Serbia signs the Singapore Mediation Convention – An Attempt to Boost Mediation from the Outside

September 11, 2019

Serbia signs the Singapore Mediation Convention – An Attempt to Boost Mediation from the Outside

September 11, 2019

Miloš Velimirović

Miloš Velimirović

Partner

Ivan Nikolić

Ivan Nikolić

Senior Associate

This year, during the first week of August, a Mediation week took place in Singapore. It gathered the most prominent personas in the area of alternative dispute resolution, including over 1,500 delegates, UN representatives and high state officials. The main event, signing of the Singapore mediation convention (Convention), occurred on 7 August. 46 states signed the Convention, including the USA, China, Japan, India, Turkey, Australia, Switzerland, and many others.

Serbia, as one of the signatories, made a step in enhancing the position of mediation and familiarizing the public with this alternative method of dispute resolution (ADR). Implementation of the Convention is expected to allow foreign investors and companies operating in Serbia, to maneuver conflicts in an efficient way, without the incertitude that such a solution may not be executed. So far, this ADR method was introduced in Serbia in 2005, but the latest legislative act was rendered in 2014. However, it was rarely practiced throughout this period, although, the legislative framework existed.

Main Features of the Convention

The Convention in its article 2(3) gave the term mediation, a broad and thorough definition, as an attempt of reaching an amicable settlement between the parties, with the assistance of a third person or persons (‘the mediator’) lacking the authority to impose a solution upon the parties. The Convention applies to every settlement which falls under the scope of this definition even if the process itself is not called a mediation. An appealing feature of mediation as provided in the Convention, besides its effectiveness regarding the costs, time and other resources, is the lack of requirement for it to be administered under the frame of a mediation institution or by an accredited mediator. The provision as such is intentionally extensive and aims to elevate the attractiveness of mediation and its flexibility in dispute resolution.

Furthermore, the content of the Convention governs questions regarding the scope of application, exclusions, reservations and accompanying formalities. Subject to the Convention are commercial international disputes, excluding the settlement agreements arising from transactions for family, household or personal purposes, relating to family, inheritance or employment law, and settlements enforceable as a judgment or an arbitral award. A request for relief based on a settlement agreement is limited to those which are signed by the parties and accompanied by evidence proving that they resulted from mediation. Additionally, reservations can be made by the signatory states in regards to the application of the Convention to the extent that the parties chose. In regards to the form of the settlement, it will be considered valid regardless of the conclusion being made electronically or in writing, under the condition that the info contained therein is accessible so as to be usable for subsequent reference.

Finally, the Singapore Convention as an international instrument facilitates commercial cooperation with mediation and aids in execution and recognition of such solutions on the territories of signatory states. Following the path of its successful counterpart, the New York Convention on enforcement and recognition of arbitration awards, with a short text but significant provisions, the Singapore Convention is paving a way for alternative dispute resolution and its recognition on the international basis.

The Convention will come into force six months after the deposit of the third instrument of ratification, acceptance, approval or accession. However, the Convention shall enter into force with respect to particular state six months after the date of the deposit of the instrument of ratification/acceptance/approval/accession of that state.

Is Legislative Framework Sufficient

Serbian Government already appointed a committee that is tasked with the harmonization of current legislative acts with the Convention, but also with UNCITRAL Model Law on Mediation. However, the current Serbian Mediation Act contains reference to the rules of the United Nations and Council of Europe regarding mediation, and these rules and principles therefrom apply accordingly. Therefore, it seems that Serbian law is quite harmonized with the Convention.

However, there are some aspects where Serbian law is not harmonized with the Convention, such as the fact that Convention does not apply to the agreements which could be enforced as a court decision (court-settlement agreements) or an arbitral decisions, or that have been approved by the court or rendered in the course of the court proceedings. In this respect, Serbian law, for example, provides that a settlement agreement resulting from the mediation process could be the enforceable title (as arbitral or court decision) in case the signatures of the parties and mediator on the settlement agreement are duly notarized.

Game Changer, or Just a Moot Point?

There is no doubt that signing the Convention is remarkable worldwide. However, the real question is whether this point will wake up this dormant ADR area in Serbia, or any other country where mediation did not root itself into the soil. Serbia introduced mediation in 2005, but its application in the practice has been marginal. Serbian statues impose the obligation to the courts to warn and teach the parties to the proceedings that there is an ADR that could be used for dispute resolution – mediation. However, to this day, mediation was, more or less a dead letter.

However, the Convention sets up uniform rules for international mediation. There is a possibility that in case practiced by the foreign entities in business interaction with entities from Serbia, international mediation could give a boost to domestic mediation as well.

This text is for informational purposes only and should not be considered legal advice. Should you require any additional information, feel free to contact us.

Contact:

Miloš Velimirović , Partner
milos.velimirovic@sog.rs
+381 63 555 156

Ivan Nikolić, Senior Associate
ivan.nikolic@sog.rs
+381 69 3282 806

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