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19.08.2021

UNITED NATIONS CONVENTION ON INTERNATIONAL SETTLEMENT AGREEMENTS RESULTING FROM MEDIATION: SINGAPORE CONVENTION

  1. Introduction
The Singapore Convention was arranged after aiming to resolve commercial disputes emerging in the international arena quickly, economically and efficiently, taking into account the bond between the parties. “The United Nations Convention on International Settlement Agreements Resulting from Mediation”, known as the Singapore Convention, was accepted by the United Nations General Assembly on 20 December 2018. The Singapore Convention was opened for signature on 7 August 2019; The entry into force of the Convention was ensured by Article 14 of the Convention. Article 14 of the Singapore Convention procures that the Convention shall enter into force six months after submitting of the third letter of homologation, acceptance, approval or adherence. In the Official Gazette published on March 11, 2021 (1), it was mentioned that the "United Nations Convention on International Settlement Agreements Resulting from Mediation" signed in Singapore on August 7, 2019 was appropriate to be homologated, and that Turkey is a party to the Singapore Convention and that the verdicts of the Convention are declared to have entered into force. 
 
  1. Purpose and Subject
The prior nature of the Singapore Convention is to foreground the mediation institution in the resolution of international commercial disputes, which has become disseminating today and is faster and more economic than other judicial remedies in the resolution of disputes. The dissemination of the mediation system, which is fast, easy and economical in the resolution of commercial disputes, depends on ensuring the performability of the peace agreements, which are concluded in line with the discussions to be done.
 
  1. Scope of Adhibition
An arrangement was made in the 1st article regarding the scope of adhibition of ​​the convention. The Convention in question is applied to the written settlement agreements regarding the terms agreed between the parties of the dispute resulting from the mediation meetings for the resolution of a commercial dispute. But, this peace agreement alone is not adequate, and the agreement must meet the conditions given in the continuation of Article 1. The Singapore Convention has limited its scope of adhibition to international peace agreements. The settlement agreement in question is obligated to be related to the resolution of commercial disputes. These are the two main conditions for the execution of the Convention; The agreement between the parties is of an international form and is related to a commercial dispute. In order for the agreement in question to be considered as international under the Convention, the following conditions must exist; 
“(a) The offices of at least two parties to the settlement agreement are in different states; or
 (b) State in which the parties to the settlement agreement have their offices are different than,
 (i) The state in which a substantial part of the debt arising from the settlement agreement will be fulfilled; or 
(ii) The state with which the subject of the settlement agreement is most cordially related”
And, in accordance with Article 1 of the Convention, the international form must be present right during the establishment of the peace agreement.
 
⮚     Agreements not covered by the Convention’s scope of adhibition: 
It is stated that the verdicts of the respective Convention shall not be applied in the peace agreements specified pursuant to the Articles 1/2 and 3 of the Convention. Taking the second paragraph of the 1st article of the Convention into consideration, it is indirectly ensured that the Convention will only be applied within the scope of commercial disputes, as touched on above. The Convention explicitly excludes settlement agreements that settle disputes emerging from operations made by one of the parties (consumer) for personal or family purposes. Alongside personal disputes, the Convention also excluded settlement agreements regarding inheritance and labor law.
 
In accordance with paragraph 3 of the article in question, as well as personal disputes, settlement agreements that have become a court decision and peace agreements that can be held as a court decision are also excluded from the scope of the Convention. A settlement agreement falls outside the scope of the Singapore Convention if there is an executory court decision in the state party.
 
  1. Performability
Some procedural conditions are listed in Article 4 for the Singapore Convention to be executed. There is a limitation of cases stated in Article 4 of the Convention, and the peace agreements between the states parties must ensure these conditions, and it is out of question for the parties to request cases that would go beyond the conditions. 
 
⮚      Circumstances in Which the Execution of the Settlement Agreement May Be Rejected
In Article 5 of the Singapore Convention, the circumstances in which the execution of the settlement agreement can be refused are given. As understood from the wording of the article, the authority may refuse the execution of the agreement in the presence of one of these reasons, or may also decide on execution. With these conditions, as understood from the wording of the provision, the authority is not binding by refusing the execution of the agreement; but may also decide to accept the execution at its sole discretion.
1)     Incapacity of the parties,
2)     Invalidity, inefficacy, lack of implementation capacity, being non-binding or interlocutory, or modification of the agreement occurred as a result of the mediation process,
3)     The obligations that took place in the agreement being fulfilled, but not clear or perceptible,
4)     Decision of performability being adverse to the verdicts of the agreement,
5)     The mediator's improper action to the standards ensured for the mediator or the mediation process,
6)     Failure of the mediator to notify the parties of situations that damage its impartiality and independence,
7)     Decision of performability being adverse to the public order,
8)     The matter of the dispute not being suitable for resolution through mediation.
 
  1. Conclusion
The basic function and purpose of the United Nations Convention on international settlement agreements resulting from mediation is the resolution of disputes that emerge with the widespreading international commercial activities in a quick and economic manner, which is also important for all countries. The main reason for the approval of the aforementioned Convention is to ensure execution capability to peace agreements that resolve international commercial disputes through mediation. Put in differently, we can say that, in accordance with the verdicts of the Singapore Convention, mediation will turn international commercial disputes to become widespread, and accordingly, legally more secure international commercial relations will be formed between countries.