30 July 2015
The Singapore International Mediation Centre is pushing for businesses to turn to mediation instead of more costly arbitration.
Travelling to Singapore for arbitration to resolve business disputes is a common practice for local companies and their foreign partners, keen on the more even-handed environment and experienced arbitrators to be found on the island.
Lok [Vi] Ming, director of the Singapore International Mediation Centre, said mediation is still a relatively new concept for Myanmar, but could be helpful in more quickly ending disputes.
“It is very important to keep business relationships together even when problems emerge,” he said. “The Singapore International Mediation Centre hopes to provide that platform for parties which are in business together, to remain in a relationship even when a problem emerges.”
The centre was founded in November 2014. Officials recently visited Yangon to promote the centre’s services.
In arbitration, the two sides in a business dispute present evidence, with the arbitrator deciding the winner in the same way a judge would in a normal court of law. The process is more flexible and usually quicker than the courts.
Turning to mediation is touted as a way to make the process even simpler. It is where an independent mediator assists two arguing parties with negotiations to solve a dispute.
Lok [Vi] Ming said that mediation can save time and money while preserving these relationships, as the focus is more on negotiation assisted by a neutral party rather than selecting a winner.
Alternative forms of dispute resolution have been growing in popularity. It is particularly important for parties from different countries to have a good idea of how and where to solve a problem.
“If a Myanmar company has a dispute with a South Korean company, you need to find dispute resolution in a third country,” he said. Mr Lok added that it can be a tricky process.
Many companies currently choose to seek arbitration in Singapore or increasingly Hong Kong due to rickety local practices, though efforts are under way to improve.
Arbitration in Myanmar is currently grounded in a 1944 Arbitration Act, according to U Myint Lwin, a lawyer. Enforcement is currently difficult in Myanmar, and there is no dedicated arbitration centre.
Yet steps are being taken to improve the situation. An updated bill was submitted to parliament earlier this year. Myanmar also signed the New York Arbitration Convention in 2014, joining an agreement to recognise and enforce arbitral awards locally. Prior to joining the convention, there was no guarantee foreign decisions would be implemented locally.
U Maung Maung, deputy director and legal adviser at the Ministry of Commerce’s Trade Promotion Department said there are other efforts under way to improve local practices through seeking expert advice.