SINGAPORE — Commercial mediation work in Singapore has been given more legislative muscle, as Parliament yesterday passed the Mediation Bill, one of two bills tabled to strengthen the Republic’s position as an international centre for dispute resolution.
The new Mediation Act, aimed at making settlements more enforceable, will allow parties who reach a settlement after mediation to agree to apply to have the settlement recorded as a court order, which can be enforced.
It also stipulates that mediation communication cannot be disclosed to any third party, and cannot be admitted into evidence without permission as well.
The Act is the last of the recommendations made by the International Commercial Mediation Working Group to be implemented. The group was set up in 2013 by the Chief Justice and the Law Ministry.
In Parliament on Tuesday (Jan 10), Senior Minister of State for Law Indranee Rajah said that the lack of enforceability of a mediated settlement agreement is an oft-cited concern of mediation. “This lack of enforceability is seen as an inhibiting factor in attracting commercial parties to mediate a dispute, since finality and certainty of dispute resolution outcomes is key,” she said.
Six Members of Parliament (MPs) took to the floor to speak on the Bill, among them MP (Bukit Batok) Murali Pillai, who asked if the intention behind the Bill was to “promote mediation as a mainstream form of dispute resolution”, instead of being an alternative.
He also asked if the Bill could be “strengthened even further to encourage parties to refer their dispute to mediation before litigation”.
Ms Indranee said that there needs to be an alternative method so that those seeking resolution may find a method most suited for them.
She also said that the Bill provides an “additional, expedited way” for parties to ensure their dispute settlement is enforceable.
To raise the credibility of mediation as a profession, MP (West Coast GRC) Patrick Tay proposed a continual appraisal of accredited mediators. Commenting that mediation needs to “evolve quickly into a true profession”, Mr Tay said: “High minimum practice and ethical standards need to be set, made transparent and achieved internationally. Mediators, too, need to be suitably recognised for their expertise and skills.”
Mr Tay also proposed that there be channels for redress for those seeking to settle disputes via mediation, given the potential rise in this avenue of conflict resolution.
On the same day, Parliament also passed the Civil Law (Amendment) Bill, which sets out a framework for third-party funding in international commercial arbitration — where legal costs can be substantial.
Ms Indranee said that agreements for third-party funding of dispute resolution proceedings here are now “unenforceable”, to protect vulnerable parties and guard against potential abuse of court proceedings.
On the issue of regulation, raised by others in the House such as Mr Tay and Nominated MP Mahdev Mohan, who spoke about “the balance between the need for regulation, while preserving party autonomy and flexibility”, Ms Indranee said: “A heavy regulatory framework will have little practical effect, and our approach should be focused on what is practical and effective, taking into account the nature of international arbitration.”