Singapore, Japan jointly launch mediation service to settle business disputes due to Covid-19

SINGAPORE – Businesses involved in disputes with Japanese companies during the coronavirus pandemic can resolve them more cost effectively and quickly through a new mediation service started by the Singapore International Mediation Centre and its counterpart in Japan.

Under the joint protocol, companies will have access to a mediation service starting at $6,500 and capped at $16,000 per party, regardless of the value in dispute.

This costs less than other forms of dispute resolution such as arbitration and litigation, which typically run to six figures.

The mediation will also be organised within 10 days, with SIMC and the Japan International Mediation Centre both providing a mediator each, to bridge the legal and cultural differences between the parties.

Settlement agreements arising from the mediation may be enforced under the Singapore Convention on Mediation that came into force on Saturday in Singapore. The United Nations treaty has also been ratified by five other countries including Fiji, Qatar, Saudi Arabia, Belarus and Ecuador.

The joint protocol comes on the back of concerns that disputes arising from disruptions related to Covid-19 should be resolved quickly in the interest of business and economic recovery.

It follows a similar protocol that SIMC launched in Singapore earlier this year.

SIMC said it is also working with partners around the world on similar protocols that will be customised to the needs of the specific jurisdictions.

With Japan and Singapore among each other’s largest investors, the two countries share extensive business ties.

In a statement, SIMC said the protocol was the first tie-up of its kind between two international centres.

SIMC Chairman George Lim said: “The joint protocol offers parties the best of both worlds as they can discuss their disputes with mediators who understand the unique aspects of their respective cultures and jurisdictions.”

Meanwhile, chief director of JIMC Haruo Okada said that the pandemic has caused “disruptions and conflicts all over the world that no one has ever experienced” and for which there are no applicable rules and precedents, making such disputes particularly suitable for mediation.

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