A new UN treaty is set to be signed for the facilitation of enforcement of cross-border mediation agreements. Named after Singapore, the Singapore Convention on Mediation is a big representation of Singapore as a hub of dispute resolution.
When it comes to commercial disputes, clients tend to prioritize quick solutions. There are a couple ways in which that can be arranged. Firstly, you can litigate in court to have a judge make a legal ruling regarding the dispute with public witnesses. Another solution would be to go to arbitration, to have an arbitrator do the same, but without public witnesses. Asian companies tend to prefer neither option. A reason for that is the loss of control when either of these options are undertaken, and regardless of the result of the ruling, the conflicting companies are unlikely to resume a commercial relationship.
To combat this, lawyers have been slowly exploring other options such as mediation, a process in which two parties sit in a closed room with an independent liaison called a mediator. The third party mediator does not make any rulings but instead facilitates discussions in hopes two bring the two parties together. This helps the situation become less of a dispute and more of a negotiation.
This solution has also shown to be successful. Global surveys show that over 80 per cent of cases that undergo mediation are settled on the same day, with many more being settled thereafter. Some problems that are present with this, however, include the difficulty of cross-border enforcement.
The remedy to this difficulty was addressed by the United Nations Commission on International Trade Law with the UN Convention on International Settlement Agreements Resulting from Mediation, alternatively the Singapore Convention on Mediation. This allows settlement agreements using mediations to be enforced internationally in any of the countries that ratify the treaty. This will provide a shortcut for the legal processes involved in mediation.
In naming the treaty after Singapore, the country is recognised as a leader in friendly and civil solutions for disputes and disagreements, which pairs with the countries growing reputation as a resolution hub. A survey conducted by the Singapore Academy of Law found that 63 percent of the 606 legal practitioners and in-house counsels engaging in cross-border transactions in Asia prefer Singapore as their preferred venue to resolve disputes.
The signing ceremony for the Singapore Convention will take place here on Aug 7, just a couple of days before National Day, a nice birthday gift for Singapore.
