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On 7 August 2019, Singapore made international legal history when the United Nations (UN) Convention on International Settlement Agreements Resulting from Mediation – otherwise known as the Singapore Convention on Mediation – opened for signatures. Singapore, the United States and China are among the forty-six countries that are signatories to this Convention. This event also drew attention to mediation, which is a common method of alternative dispute resolution (‘ADR’). What is the difference between mediation and other forms of ADR, such as arbitration? Here are some key facts to note about mediation.
What is mediation?
Mediation involves a neutral third party – known as the ‘mediator’ – who helps disputing parties reach an amicable agreement to their dispute. The mediator plays a facilitative role as he or she will not make a binding decision on the dispute for the parties. Instead, the mediator will allow the disputing parties to share their concerns and discuss the matter openly. Through this process, the aim is for the parties to voluntarily find a solution to their dispute that they can mutually agree to and be bound by.
Is mediation the same as arbitration?
While mediation and arbitration are common methods of ADR and both involve a neutral third party that seeks to resolve the dispute in a confidential manner, mediation differs from arbitration in several ways.
Arbitration is similar to a court case in that a neutral third party makes a decision on the parties’ dispute. Both of the disputing parties agree to be bound by the arbitrator’s decision. The arbitrator’s decision is based on his or her assessment of the legal rights and wrongs of the dispute. In contrast, the mediator acts as a facilitator throughout the process, helping the parties share their concerns and discuss the matter to reach a mutually agreeable outcome.
In mediation, there is no ‘winner’ or ‘loser’, unlike in arbitration. Mediation seeks to achieve a ‘win-win’ outcome for the disputing parties. If both parties to a mediation reach an agreement on the dispute, they will usually enter into and sign a written settlement agreement which will be binding on them.
The infographic below outlines the key features of mediation as a form of ADR.