Resolving cross-border disputes effectively with a peacemaker

Posted in News June 14, 2021

[Mediation in the News]

Lianhe Zaobao (联合早报) yesterday reported on the increasing role of mediation for cross-border commercial disputes.

The impact of Covid-19 has made it hard for parties to comply with their contractual obligations, leading to difficulties in business relationships. However, the non-compliance may not have occurred due to the fault of either party. In such circumstances, it makes sense to mediate any disputes to find a swift and amicable settlement, so that the relationship is preserved for future business.    

The article mentions the SIMC Covid-19 Protocol, whereby mediations can be organized swiftly. The Protocol has seen about 50 case filings so far.

Despite the recognition that mediation is quick, economical and effective, enforceability has been an issue that has affected the take-up rate of mediation.

But with the ratification of the Singapore Convention on Mediation in September last year, international mediated settlement agreements can be enforceable across borders. It will take some time before more countries sign and ratify the Convention, such that settlement agreements become globally enforceable. 

Meanwhile, there are multiple pathways to ensure mediated settlements are enforceable. One way is through the SIAC-SIMC AMA Protocol. Mediated settlements may be recorded as an arbitral award under the New York Convention, enforceable in over 160 countries.

SIMC CEO Chuan Wee Meng said, “The benefits of mediation are even more pronounced during the Covid-19 pandemic.  The Covid-19 pandemic has created widespread disruptions to businesses. During these troubled times when everybody hurts, it makes sense on every level to resolve disputes by talking it out, rather than fighting it out.”

SIMC Chairman George Lim SC said, “In Singapore, mediation is often used in community and family disputes. However, it has also been practised effectively in commercial cases. This includes cross-border disputes that tend to be complex, high-stakes and high-value in nature, such as joint ventures between companies. At SIMC, we now see a growing demand for commercial mediation services. In a way, we are seeing a return to our Asian roots – in our traditional communities, disputes used to be resolved amicably by village elders and headmen.”

Mr Tay Yu Jin, Partner & Head, International Arbitration (Asia), Mayer Brown LLP, shared a case study: A five-jurisdiction high-value energy dispute that was mediated under the auspices of the SIMC after the circuit-breaker period in June 2020. The mediator, the parties, their representatives and lawyers were located in 5 locations – London, Geneva, Dubai, India, Singapore. The case had no relation to Singapore but parties agreed to mediated with SIMC.

Mediation is flexible and may be used alongside arbitration and litigation at any point of the dispute.

Given current travel restrictions during the pandemic period, SIMC has seen an increase in the demand for online mediation. SIMC ensures that technology enables a successful mediation. SIMC works closely with its mediators to ensure that online and hybrid mediations are as successful as the traditional, in-person mediations.

The feedback so far has been positive.

Read the full story here.