India has taken a significant step towards strengthening its Alternative Dispute Resolution (ADR) mechanism with the enactment of the Mediation Act, 2023 (Act) on September 15, 2023. The Act applies to all mediations in India and provides a comprehensive regulatory and supervisory framework for the conducting mediations.
At present, not all sections of the Act have come into force and as per government notifications[1], only specific sections pertaining to the definition of mediation, the establishment of the Mediation Council of India, the Mediation Fund, and other procedural aspects have been implemented so far.
Key Features:
■ Mediation to Include Conciliation: The Act’s definition of mediation encompasses conciliation under Section 3(h), effectively merging the two processes and eliminating any legal distinction between them.
■ Mediation Council of India: The Act establishes the Mediation Council of India as a regulatory body, under Section 31 responsible for registering, recognizing, and regulating mediation institutions and mediators in India. The Council will promote domestic and international mediation, facilitate training and education, and maintain a depository of mediated settlement agreements.
■ Enforcement of Mediated Settlement: Once the relevant sections come into force, the mediated settlement agreement will be final, binding, and enforceable as if it were a judgment or decree passed by a court, in accordance with the provisions of the Code of Civil Procedure, 1908. The same has been provided for under section 27 of the Act.
■ Prohibitions on dual roles of Mediators: Section 17 of the Act prohibits mediators from acting as arbitrators or representatives/counsel in any arbitral or judicial proceeding concerning the same dispute subject to mediation. This provision could impact the Mediation-Arbitration process by disallowing the dual functionality of the neutral party.
■ Impact on the Arbitration and Conciliation Act, 1996: The Mediation Act, 2023, introduces the Sixth Schedule, which will amend the Arbitration and Conciliation Act, 1996, by subsuming its conciliation provisions. Once enforced, the conciliation chapter of the Arbitration and Conciliation Act will be rendered void, and the Mediation Act will reign supreme as the law governing mediation in India.
■ Confidentiality: Section 22 of the Mediation Act emphasizes the confidentiality of mediation proceedings, requiring the mediator, mediation service provider, parties, and participants to keep certain matters confidential, subject to exceptions for the purpose of registration, enforcement, and challenge of the mediated settlement agreement.
Once the remaining sections of the Act are brought into force, it will provide a comprehensive legal framework for mediation in India, streamlining the process and promoting efficient dispute resolution.
Stakeholders, including mediators, mediation institutions, and parties involved in disputes, must stay updated on the implementation progress and adapt to the new regulatory landscape.
[1] Notification no. CG-DL-E-09102023-249277 dated October 9, 2023