Singapore Convention Entered into Force on 11.04.2022

Singapore Convention

‘Singapore Convention’ also known as ‘United Nations Convention on International Settlement Agreements resulting from Mediation’; which provides for a framework for the enforcement and invocation of settlement agreements resulting from mediation resolving the international commercial disputes, was adopted by the United Nations General Assembly on 20 December 2018, and was signed by 46 countries, including Turkey, on 7 August 2019, when it was opened for signature. Signed by more than 50 countries at the beginning of 2021, the Singapore Agreement entered into force on 12 September 2020, 6 months after the ratification process of Qatar, the third country to ratify the Convention under Article 14.

Ratification and Entering into Force in Turkey

The Singapore Convention was adopted in Turkey on 25 February 2021 with the legislative proposal numbered 7282 stating that the ratification of the convention was appropriate and entered into force as of 11 April 2022.

Significance

Singapore convention, which is one of the alternative dispute methods, prioritizes the requests and suggestions of the parties, and saves cost, time and effort because it is less expensive and practical than arbitration and state proceedings. Thus, this convention also enables international mediation to become widespread and contributes to the mediation institution's position as an alternative to arbitration and the court. The reason why international mediation, which aims to reach a faster and cheaper resolution than state courts in the resolution of disputes, is not as frequent as arbitration, which is another alternative dispute resolution method, is due to the problems related to the enforceability of international mediation decisions before the Singapore Convention. According to the 1958 New York Convention on the enforcement of international arbitration awards; while the arbitral awards given a result of the arbitration proceedings could be easily enforced internationally, the same convenience was not provided for the settlement agreements. The Singapore Convention, which aims to remove this obstacle to the international mediation method and to popularize the application of this method, unlike the 1958 New York Convention: by having consequences for the implementation of the Mediation Agreement Document without the need for its recognition in the relevant country; the spread of mediation which is a faster and cheaper way, by reducing applications to court and arbitration; It contributes to the mediation institution's becoming an alternative position against arbitration and court. The Singapore Convention, which aims to establish uniform international mediation rules and ensures the protection of confidentiality in the mediation process, is also; by creating harmony in commercial relations, creating positive effects in terms of the 'United Nations Sustainable Development Goals' and enable for the enforceability of mediation settlement agreements signed in commercial disputes in the participating countries; It also has a facilitating and encouraging effect on international trade in terms of the development of international trade and economic relations, and the safe realization of investments by investors in different countries.

Sphere of Application and Execution

The Member states that are party to the Singapore Convention; will be able to make reservations in accordance with the convention and determine their own enforceability rules. Thus, international mediation agreements that do not contradict the domestic law and public order of the parties will be able to be executed by the relevant country. According to the Singapore Convention, in order to the settlement agreements to be enforced, the settlement agreement; must be made as a result of mediation activity, must have an international characteristic (have an element of foreignness), must have a commercial nature and must be eligible for mediation. Therefore, the settlement agreement to be enforced such as an arbitral award and settlement agreements to be enforced such as a court decision, are excluded from the scope of the convention, even if they relate to international trade. Moreover, disputes related to the state and state institutions, inheritance, family or labor law and disputes arising from transactions made by one of the parties (consumer) for personal purposes are also excluded from the scope of this contract. Pursuant to the Singapore Mediation Convention state courts that are parties to the Convention will not be able to audit (content control) by entering into the settlement agreements brought before them for the purpose of execution. But pursuant to Article 5 of the Singapore Convention; If one of the parties to the settlement agreement is incapable of making this agreement, the settlement agreement is invalid, impossible to implement, void, the settlement agreement is not binding or final or subsequently loses its binding or finality, the debt specified in the settlement agreement is fulfilled, if the settlement agreement is not clear and intelligible If the enforcement request is contrary to the provisions of the settlement agreement, if there are reasons that seriously violate the standards applied to mediation, such as the mediator's abuse of office, and it can be understood that the relevant party will not conclude the settlement agreement without such violation, the enforcement of the settlement agreement is contrary to the public order of the State party, and if the subject of the dispute is not suitable for mediation, the request for the execution of the settlement agreement may be rejected. The existence of these reasons; It will not necessitate the refusal of the execution of the settlement agreement but will only enable the refusal of the request. The refusal of the execution of the settlement agreement can be observed ‘ex officio’ by the court in case of violation of public order or inability to be resolved by mediation in accordance with the domestic law of the contracting state.

Enforceability of Settlement Agreements in Turkey

According to Turkish law (HUAK) numbered 6325, Article 18/4 of the Law on Mediation in Civil Disputes: Agreement document signed jointly by the parties, their lawyers and the mediator will be considered as a writ document without an annotation of enforceability. According to the second paragraph of Article 18; Giving an enforceable annotation to the settlement agreement by the court does not make the settlement agreement a writ. Annotation, which will ensure that the settlement agreement is accepted only as a writ document; while the settlement agreement concluded as a result of mediation activity in accordance with HUAK before the Singapore Convention cannot be enforced as a foreign court decision in foreign countries, after the Singapore agreement, the enforceability barriers in front of the settlement agreement will disappear in that way the mediation agreement document can be applied without the need for recognition in the relevant country.

Conclusion and Evaluation

Mediation and settlement agreements made in the international commercial area with the Singapore Convention can be enforced without being recognized in the relevant country; It will save cost, time and effort, lay the groundwork for the development of international trade, the creation of a safe investment environment and the promotion of international investment, and will bring international mediation to an alternative position against arbitration and court.

Trainee Lawyer Esma Gizem Gökçe