Among the debates over cross-border movement of private agreements and adjudicatory decisions, one theme is little explored: the domestic reception of corporate agreements mediated in a foreign country. This article presents a brief overview of the problem, with particular reference to Brazilian law, and introduces the potential conclusion of a new convention on the subject, to be signed in Singapore in 2019.
The contemporary doctrine and practice of private international law deals with the reception of arbitral and judicial decisions. There have been successful treaties in this area, including the “New York Convention” on the Recognition and Enforcement of Foreign Arbitral Awards (1958), and texts that have not yet reached a high number of ratifications, such as the Hague Convention on the Recognition and Enforcement of Foreign Judgments in Civil and Commercial Matters (1979). Incentives to party autonomy have also been strong, whether through the pragmatic concept of “lex mercatoria“—by definition, a law of merchants, not of States—or as seen in the recently-concluded Principles of The Hague on the Choice of Law in International Commercial Contracts (2015).
Thus, in the form of treaties, customs and soft law, private international law has dealt with commercial contracts—the results of direct negotiation between parties—and with arbitration and judicial decisions; a middle way, however, appears to have been omitted. Mediation is a process in which parties negotiate and attempt to resolve a dispute with the assistance of a neutral third party, who is not an adjudicator and who uses sophisticated and specific methods of behavioural analysis and rapprochement to facilitate agreement between parties.
Let’s take Brazil, a rising market for international arbitration, as an example. Brazilian law, which gives legal status to mediation through Resolution 125/2010 of the National Council of Justice, the Civil Procedure Code of 2015 (CPC-2015), and Federal Law 13.140 / 2015, has failed to confer clear and adequate juridical treatment and protection to corporate agreements mediated in other countries. Article 784 of the CPC-2015 is actually quite comprehensive regarding recognition of foreign contracts. However, Article 917 of the same Code allows too many arguments to be raised before a Judge, in order to prevent the enforcement of such obligations. Using Article 784, in an analogical interpretation, for mediated agreements would open the way for dilatory maneuvers; a specific treatment for foreign mediation, therefore, is desirable. On the other hand, the debate around the applicable law is currently limited to the generic terms of CPC-2015 and to the old Brazilian legislation on private international law—Presidential Decree No. 4.657/1942—making it very hard to determine the “nationality” of mediation.
Recent efforts by the United Nations Commission on International Trade Law (UNCITRAL) could help to relieve this problem. Established in 1966, UNCITRAL seeks global collaboration on economic matters through the proposal of treaties and model laws, distinct strategies that allow States to standardize or harmonize their laws in accordance with international standards. Among its most outstanding initiatives are the United Nations Convention on Contracts for the International Sale and Purchase of Goods (CISG), and the Model Arbitration Law. The first of these was incorporated into Brazilian law via Presidential Decree No. 8327/2014, and the second inspired domestic legislation in the form of Federal Law No. 9307/1996.
In 2002, following the success of its initiatives on arbitration, UNCITRAL drafted a Model International Conciliation Law, which deliberately covered conciliation and mediation procedures—the differences of which are recognized by Brazilian doctrine and law. As of June 2018, only thirty-three countries had adopted legislation inspired by this model law, whereas eighty have implemented legislation based on the Model Arbitration Law, and eighty-nine have ratified the CISG.
UNCITRAL first discussed a Convention on the Enforcement of International Commercial Settlement Agreements Resulting from Mediation in New York in 2015. Commencing at the Commission’s sixty-second session, discussions were concerned with the enforceability of agreements resulting from international commercial mediation or conciliation, with no distinction being made between the two. Agendas continued to refer to what was called “conciliation” right up until the sixty-seventh session, in Vienna, on October 2017. At the following session in February 2018, once again in New York, the purpose of establishing a convention on “mediation” was finally clarified. However, doubts persisted about the “internationality” of mediation, and especially “when” it becomes necessary to assess whether an agreement is international: at the time at which the parties decide to participate in mediation—the current position of the European Union—or at the time at which they conclude the transaction, closing the procedure.
As it is the norm in treaty discussions, there remain undecided concepts within UNCITRAL Convention drafts, pending the release of the final document. Preparatory work intensified in June this year, and the proposed convention is expected to be finalized by the Commission in 2018 before being formally signed in Singapore in 2019, according to information from the International Mediation Institute (IMI).
Due to their globally encompassing nature, the discussed UN proposals are a positive step. As the Brazilian example demonstrated, there is a risk that national laws might not deal properly with what “international” mediation actually is, and how foreign agreements should be enforced. Such omissions could discourage the use of mediation due to the lack of legal certainty regarding enforcement.
In summary, the main obstacles to recognition of foreign mediated corporate agreements are the lack of clear criteria for defining nationality and the absence of a specific legal classification, elements that would facilitate the determination of the applicable law and enforcement of the deals. It is hoped that UNCITRAL’s final proposal will ensure consistent treatment of mediation—an approach which has been increasingly successful in resolving transnational corporate disputes, and deserves to be treated and valued for what it really is: a legal instrument.
TRANSLATED AND ADAPTED FROM https://www.jota.info/opiniao-e-analise/artigos/por-que-uma-convencao-sobre-mediacao-comercial-internacional-e-necessaria-07072018, published 7 July 2018