On September, 12, 2020, the Singapore Convention on Mediation finally became a reality. Considering that we are in the midst of a global pandemic, I believe there is now a dire need for dialogue, mediation and collaboration. While the Singapore Convention provided cross-border mediation with greater credibility, the current business environment, with its compromised supply chains and limited markets, provides an even greater incentive for parties to strive for mutually agreed-upon outcomes, which will usually be faster and cheaper than those offered by other mechanisms. I spoke to JAMS panelist Gary Birnberg about the past and future of cross-border mediation. Gary is a member of a new initiative, the JAMS and Shanghai Commercial Mediation Center (SCMC) joint mediation panel, which may become a template for others to follow. Below is an excerpt of our conversation:
Ranse: It's been more than a year since the Singapore Convention was opened for signature, which was followed by a great deal of excitement. What are your observations about the Singapore Convention, in terms of what it promised and where we are now?
Gary: We're living in a completely different age than we were a year ago. I think it's useful to remember that in June 2019, we weren't sure if there would be more than a handful of signatories to the Singapore Convention. On the day of the initial signing, we knew that China, India and the United States would be part of it, but it triggered all sorts of awareness of and interest in mediation, at least theoretically, that we did not expect.
Ranse: So it really has raised awareness about mediation, particularly as it relates to cross-border disputes?
Gary: Most definitely. Looking back, mediation was somewhere in the stratosphere two or three years ago, but with the signing of the Singapore Convention, mediation was suddenly considered mainstream, and that was pivotal.
Ranse: You've been involved in many events promoting the convention, both before and after the signing ceremony in August 2019. How has the message changed?
Gary: At the time of and shortly after the signing, the question was will it have an impact? Will it deliver on its promise? And although it has not yet delivered on its full promise, we have assurances, from the legal and business communities, that it will. Mediation will play an increasingly more prominent role in commercial dispute resolution worldwide.
Ranse: What is cross-border mediation? What does it do and how does it work? Why should disputants use mediation to resolve cross-border cases?
Gary: I think that we have to consider the status quo and how the legal profession works. Before the Singapore Convention, a lawyer advising a corporate client or an in-house lawyer advising his or her own company, always thought about what could go wrong, such as "If we reach a settlement that’s ultimately unenforceable, then I would be embarrassed, my client would be justifiably upset and frustrated, and the whole exercise would have been a waste of time.” That problem now has a potential solution. When the Singapore Convention goes into effect, its initial application might be limited because of the mechanism required for ratification; however, there is an expectation that the Singapore Convention will encourage cross-border disputants to consider using mediation to settle their disputes.
Ranse: It’s one thing to talk to people who are mediation converts or can understand its potential, but how can you convince those who are still skeptical about using mediation for cross-border disputes?
Gary: That’s a great point. First of all, we are confronted with skepticism on many levels. We will often ask a skeptical party, "Why are you skeptical?" A common response—one that I've heard may times over the years—is "Well, I once was in a mediation, and it didn't work out so well." Another reason is that mediation may be a great tool for family disputes, but not necessarily for commercial disputes. And the list goes on.
You need to get to the source of the skepticism. In the context of commercial mediation, a skeptic, if he or she doesn’t already know, needs to understand that mediation has been successfully used in disputes involving multiple parties and millions or sometimes billions of dollars at stake. You then can encourage the skeptic to consider the alternative to settling a matter in mediation. That's a very important point to emphasize. In my experience, cases that did not settle in mediation may have been subject to a very lengthy and expensive litigation process.
We also have to remind commercial parties that in mediation, they have the power to come to their own conclusion, to come to their own resolution, rather than cede that power to an arbitrator or a judge. That is an incredibly powerful tool that does have repercussions, not only in terms of the specific resolution, but also in relational terms. The dispute resolution process should become a strategic tool for the businessperson, as opposed to a cost center and a burden, over which he or she has little control.
Ranse: I get a sense that it's the enforceability that provides credibility, as well as the fact that this emerged from a global initiative.
You’ve worked with parties from all over the world. How has this cross-cultural experience informed your practice and helped you as a international mediator?
Gary: That’s an interesting question. Let’s say two parties in a dispute come to the mediation table and are considering a fixed set of events that led to a falling out. Each party is blaming the other one for what went wrong and is looking for some way to be made whole. So we're talking about a divergence in view about a set of circumstances. And that itself is sort of a metaphor for cross-cultural disputes in general. People speak different languages. They have different cultural backgrounds. They have different ways of doing business.
Ranse: Yet, aren’t there also similarities?
Gary: Yes. And here I remind parties about their mutual desire to reach an agreement. For me, mediation is all about trying to understand what the parties’ thoughts are regarding the dispute, communicating with them that I understand their positions and developing a joint vision of how to come to a resolution.
Ranse: There has been much talk about the potential of the Singapore Convention; however, in order for it to succeed, we must take action. One example of this is the newly formed JAMS/SCMC joint mediation panel, which was created to work with parties in the U.S. and China that have cross-border disputes, but there is also an expectation it will eventually provide assistance worldwide. As a member of this panel, what do you think it offers that isn't currently available?
Gary: Another very good question. I think it's a number of things, first of all is mainstreaming the concept of collaborative mediation. I say “collaborative” in the sense of having more than one mediator. It's something that we generally shy away from in our practice and that our clients don't often request—this idea of having two minds instead of one, two points of view instead of one.
The second point is the model that we're talking about is having a culturally aware Chinese mediator and a U.S./European counterpart for conflicts between a Chinese party and an American party. I think this is extremely important psychologically for the users. And it's not as if the American or European mediator is going to represent the Western party, and vice versa. It's that the parties will be assured that their thoughts will be understood, their expressions will be appreciated and their needs will be addressed.
Now I’m not implying that all cultures are monolithic, but there are certain characteristics that are more typically seen in China/Asia and those that are more common in the U.S./Europe. Our willingness to bridge the divide goes a long way toward addressing the needs of the disputants in any conflict.
Ranse: I think the JAMS/SCMC joint mediation panel is a great way to demonstrate the benefits of the Singapore Convention and to encourage cross-border dialogue and cross-border mediation. Do you think that this panel could actually be an example to other institutions or other models?
Gary: It could be a game changer. Because the mainstreaming of collaborative mediation, which I referred to earlier, was triggered by the signing of the Singapore Convention and we’ve had a year of development of thought, I think mediation will become much more accepted and prevalent. And the cross-border aspect is something that other organizations are not addressing.
I believe that this will be a model for structuring “mediation templates.” And I don't mean this in a rigid sense, but in terms of an East-West conflict and an Eastern and a Western mediator. They'll work as a team, and they'll tackle problems that require cross-cultural competence and expertise. I think that there will be great demand for this type of service and that this will trigger other institutions to follow our lead.
Ranse: Thank you very much for taking time to discuss your thoughts about the Singapore Convention, the joint panel and the value that a collaborative dialogue and cross-border mediation can have, particularly for those who are in challenged environments, who are dealing with multiple stresses.
For the Singapore Convention to succeed, parties must be willing to engage in cross-border mediation. Mediation may be just the tool to deliver the successful outcome we all know is possible.