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SINGAPORE – An international convention that aims to help businesses resolve cross-border disputes and further facilitate international trade went into effect on Saturday (September 12).
Called the Singapore Convention on Mediation, the United Nations treaty is the first to bear the country’s name, the Law Ministry said in a statement.
The convention seeks to give companies around the world more certainty in resolving cross-border disputes through mediation by allowing them to go directly to the courts of countries that have ratified the treaty.
Home Affairs and Law Minister K. Shanmugam, who represented Singapore as the first country to sign the treaty, said: “The entry into force of the convention is an important milestone as it further strengthens the implementation framework of the resolution of international disputes.
“This benefits businesses by providing greater certainty in resolving cross-border trade disputes and ultimately facilitating international trade and commerce.”
As of September 1, 53 countries have signed the convention, also known as the United Nations Convention on International Settlement Agreements Resulting from Mediation, including the United States, China, and India. The list also includes Afghanistan and the island nation Palau.
Ecuador, Fiji, Singapore, Qatar, Saudi Arabia and Belarus have ratified the convention.
Through mediation, parties to a cross-border dispute can attempt to negotiate a new agreement, facilitated by a neutral outside mediator, to salvage a business relationship that would otherwise disintegrate if the routes of litigation or arbitration were taken.
At present, a conciliation agreement concluded in one country does not have legal force in another. A party seeking to enforce a mediated resolution agreement in another country or in several countries will have to initiate legal proceedings in each country.
This can be expensive and time consuming, especially for international settlement agreements.
The treaty also strengthens Singapore’s position as an international dispute resolution center and better responds to the needs of international companies using Singapore as a base for international business transactions, the ministry said.
Secretary of the United Nations Commission on International Trade Law, Anna Joubin-Bret, said: “We hope that (the convention) will bring certainty and stability to the international framework on mediation and contribute to the goals of sustainable development, including the objective of promoting inclusive societies for sustainable development “.
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