Turkey: Singapore Convention On Mediation

Last Updated: 11 September 2019
Article by Melissa Balikci

Introduction

The United Nations Commission on International Trade Law approved the final draft of the Convention on International Settlement Agreements Resulting from Mediation[1], also known as the Singapore Convention ("Convention" or "Singapore Convention") on 26 June 2018. The United Nations General Assembly adopted the Convention on 20 December 2018. The signing ceremony of the Convention will be held on 7 August 2019 in Singapore[2], and will come into force once it is ratified by at least three member states[3].

As it is clear from the name of the Convention, it deals with the enforcement of international settlement agreements resulting from mediation and, thus, aims to promote mediation. In the preamble of the Convention, the increase in the usage of mediation as a form of dispute resolution, as well as the benefits of mediation, are acknowledged. If successful, the Singapore Convention is set to provide a framework for settlement agreements resulting from mediation, akin to what the New York Convention[4] provides for with respect to arbitral awards[5].

Key Provisions

The Convention is comprised of 16 articles. It sets out its scope of application, and provides for certain definitions and general principles. These are followed by the requirements for reliance on settlement agreements, grounds for refusing to grant relief, parallel applications, or claims that may affect relief, other laws or treaties, as well as reservations.

Application

According to Article 1 of the Convention, it applies to agreements resulting from mediation and that are concluded in writing by parties to resolve a commercial dispute. In the following Article, the Convention clarifies the writing requirement.

"A settlement agreement is "in writing" if its content is recorded in any form. The requirement that a settlement agreement be in writing is met by an electronic communication if the information contained therein is accessible so as to be useable for subsequent reference."[6]

The Convention excludes settlement agreements concluded to resolve a dispute arising from transactions engaged in by one of the parties (a consumer) for personal, family or household purposes, as well as those relating to family, inheritance, or employment, from its scope. The Convention, and any reservations thereto, apply prospectively, to settlement agreements which have been concluded after the entry into force of the Convention for the relevant party[7].

Grounds for Refusing of Grant Relief

Article 5 of the Convention sets out the grounds for refusing to grant relief which are related to (i) the parties, (ii) the settlement agreement, and (iii) the mediation procedure. These grounds are very similar to those set out in the New York Convention. The Convention provides that the competent authority may refuse to grant relief at the request of the party against whom the relief is sought, only if that party furnishes to the competent authority proof that:

  • A party to the settlement agreement was under some incapacity;
  • The settlement agreement is null and void, inoperative or incapable of being performed;
  • The settlement agreement is not binding, or is not final;
  • The settlement agreement has been subsequently modified;
  • The obligations in the settlement agreement have been performed or are not clear or comprehensible;
  • Granting relief would be contrary to the terms of the settlement agreement;
  • There was a serious breach by the mediator of standards applicable to the mediator or the mediation; or
  • There was a failure by the mediator to disclose to the parties circumstances that raise justifiable doubts as to the mediator's impartiality or independence and such failure to disclose had a material impact or undue influence on a party without which failure that party would not have entered into the settlement agreement.

This Article provides for two additional grounds that the relevant authority may invoke on its own initiative:

  1. Granting relief would be contrary to the public policy of that party; or
  2. The subject matter of the dispute is not capable of settlement by mediation under the laws of that party.

Conclusion

Prior to this work, there was no legal framework that dealt with the enforcement of settlement agreements and, thus, the Singapore Convention will fill a gap in this regard. Additionally, in 2018 the UNCITRAL amended the pre-existing UN Model Law on International Commercial Conciliation (2002) ("Model Law"). With the amendments, a new section on international settlement agreements and their enforcement has been added[8] and the Model Law has been renamed. The Model Law and the Singapore Convention are designed to complement each other. The Singapore Convention is welcomed by parties that are inclined to use mediation as a dispute resolution mechanism.

[1] For the full text of the Convention please see: https://www.uncitral.org/pdf/english/commissionsessions/51st-session/Annex_I.pdf .

[2] https://uncitral.un.org/en/07.08.2019.

[3] Article 14 of the Convention reads as: "This Convention shall enter into force six months after deposit of the third instrument of ratification, acceptance, approval or accession".

[4] New York Convention on the Recognition of and Enforcement of Foreign Arbitral Awards 1958.

[5] Timothy Schnabel, The Singapore Convention on Mediation: A Framework for the Cross-Border Recognition and Enforcement of Mediated Settlements, https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3239527 .

[6] Article 2(2) of the Convention.

[7] Article 9 of the Convention.

[8] https://uncitral.un.org/en/texts/mediation/modellaw/commercial_conciliation .

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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