The Potential Impact of the Singapore Convention on Mediation: A Construction Industry Perspective from the UAE

The construction sector plays a significant role in the economic development of the United Arab Emirates (UAE) as an engine of growth attracting investors and participants from different parts of the world. The complexity of the construction industry coupled with the diverse nature of the participants in a typical construction project often leads to disputes. Mediation offers the parties an opportunity to resolve their disputes in a timely and cost-efficient manner while preserving their business relationships. Although study has shown that mediation is the second most utilized method of resolving construction disputes in UAE after negotiations, the main obstacle in its uptake has been the lack of enforceability of mediated settlement agreements across borders due largely to UAE’s nonmembership of the Singapore Convention on Mediation. The lack of a legal framework that provides for effective enforceability of mediated settlement agreements (MSAs) concluded in the UAE in foreign jurisdictions and vice versa acts as a disincentive to the use of mediation in resolving international business disputes including construction disputes in the UAE. Accession to the Singapore Convention will not only encourage parties to international construction contracts in UAE to resort to mediation as a preferred method of resolving their disputes but could potentially, strengthen the country’s competitive position as a center for not only international arbitration but also international commercial mediation as membership of the Convention makes the enforcement of MSAs concluded in the UAE in other jurisdictions and vice versa much easier.