the stability and reliability of an Image System are relevant factors for courts to consider when an image is offered for admission into evidence under the Evidence Act, or Evidence (Computer Output) Regulations (collectively, the "Evidence Legislation").
However, it should be noted that the Guide does not alter the requirements for the admission of evidence under the Evidence Legislation.
Possible Effects on Traders
As the Guide does not define what constitutes "proven" components, Traders should remain cognizant of products offered by market leaders in the storage system, software and service industry, and ensure that the products they use are stable and reliable.
Further, the new requirement raises a question as to whether popular cloud storage facilities meet the "proven" criterion, as they may not offer the same security, quality and performance as established hardware and software systems.
Finally, all original documents must be kept unless storage of the records on an Image System has been undertaken in accordance with the provisions of the Guide.
Contributors – Yi Lin Seng & Quan Nguyen