On Legal Effect Problems Of International Commercial Mediation Agreement And Settlement Agreement

The international commercial disputes arise from the commercial activities of the equal bodies in different countries and regions. The international commercial dispute is a type of commercial activity with an international character. The first characteristic is that it's international, which means it's different from the domestic ones. The following one is its commercial nature, which is equality, which makes it different from the international disputes. Thanks to the characteristics of international commercial disputes, its settlement mechanism embodies distinctive features from the domestic commercial disputes. And the most obvious features of the present settlement mechanism of international commercial disputes are diversification and privatization. Diversification means the settlement of international commercial disputes has various ways, such as litigation, arbitration, mediation and many other ADR methods which constitute as a whole of the settlement mechanism of international commercial disputes. Privatization means that the present international commercial disputes tend to rely on some privatized resolutions, and the ongoing international commercial arbitration, international commercial mediation and other ADRs can best describe it.However, over recent years, the excessive institutionalization and litigation of arbitration also brought the disadvantages of lengthiness of arbitration and high cost, etc. Consequently, some more moderate and expeditious dispute resolutions develop very fast, especially the mediation methods. With the increase of international commercial mediation practice, people are becoming more and more aware of the importance of mediation. With the rapid development of mediation, there arise some theoretical and practical problems in mediation, such as the problems of legal effect and implementation of mediation agreement and settlement agreement.The problems of legal effect in international commercial mediation agreement refers to that the validity conditions of the mediation agreement and the legal bindings of the agreement, and there are some discrepancies of legal bindings about the mediation agreement in some international and domestic legislations. The most attractive parts about the legal bindings of mediation agreement are the trends of mandatory mediation that appear in Britain and Hong Kong. In terms of the practical needs of dispute resolution, the mediation agreement should be conferred with legal bindings and even support the mandatory mediation.The final purpose of the parties choosing mediation is to resolve their disputes and the successful resolution depends on the implementation of the settlement agreement. If the settlement agreement reached by the parties does not have legal bindings, which means either party can abandon the agreement at any time, it will greatly limit the development of the mediation as a kind of settlement mechanism of international civil and commercial disputes. Theoretically, the settlement agreement between the parties should at least have contractual bindings and this has been acknowledged by legislations and practices in some countries. There have been many discrepancies as to whether one party can apply to the court for compulsory execution on condition that the other party refuses to fulfill the settlement agreement. Undoubtedly, the compulsory execution of settlement agreement would attract more parties to choose it to resolve the dispute, and it will facilitate the resolution of disputes.There still exists some great margins in law in China's international commercial mediation, and in 2009 the Supreme Court's 'opinion' provided some guidance for the execution of the settlement agreement and the legal effect of the settlement agreement, but it's still imperfect. Our country should encourage the applications of mediation methods in international civil and commercial disputes with more positive attitude, and confers more clearly the legal effects to the mediation agreement and the settlement agreement.In terms of the characteristic of international commercial disputes and the characteristics of the settlement mechanism of commercial disputes, the development of international commercial mediation is a must trend in the future. Just as pointed out by scholars, the settlement mechanism of international commercial disputes has been through a path of development of'arbitration—combination of arbitration and mediation—mediation'. Therefore, concerning of the practical needs, the reasonable and rapid resolution of international civil and commercial disputes, and the expansion and development of international commercial activities, the international commercial mediation agreement and the settlement agreement should be conferred with clear legal effects and even the power of compulsory execution.