10.07.2018
10.07.2018
Consensual international commercial settlement agreements could soon emerge from the shadows of arbitrational settlements, as the Working Group II of the UNCITRAL (United Nations Commission on International Trade Law) is planning on enabling international enforcement of dispute settlement agreements. Arbitral awards have been internationally enforceable since the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards of 1958 (New York Convention).
As more than 150 states have now joined the New York Convention, arbitral awards are now recognised and enforceable throughout most of the world.
Early February this year, the UNCITRAL Working Group agreed to initiate a convention on the enforcement of dispute settlements resulting from mediation and conciliation in international trade matters. Furthermore, it is seeking to draft model provisions.
Background: 68th Session of the Working Group II (Dispute Settlement) of the UNCITRAL
The 68th session of the Working Group II took place with 60 participating member states, many observing states and representatives of the EU and NGOs. They agreed on a draft of a convention and draft provisions to regulate the enforcement of international commercial settlement agreements resulting from mediation.
As to the content, the draft of the New York Convention on Mediation is mostly analogous to the Convention on Arbitral Awards. Similar to the Convention on Arbitral Awards, with its (currently) 15 Articles the new convention is also compact and the regulation technique is very similar, too. The model provisions are supposed to amend the existent “Model Law on International Conciliation” that has been in place since 2002. Especially the new terminology, which replaces the term “conciliation” with “mediation” throughout the draft instruments, is to be implemented. At the moment, the national members of the Working Group are commenting the drafts. At the end of June, the UNCITRAL is expected to discuss the drafts during its 51st session (and its 60th birthday) in New York. It is possible that the UN General Assembly could pass the New York Convention on Mediation and the Model Code by the end of this year.
Mediation as a Mechanism for International Dispute Settlements
Following the exemplary developments in arbitral proceedings leading to a solid international mechanism for the enforcement of international dispute settlements due to the passing of the New York Convention on Arbitral Awards, a similar effect could emerge from the uniform regulation of enforcement of settlement agreements resulting from mediation. This way, mediation could evolve to become a real alternative in settlements in international B2B procedures. Until now, the parties to an international mediation settlement could not rely on an effective mechanism to enforce their settlements.
The German Perspective
The Federal Bar Association (“Bundesrechtsanwaltskammer”) has given its view on the plans. It generally welcomes the development of instruments to enforce international commercial settlement agreements resulting from mediation. However, criticism may be raised with respect to the details of the drafts: To start with, the draft lacks a uniform understanding of mediation and conciliation. Doubts on the effectiveness of the enforcement of settlement agreements could also result from the fact that mediators in consensual proceedings are often not qualified in law and therefore may have difficulties in phrasing enforceable agreements. Furthermore, it would have to be ensured that fundamental procedural principles (such as independence and impartiality of the mediator) have been observed during the conclusion of the settlement agreement. It is also unclear, whether and how the non-observance of the applicable cogent law would be reviewed when it comes to the enforcement of a settlement agreement. The Federal Ministry of Justice and Consumer Protection has not (yet) taken a stance on the UNCITRAL drafts.
 | Dr. Stephan Bausch, D.U. |
 | Dr. Simon J. Heetkamp |
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