Mediation gains international prominence
While mediation is professionalising more and more in France1, the agreements reached by the parties at the end of a mediation process could soon benefit from increased international effectiveness, thanks to a new UNCITRAL Convention.
Although mediation favours, by nature, the spontaneous implementation of the resulting agreements as they are drawn up by the parties themselves, many companies have expressed their need to be able to obtain enforcement of mediation agreements abroad.
The UN Commission on International Trade Law has taken up the issue and has published its proposal for a solution: a dedicated international convention - the Singapore Convention - to be opened for signature as of 1st August 2019, and a further instrument to complete its model law on conciliation dating from 2002.
The new Convention stipulates that international mediation agreements, known as “settlement agreements”, may be effective abroad if certain conditions are met:
- the mediation must be international, have resulted in a written agreement, and aim to resolve a commercial dispute;
- the settlement agreement must not take place in any judicial or arbitral proceedings or be enforceable as a judgement or award;
- the agreement must genuinely stem from a mediation process, which must be proven by the party seeking to use it;
- none of the grounds for refusing to give effect to the agreement should be characterised. Among the grounds exhaustively listed in Article 5 are, in particular, the cases in which the settlement agreement “has lapsed, is inoperative or not likely to be executed (...)” or the mediator “failed to fulfil the obligation to declare to the parties circumstances that raise legitimate doubts as to his impartiality or independence (...)”.
These expectations are reminiscent of the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, which the drafters of the new Convention drew upon.
Professor Jean-Michel Jacquet, in his communication of 5th October 2018 to the French Committee on Private International Law, regretted in certain respects the pure and simple application of the provisions of the New York Convention to settlement agreements, noting that it may be inadequate and result in treating these agreements as arbitration clauses, and not as arbitral awards.
Other eminent members of the Committee have also identified some grey areas, including :
- the condition relating to the commercial nature of the dispute: can agreements between companies and non-profit organisations concluded to put an end to a breach of human rights benefit from the new regime?
- The law applicable to the validity of the settlement agreement: references to the rules of conflict of laws are rare in the Convention, how is the law applicable to this question supposed to be identified?
- The concept of “standards applicable to the mediator”, the breach of which could prevent the settlement agreement from being effective in the State in which it is invoked: there are no international standards applicable to mediators, so that it would be appropriate to presumably refer to the contractual obligations stipulated by the mediator and the parties.
However, there is no doubt that the arrival of such an instrument should be welcomed, since it will encourage the use of mediation, the benefits of which are well established (rapidity, preservation of commercial relations, control of costs, etc.). A settlement agreement that is considered effective within the meaning of the Convention may thus give rise to enforcement measures but may also be used as a defence in the event that one of the parties is involved in a dispute already settled by such an agreement.
Questions relating to the practical application of the Convention will only be answered once it will have come into force, that is, after ratification by at least three States. It seems to be only a formality, as it is hoped that the Singapore Convention will meet the same success as the Convention of New York from which it draws inspiration, and to which no less than 159 States are parties.
1 The Court of Cassation has just specified that a diploma is not mandatory to appear on the lists of mediators registered with the courts of appeal (Cass. civ. 2nd 27 Sept. 2018 No. 18-60.091) and that an application for registration may not be rejected for a reason that does not appear in the registration conditions expressly listed by Decree No. 2017-1457 of 9 October 2017 (Cass. civ. 2nd 27 Sept. 2018, no. 18-60.132).