UNCITRAL Working Group II (Dispute Settlement) Draft Instrument

In February 2017 the working group presented a draft instrument on enforcement of international commercial settlement agreements. ‘Conciliation’ is defined in the draft to include mediation. It is important because if the draft progressed to a convention, settlement agreements would be given legal effect between the parties and enforced in accordance with the rules of procedure of the State where the settlement agreement is sought to be relied on. The grounds for refusing to give legal effect to a settlement agreement are, properly understood, broad and include a ground where the allegation might be raised that the settlement agreement is null and void, inoperative or incapable of being enforced under the law to which the parties have subjected it. At least 3 of the grounds open up the mediation process and the impartiality of the mediator to scrutiny. The document requires careful consideration. If applicable, confidentiality, often considered important, may be compromised beyond parties’ expectations. Further, one ground puts the mediator firmly in the spotlight. That is, if the mediator fails to maintain a fair treatment of the parties which had a material impact or undue influence on a party without which the agreement would not have been entered into, the settlement agreement may not be enforcedd.

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