United Nations Convention on International Settlement Agreements Resulting from Mediation (Singapore Mediation Convention)

The United Nations Convention on International Settlement Agreements Resulting from Mediation, also known as the Singapore Mediation Convention, (''Convention'') which regulates the enforceability of settlement agreements that resolve international commercial disputes through mediation, was adopted by the United Nations General Assembly on 20 December 2018 and signed by Turkiye on 7 August 2019. The Convention was ratified on April 21, 2021 and entered into force on April 11, 2022 pursuant to the Presidential Decree dated February 24, 2022 and numbered 5235. The Convention establishes the enforceability of settlement agreements concluded as a result of the mediation of international commercial disputes, thereby eliminating the lack of a mechanism to recognize the legal effect of mediation settlement agreements in foreign countries and encouraging the settlement of international commercial disputes through mediation. In this respect, even if the parties to the dispute are not Turkish, settlement agreements that fall within the scope of the Convention will be enforceable in Turkiye, and similarly, settlement agreements concluded in Turkiye regarding cross-border commercial disputes will be enforceable in states parties to the Convention.

1. Scope of the Convention

The Convention applies to written settlement agreements of an international nature that arise from a mediation process for the resolution of a commercial dispute.

1.1. The Settlement Agreement Must Result from the Mediation Process

For the Convention to be applicable, the settlement agreement must arise from mediation. The Convention's definition of mediation does not emphasize the specific terminology of the dispute resolution process; but rather centers on the facilitation of the process by a third party without authority to impose a binding decision. Therefore, it is immaterial whether the mediation is mandatory or voluntary, or whether it stems from a pre-existing contract or occurs after the dispute arises, or whether it is instructed by a court or an arbitrator. Furthermore, there is no requirement for the mediator to be a lawyer or listed in a mediation registry; any third party can conduct the mediation process.

The party relying on the settlement agreement is required to submit to the competent authority of the state where relief is sought a document certifying that the settlement agreement results from the mediation process. The Convention specifies examples of such documents, including the mediator's signature on the settlement agreement, a document signed by the mediator confirming the mediation occurred, and an attestation from the institution that administered the mediation. In the absence of these documents, other evidence acceptable to the competent authority may be presented.

1.2. The Settlement Agreement Must Have International Nature 

The Convention does not use the place of mediation to determine whether a settlement agreement is of international nature. Instead, it bases this assessment on the parties' places of business. In this respect, for a settlement agreement to be considered international, at least two parties to the settlement agreement must have their places of businesses in different states. However, even if the parties have their places of business in the same state, if (i) a substantial part of the obligation arising from the settlement agreement is to be performed in a different state, or (ii) the state to which the subject matter of the settlement agreement is most closely connected is a different state, the settlement agreement will be deemed to have an international nature. Therefore, even if the parties have their place of business in Turkiye, the settlement agreement will fall within the scope of the Convention if a substantial part of the obligation is to be performed outside of Turkiye or if the state most closely connected to the subject matter of the agreement is not Turkiye, provided other conditions are also met.

If a party has more than one place of business, the relevant place of business is the one most closely related to the dispute resolved by the settlement agreement, considering the circumstances known to or contemplated by the parties at the time the agreement was concluded. Additionally, if a party does not have a place of business, reference is to be made to the party’s habitual residence.

1.3. The Settlement Agreement Must Be in Writing

For a settlement agreement to fall within the scope of the Convention, the agreement must be in writing. A settlement agreement is deemed to be in writing if its contents are recorded in any form. This includes settlement agreements made electronically, provided that the information is accessible for subsequent reference. It is also accepted that there is no requirement for the settlement agreement to be issued as a single document.

1.4. The Dispute Must Be Commercial 

The Convention does not explicitly define "commercial disputes." However, scholars emphasize the need for a broad interpretation of the term, given the Convention’s overall purpose. It is also accepted that investment disputes fall within the scope of commercial disputes. 

2. Excluded Settlement Agreements

Family, consumer, labor and inheritance-related matters are completely excluded from the scope of the Convention. Additionally, settlement agreements that have been approved by a court or concluded in the course of proceedings before a court and that are enforceable as a judgment in the state of that court, as well as those recorded and enforceable as arbitral awards, are also excluded due to their specific enforceability.

3. Grounds for Refusal of the Relief

The grounds for refusal of the relief are limited and specified in Article 5 of the Convention. The existence of the relevant grounds for refusal has a discretionary rather than coercive effect on the competent authority's decision. The competent authority may accept a request for relief even if the grounds for refusal are present.

3.1. Grounds for Refusal That Must Be Requested and Proven by the Party Against Whom Enforcement of the Settlement Agreement is Sought:

• One of the parties was under incapacity;

• The settlement agreement is null and void or inoperative or incapable of being performed under the law which the parties have subjected it

• Settlement agreement is not binding or final according to its terms;

• Settlement agreement is subsequently modified;

• The obligations in the settlement agreement have been performed;

• The obligations in the settlement agreement are not clear or comprehensible;

• Granting relief is contrary to the terms of the settlement agreement;

• There was a significant breach of the mediation standards, without which the party would not have entered into the settlement agreement;

• Failure to disclose to the parties circumstances that raise justifiable doubts about the mediator's impartiality and independence;

3.2. Grounds for Refusal to be Determined Ex officio by the Competent Authority:

• Granting relief is contrary to public policy;

• The subject matter of the dispute is not capable of settlement by mediation.

4. Enforcement of Settlement Agreements under the Convention

The Convention does not provide specific procedural rules for the enforcement of settlement agreements, leaving this matter to the States Parties to the Convention. In line with this framework, an amendment to Law No. 6325 on Mediation in Civil Disputes, enacted on May 5, 2023, introduced a provision for enforcing international settlement agreements. According to this amendment, the competent court to obtain an enforceability annotation is determined as the commercial courts of first instance. Regarding territorial jurisdiction, a sequential jurisdiction provision has been established. The enforceability annotation shall be sought from the court of the venue agreed upon by the parties. If no such agreement exists, from the court of the other party's domicile in Turkiye, or from the court of other party’s place of residence if there is no domicile in Turkiye. If neither applies, it should be sought from the courts of Ankara, Istanbul or Izmir. The examination will be conducted through file, without holding a hearing, in accordance with the Convention and Article 18 of the Law No. 6325 unless a hearing deemed necessary.  

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