Asserting that mediation is an effective form of dispute resolution, Singapore's Law Minister K Shanmugam has said the new convention on mediation will enhance the country's value proposition to Indian companies as well as lawyers.
The Singapore Convention on Mediation, also the first United Nations treaty to be named after Singapore, came into force in September this year.
Also known as the United Nations Convention on International Settlement Agreements Resulting from Mediation, it provides for a more effective way for enforcing mediated settlements of corporate disputes involving businesses in India and other countries that are signatories to the convention.
In an interview with PTI over a Zoom video call, India-origin Shanmugam emphasised that the convention is extremely important for international commerce as well as for companies.
"We have strong ties of people to people flow, business flow, legal flow. I think it will enhance Singapore's value proposition to Indian lawyers and Indian companies.
"From Indian lawyers' perspective, their business is not taken away. They continue to do business. They do it in Singapore and it will be an attractive venue for them. It increases our relevance to India...," he said.
So far, 53 countries have signed the convention while only a few of them have ratified. India is yet to ratify the convention.
Mediation is an "effective form of dispute resolution" as it allows continuing with the business relationship, the minister said, adding that so far the drawback on mediation was that if there is a mediation agreement, if one side does not perform, there has not been an effective way of enforcing it.
"This convention allows enforcement among the countries that have ratified it... Our intention is to encourage as many countries to ratify the convention," he said.
Mediation is one step before arbitration, the minister said and also acknowledged that litigation and arbitration are expensive.
"Sometime, they are pursued for tactical reasons too. For those who are serious about trying to find a resolution, I think that they would find mediation is very good. Sometimes they don't want a resolution and try to drag it out as long as possible, then of course mediation may not be such a suitable route," he observed.
According to Shanmugam, who is also handling the Home Affairs portfolio, the convention is going to be beneficial for Singapore in a number of ways.
"Singapore is already a business hub. It is a legal hub for Southeast Asia and East Asia. It is a place where lots of Indian companies come and do business, for arbitration... in a purely emotional sense, it is the first convention named after Singapore," he pointed out.
When asked whether corporates could tilt more towards mediation as it is cost effective in these challenging times, Shanmugham said, "I actually see that".
Singapore is already a centre for arbitration and having a mediation convention will be complementary. "You try mediation. If it does not succeed, then you go for arbitration," he noted.
He also said that there are three ways for dispute resolution -- court system, international arbitration and mediation -- and they are not mutually exclusive.
Over the years, Singapore has set up various institutions to provide a full suite of dispute resolution services for international commercial parties to resolve their disputes. These include the Singapore International Arbitration Centre, Singapore International Mediation Centre and Singapore International Commercial Court.
Further, the minister said that India has a deep talent pool when it comes to legal services and that he does not see India developing arbitration and mediation as a long shot. "It is essential and India will get it done. It is already developing," he said.
In terms of international arbitration and mediation, he noted that India is a big player in terms of the commerce part of it.
Before entering full-time politics, Shanmugam had made his mark as a leading lawyer and he opined that there are different types of satisfaction in reply to a query on whether litigation, arbitration or mediation will be his personal preference.
"In terms of impact and in terms of the ability to serve the people, acting as a lawyer does not compare with being a minister in the Government of Singapore... My ministry put through three legislations on Covid-19... the legislations helped tens of thousands of businesses and business people.
"As a lawyer acting for a client, you cannot do that kind of work for the society at large," he concluded.
Shanmugam has done private practice as a lawyer and was also one of the youngest lawyers to be appointed as a Senior Counsel of the Supreme Court of Singapore.