46 states including the US, China, India, Laos, Malaysia, Philippines, Republic of Korea, Sri Lanka, Brunei and Singapore have today signed the United Nations Convention on International Settlement Agreements Resulting from Mediation, known as the Singapore Convention. This is the highest number of first-day signatories of a UN trade convention. A full list of signatories can be found at the foot of this ebulletin.The Convention seeks to streamline the enforcement of international mediated settlement agreements, as the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the “New York Convention”) has done for arbitral awards.
Signatory states (and their courts) will recognise and enforce the terms of international mediated settlement agreements where, for example, a party refuses to comply with the settlement or attempts to re-litigate the dispute before the courts. The Convention amends the existing UN Model Law on International Commercial Conciliation (2002), and is accompanied by its model legislative text, available here. See our blog post linked here for more information on when and how the Convention applies.
The Convention is a significant step forward in promoting mediation as a viable alternative to traditional commercial dispute resolution processes like litigation and arbitration. We have seen an uptick in interest from clients in multi-tiered dispute resolution mechanisms in an attempt to de-escalate conflict and achieve more efficient resolution through mediation. Greater certainty in the enforcement of mediated settlement agreements should further bolster the popularity of such clauses, as well as ad hoc mediation at the point of dispute.
The Convention comes into force six months after at least three signatory states have formally ratified it. This should be kept under review.
We publish widely on ADR, in particular, mediation. Our guide to help organisations better deploy ADR and dispute avoidance strategies is here. Our ADR hub includes our practical guide series and ADR in Asia Pacific publications, as well as short updates on the key international trends and developments.