Robert.Jervis_43227 Aug 29

Shipping lawyers call on UK to adopt new UN convention

Shipping lawyers call on UK to adopt new UN convention image

Singapore Convention will lend more legitimacy

Shipping law firm Myton Law is calling on the UK to sign up to a new United Nations Convention relating to the settlement of international commercial disputes through mediation.

On 7 August, 46 countries, including the US and China, signed up to the new ‘Singapore Convention’, but the UK and the European Union are notable absentees, says specialist shipping and logistics lawyer John Habergham of Humber-based Myton Law.  The Convention could come into force in Spring 2020.

UK importers, exporters and all involved in international trade and the carriage of goods, stand to benefit from the Singapore Convention, which aims to provide for the enforcement of mediated settlements of disputes involving agreements across country boarders.

“Given the nature of mediation in practice non-compliance rates are low, as parties are unlikely not to follow through with an agreement they have put time and effort into,” said Habergham. 

“Where this new convention could really make a difference is indicated by a survey conducted by the International Mediation Institute in 2014 showing that 93 per cent of respondents were more likely to engage in mediation with parties from another country if there were a way of enforcing mediation settlement rights.  So, the Singapore Convention will lend more legitimacy to the process of mediation.

“There is no reason why we shouldn’t and every reason why we should.  I can only assume that currently the Government’s attention is diverted elsewhere.”

Currently, if settlement of a mediation requires enforcement, this can involve court proceedings in one country which must then be enforced in another jurisdiction, if possible; or arbitration, followed by an arbitral award which then must be enforced in the country where the assets are located. All this is costly and time-consuming, and may discourage parties from engaging in a mediation process at the outset.

The Convention has been designed as a catch-all, covering all mediation-type resolutions regardless of whether it is titled specifically 'mediation' or not. Similarly, the mediation does not have to be carried out by an accredited mediator to count. As long as the proceedings fall within the Convention's broad definition of a mediation, the parties may apply for relief. Proof that the proceedings were a mediation may be given through signatures from both parties, or from the mediator.

One particular feature of the Singapore Convention is that signatory countries are able to specify that the Convention will only apply if both parties have agreed to it. This provides the option of opting out of the Convention.

The courts of signatory countries are expected to handle enforcement of settlement agreements.

Myton Law provides specialist shipping, rail and logistics legal services from its Hull offices overlooking the Humber.  The firm’s expertise also includes insurance, commercial property, renewables and international trade.