Barriers To Enforcement Of Mediated Settlement Agreements In Cross-Border Commercial Disputes: A Comparative Study
- IJLLR Journal
- May 19
- 2 min read
Nikhil Choudhary, LL.M., School of Law Justice and Governance, Gautam Buddha University, Greater Noida, U.P
1. Introduction
Due to globalization, the growth of international commerce, and the interconnectedness of financial systems, cross-border business conflicts have grown more frequent. Today's businesses sometimes operate in many countries, resulting in intricate contractual arrangements. Due to its flexibility, anonymity, and affordability as compared to litigation or arbitration, parties often choose Alternative Dispute Resolution (ADR) processes, especially mediation.
In most cases, mediated settlement agreements are regarded as legally enforceable contracts. Their enforcement across countries has always been questionable, in contrast to arbitral rulings. When parties to cross-border business disputes are situated in different nations with disparate legal systems and enforcement standards, this poses a serious problem. The efficacy of mediation is often compromised by the lack of a consistent enforcement mechanism.An important step forward in resolving enforcement concerns was the adoption of the Singapore Convention on Mediation in 2019. It offers a consistent structure for international mediated settlement agreements to be recognized and enforced. Not all nations are signatories, however, and obstacles are still caused by disparities in national legal systems. Although India's domestic mediation enforcement tools have been reinforced by the Mediation Act, 2023, cross-border enforcement is still dependent on international treaties and foreign authorities. For business partners involved in foreign commerce with Indian firms, this causes uncertainty.
Different techniques to enforcing mediated agreements have been implemented by comparative legal systems including the United States, the United Kingdom, and the European Union. Some include mediation with court-backed procedures, while others depend on contractual enforcement. These variations demonstrate the dispersed worldwide strategy for enforcing mediation. Classifying mediated settlement agreements as contracts, consent decrees, or quasi- judicial rulings is one of the main issues. Enforceability in foreign jurisdictions is directly impacted by this categorization.
