Wednesday, August 5, 2020

UK should sign up to UN’s new commercial dispute resolution convention

Shipping law firm Myton Law is calling on the UK to sign up to a new United Nations Convention for settling international commercial disputes through mediation.

Earlier this month 46 countries, including the US and China, signed up to the new Singapore Convention, but the UK and the European Union are notable absentees, says specialist shipping and logistics lawyer John Habergham of Myton Law.  The Convention could come into force in next spring.

UK importers, exporters and all involved in international trade and the carriage of goods, stand to benefit from the Singapore Convention, which aims to provide for the enforcement of mediated settlements of disputes involving agreements across country boarders.

“Given the nature of mediation, in practice non-compliance rates are low, as parties are unlikely not to follow through with an agreement they have put time and effort into,” said Mr Habergham.

“Where this new convention could really make a difference is indicated by a survey conducted by the International Mediation Institute in 2014 showing that 93 per cent of respondents were more likely to engage in mediation with parties from another country if there were a way of enforcing mediation settlement rights.  So, the Singapore Convention will lend more legitimacy to the process of mediation,” he said.

He believes the UK will sign up to the convention: “There is no reason why we shouldn’t and every reason why we should.  I can only assume that currently the Government’s attention is diverted elsewhere.”

Currently, if settlement of a mediation requires enforcement, this can involve court proceedings in one country which must then be enforced in another jurisdiction, if possible; or arbitration, followed by an arbitral award which then must be enforced in the country where the assets are located. All this is costly and time-consuming, and may discourage parties from engaging in a mediation process at the outset.

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