The Implementation in Israeli Law of the United Nations Convention on International Settlement Agreements Resulting from Mediation, signed 7 August 2019

Dear Clients and Colleagues,

On 22 July 2024, the Israeli parliament amended the Courts Law [consolidated version], of 5744-1984, adding a provision allowing Israeli courts to give a mediation agreement, to which the Singapore Convention on Mediation (the “Singapore Convention” or “the Convention”) applies, the force of an Israeli judgment, in accordance with the rules of the Convention, where the parties so agreed (the “Amendment”).
As we previously updated when the draft of the Amendment was published in April 2021, the Singapore Convention is a uniform instrument for the enforcement of international settlement agreements resulting from mediation. It applies to settlement agreements resulting from “international” mediation, concluded by parties, to resolve a commercial dispute.

Israel signed the Singapore Convention on 7 August 2019, and following its ratification by three countries, the Convention entered into force as of 12 September 2020. To-date fifty-seven countries have signed the Convention, and fourteen have ratified it.
Prior to the Convention enactment, mediation settlements were enforced as a contract, subject to each jurisdiction’s individual legal regime.

The Convention aims to create a uniform and efficient method for enforcement of international mediated settlements, in a similar (though not identical) manner to that of Arbitral Awards, the mutual enforcement of which was agreed in the Convention on the Recognition and Enforcement of Foreign Arbitral Awards of 10 June 1958 (commonly known as the “New York Convention”).

Following the Amendment, the previously proposed Courts Regulations (Implementation of the Singapore Convention with Regard International Mediated Settlements), 5781-2021 may be enacted (“the Proposed Regulations”).

The Amendment and Proposed Regulations, give the force of International Mediated Settlements a considerable boost, elevating International Mediated Settlements, to a similar standing with international arbitration awards, or domestic mediation settlements reached in the framework of pending Israeli litigation, allowing for their direct recognition and enforcement by the Israeli courts, with only limited discretion.

As per the Convention and Proposed Regulations, the court will generally enforce an International Mediated Settlement except for certain limited instances, specifically delineated in the Convention and Proposed Regulations (lack of party capacity; the settlement is null and void or incapable of being performed by the law to which the parties subjected it; the settlement is not binding or not final according to its terms or has subsequently been modified; the commitments have already been fulfilled, or are not clear or comprehensible; the relief would be contrary to the settlement’s terms; the mediator committed a serious breach of applicable standards; the mediator failed to disclose circumstances that raise justifiable doubts with regard his impartiality or independence; relief would be contrary to public policy or the subject matter of the dispute is not capable of settlement by Israeli law).
We will continue to update on any further developments. Of course, if any specific guidance is necessary, we would be more than happy to provide you with assistance.

Sincerely,

International Dispute Resolution Team
The Litigation and Dispute Resolution Department
Herzog Fox & Neeman