LEVERAGING MEDIATION IN INTERNATIONAL DISPUTES: A PRACTICAL GUIDE

Cross-border commercial disputes are an inevitable feature of international business. When these disputes arise, parties typically turn to international arbitration – perhaps the contract requires it or the parties feel that arbitration will offer greater predictability than foreign courts.

Yet there is a powerful strategic tool that remains underutilised in international disputes: mediation.

While the benefits of mediation are substantial, perhaps mediation’s primary benefit is that it restores control to the parties themselves. Unlike arbitration, where outcomes rest entirely in the tribunal’s hands, mediation allows parties, with guidance from counsel and a skilled mediator, to design their own solutions.

This shift from tribunal-imposed decisions to party-crafted agreements addresses what many in-house counsel find most unsettling about international arbitration: the near irreversibility of awards and the inherent unpredictability of outcomes, regardless of case strength or panel quality.

From a business and risk management perspective, mediation provides what arbitration cannot. Mediation enables parties to take an active role in shaping the process and its outcomes. For example, in mediation, parties can be creative in developing settlement options, and business relationships can be preserved, if important.

However, a practical concern has historically hindered the use of mediation in international disputes: the enforceability of mediated agreements. While arbitral awards benefit from the enforcement framework of the New York Convention, mediated settlement agreements have traditionally required separate enforcement proceedings, posing a significant practical barrier.

This concern is fading. The Singapore Convention on Mediation, now with 58 signatories and 19 ratified parties, provides a framework for enforcement of cross-border mediated settlements. In addition, institutional rules increasingly include protocols for mediated settlements to be recorded as consent awards, thereby making them enforceable under the New York Convention. The enforceability gap that once justified scepticism about international mediation is closing.

Jan-Mar 2026 issue

Gleason Alvarez ADR