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UN Convention on International Settlement Agreements

Topic covered:

Bilateral, regional and global groupings and agreements involving India and/or affecting India’s interests.

 

UN Convention on International Settlement Agreements

 

What to study?

For prelims and mains: Key features and significance of the convention.

 

Context: India has signed the United Nations Convention on International Settlement Agreements (UNISA).

 

About UNISA:

The United Nations General Assembly adopted the United Nations Convention on International Settlement Agreements Resulting from Mediation (“the Convention”) on 20th December 2018.

The convention is also known as the “Singapore Convention on Mediation” (the Convention).

 

Key features:

  1. The Convention provides a uniform and efficient framework for the enforcement of international settlement agreements resulting from mediation and for allowing parties to invoke such agreements, akin to the framework that the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York, 1958) (the “New York Convention”) provides for arbitral awards.
  2. The Convention defines two additional grounds upon which a court may, on its own motion, refuse to grant relief. Those grounds relate to the fact that a dispute would not be capable of settlement by mediation or would be contrary to public policy.

 

Benefit:

Signing of the Convention will boost the confidence of the investors and shall provide a positive signal to foreign investors about India’s commitment to adhere to international practice on Alternative Dispute Resolution (ADR).

 

Initiatives by India to promote ADR Mechanisms:

  1. In order to encourage international commercial arbitration in India, to evolve a comprehensive ecosystem of arbitration the Government is establishing the New Delhi International Arbitration Centre (NDIAC)as a statutory body.
  2. The Commercial Courts Act, 2015, has been further amended and legislative exercise to further amend the Arbitration and Conciliation Act, 1996, is currently underway.
  3. A new Chapter (IIIA) has been inserted in the Commercial Courts Act, 2015, for mandatory pre-institution mediation and settlement in certain category of cases.

 

Significance of ADR:

It is felt that a reliable and responsive alternative dispute resolution system is essential for rapidly developing countries like India. While business disputes need speedy resolution, litigation is the least favoured method for that. The Indian judicial system is marred by delays because of which businesses suffer as disputes are not resolved in a reasonable time period. Therefore, need for alternative dispute resolution processes like negotiation, mediation conciliation and arbitration is felt from time to time.

 

Sources: the Hindu.