News Highlight
The Mediation Bill 2021 was introduced in the Rajya Saba in 2021, and the Parliamentary Standing Committee was tasked with a review of the Bill.
Key Takeaway
- The committee’s report to the Rajya Sabha was submitted in 2022.
- In its report, the Committee recommends substantial changes to the Mediation Bill.
What is Mediation?
- Mediation is a form of alternative dispute resolution (ADR). It is a way of resolving conflicts where two or more parties decide to reach an agreement with the support of a third, neutral party that guides them through the process.
The need to promote mediation legislation
- No standalone legislation:
- While there is no standalone legislation for mediation in India, there are several statutes containing mediation provisions, such as:
- The Code of Civil Procedure, 1908
- The Arbitration and Conciliation Act, 1996
- The Companies Act, 2013
- The Commercial Courts Act, 2015
- The Consumer Protection Act, 2019
- While there is no standalone legislation for mediation in India, there are several statutes containing mediation provisions, such as:
- An alternative for conflict resolution:
- The Mediation and Conciliation Project Committee of the Supreme Court of India describes mediation as a tried and tested alternative for conflict resolution.
- The Singapore Convention on Mediation:
- As India is a signatory to the Singapore Convention on Mediation, it is appropriate to enact a law governing domestic and international mediation.
- Impact on doing business:
- The legislation can potentially positively impact the country’s economy and business environment by avoiding delays in the standard process through the courts.
- Interests of all stakeholders:
- Enacting a comprehensive law and allowing for online mediation may serve the interests of all stakeholders as an effective alternative dispute resolution mechanism.
The key features of the Bill
- The Mediation Council of India:
- The central government will establish the Mediation Council of India.
- The Council will consist of a chairperson, two full-time members (with experience in mediation or ADR), three ex-officio members (including the Law Secretary and the Expenditure Secretary), and a part-time member from an industry body.
- Mandatory Pre-litigation mediation:
- Parties must attempt to settle civil or commercial disputes by mediation before approaching any court or certain tribunals.
- Confidentiality:
- The mediation process will be confidential, and immunity is sometimes provided against its disclosure.
- Legally enforceable:
- The outcome of the mediation process in the form of a Mediation Settlement Agreement (MSA) will be legally enforceable. It can be registered with the State/ district/taluk legal authorities within 90 days to ensure authenticated records of the settlement.
- They may be challenged on the grounds of fraud, corruption, impersonation, or relating to disputes not fit for mediation.
- Disputes not fit for mediation:
- The Bill contains a list of disputes which are not fit for mediation. These include disputes:
- Relating to claims against minors or persons of unsound mind
- Involving criminal prosecution
- Affecting the rights of third parties
- The Bill contains a list of disputes which are not fit for mediation. These include disputes:
- Applicability:
- The Bill will apply to mediations conducted in India:
- Involving only domestic parties
- Involving at least one foreign party and relating to a commercial dispute
- Commercial disputes
- The Bill will apply to mediations conducted in India:
- Mediation process:
- Mediation proceedings will be confidential and must be completed within 180 days (may be extended by 180 days by the parties).
The concerns with the Bill
- The mandatory mediation:
- According to the Bill, pre-Âlitigation mediation is mandatory for both parties before filing any suit or proceeding in a court, whether or not there is a mediation agreement between them.
- Mediators:
- The parties may appoint mediators by agreement or a mediation service provider.
- Non-Commercial Disputes:
- The bill raises the question of the non-applicability of the provisions of the Bill to disputes/matters of non-commercial nature involving the Government and its agencies.
- Autonomy of the Mediation Council of India:
- The Mediation Council requires prior approval from the central government before issuing regulations related to its essential functions.
- International mediations:
- The Bill applies to international mediations only if they are conducted in India.
Way forward
- Voluntary:
- Mediation should just be voluntary and making it otherwise would amount to the denial of justice.
- Ensure proper cross-border mediation:
- To ensure worldwide enforceability, the settlement conducted in India should not be given a status of a judgment or decree of a court.
- Enhance awareness:
- The National and State Legal Services Authorities should disseminate more information regarding mediation and ADRs to become the first option explored by potential litigants.
- Participation of all stakeholders:
- The Bill should be implemented after discussion with stakeholders to enable a faster resolution of disputes. If the issues of the Bill aren’t fixed, our aspirations to become an international mediation hub for easy business transactions could be crushed before they’ve even begun.
Content Source: The Hindu