Singapore and Fiji become first countries to ratify Singapore Mediation Convention

The United Nations Convention on International Settlement Agreements Resulting from Mediation, known as the Singapore Mediation Convention, was adopted by the UN in December 2018 and signed in Singapore in August last year.

Last week representatives of Fiji and Singapore deposited their instruments of ratification at the UN headquarters in New York.

Disputes expert Scheherazade Dubash of Pinsent Masons, the law firm behind Out-Law, said that since the convention will come into force six months after the third signatory state ratifies it into their domestic law, Singapore and Fiji's ratification was an important step towards the convention commencing operation.

“Although there is still work to be done to ensure that the convention acts as a catalyst for the development of mediation worldwide, this is a positive starting point, as the greater the number of signatories the greater its impact. One of the most important features of the convention is its reflection of an international willingness to recognise mediation as a globally acceptable form of dispute resolution,” Dubash said.

Signatories to the agreement last year included the US, China, Saudi Arabia, Qatar, South Korea and Turkey. The UK and other EU member states were not among the signatories and the EU is yet to determine whether it is eligible to sign the convention as a whole or if member states can do so individually.

The convention aims to support international trade and encourages the use of mediation when dealing with resolution of cross-border commercial disputes, addressing a problem whereby international mediation was repeatedly turned down as an alternative dispute resolution option for the reason that a settlement might not be readily enforceable in a different jurisdiction. The convention gives reassurance that a mediated outcome will have the same protection as international arbitration.

It defines mediation in broad terms, creating a presumption in favour of enforceability and setting out limited grounds on which enforcement may be validly declined.

“The mere fact that parties agree to mediate does not of course guarantee that a mutually agreed settlement will inevitably be reached. The heart of mediation lies in consensus between parties but once that consensus is reached and is incorporated into a settlement agreement it will be the certainty of enforcement of that agreement that makes the Singapore Convention attractive,” Dubash said.

“Crucially, it aims to accord meditation wider acceptance by providing an international standard for its recognition and enforcement, thereby reinforcing its credibility. If successful, the convention will give businesses the assurance that they can enter mediation and rely on any settlement reached,” Dubash said.