Mukti Rijal

Even though belated, the discourse on Singapore Convention on mediation and its significance has started to gain a momentum in Nepal, too. Recently, Nepal Law Commission has prepared a note on the key aspects of the convention which has lent much needed succor to the on-going discourse on the theme. The Law commission's note has appropriately underlined the importance of the adoption and ratification of the Convention which will, according to the note, set an important milestone towards promotion and development of commercial dispute resolution in Nepal.
The view contained in the Commission's note was further articulated and endorsed by the participants in the webinar organised recently by Nepal International ADR Centre-NIAC where business leaders, mediation practitioners, lawyers, advocates and policy makers echoed and emphasised the importance of the convention to promote commercial sector and business investment in the country. The business leaders who took part in the webinar stressed that the government should take cognizance of the importance of the convention and ratify it soon.

Institutional framework
Nepal can be said to have raced far ahead of many other countries in this part of the region when it comes to creating the much-needed domestic institutional framework for development of mediation as a non-adversarial tool for dispute resolution. It is among the leading countries in South Asia for having enacted an umbrella mediation act in 2011 which has been appreciated by eminent mediation practitioners from India and many other countries in the region.
They have even described the Nepali mediation act as a model which deserves to be followed by other nations in the region. In fact, mediation has not been provisioned by any separate legislation in India yet far. Mediation is mentioned under Section 89 of the India’s Civil Procedure Code. According to the Code, whenever there is an element of settlement in a dispute, judges can give the parties an option to resolve their disputes through arbitration, mediation, conciliation, Lok Adalat or judicial settlement. As it stands today, almost all high Courts in India have developed court annexed mediation programmes. Some of the courts including the Supreme Court refer cases to private mediation.
With respect to court annexed mediation, Nepal has established mediation programmes across all district courts, high courts and the Supreme Court. The courts refer cases to mediation and some of them are settled to reach to gain-gain outcome. Going by its proven credentials in furthering initiatives in providing legal and institutional basis to mediation, Nepal cannot, therefore, afford to delay the process to respond positively to the Singapore Mediation Convention through its ratification.
Indeed, there is nothing to lose or any added burden to bear by ratifying this convention which is, of course, very much different from other international human rights covenants. Though there is a need to study and analyse the potential consequences upon the ratification of the international treaties and convention, in the case Singapore convention we can say with firm convictions that there is much to gain from it rather than to lose. It does not cast any additional obligations to the state to fulfill and responsibilities to account. Its ratification will instead enhance the image and credibility of Nepal in the international business arena.
The fact that mediation has been promoted and enforced as the key institutional avenues in resolving cross border commercial disputes will help raise the country’s ease of doing business index to lure foreign direct investment and increase economic activities. There is no gainsaying the fact that the Singapore Convention has been hailed as a game changer in the alternate dispute resolution space. The convention especially seeks to give global businesses some amount of certainty in resolving cross border disputes by way of mediation. The convention makes it possible to apply directly to the courts of countries that have ratified it.
As of today, a settlement agreement executed in one country has no legal force in other country. A party looking to enforce a mediated settlement agreement in a different country or multiple countries for that matter will have to initiate legal proceedings in each of those countries. This can be very costly and time consuming, especially for settlement agreements that are of cross border nature. Now, after this convention has come into effect, one of the parties to the dispute looking for enforcement of a cross border mediated settlement agreement can do so by applying to the courts of the signatory countries that have also ratified the convention. This can save time and money for all those concerned.

Commercial mediation
A wider range of cases where commercial mediation can be successfully used include business contracts, intellectual property and information technology, tortuous liability, real estate and construction, banking and insurance, insolvency and so on . The effective resolution of the commercial disputes in the areas as mentioned can assure business sector to invest and promote their commercial activities.
Going by the provisions of the convention, it can be said that the treaty lays the firm ground for enforceability of international commercial settlement agreements to facilitate efficient administration of justice. It also contributes to the development of harmonious international economic relations across business sector and even the countries. It is expected that Nepal takes steps to ratify the convention and enroll in the league of the countries that have already endorsed the convention. It will provide an opportunity for business sector to reduce their hassles in settling the disputes that can otherwise cost dearly on their transactions.

(The author is presently associated with Policy Research Institute (PRI) as a senior research fellow.  rijalmukti@gmail.com)