In August 2019, China and 45 other states signed the UN Convention on International Settlement Agreements Resulting from Mediation, also known as the Singapore Convention. This highlights the importance of understanding the history and current state of mediation in China.
1. History of Mediation in China
The history of mediation in China can be divided into four stages:
(1) From 1949 to the 1980s: Highly praised
After the founding of the People’s Republic of China in 1949, the government promoted “mediation as the primary” method of dispute resolution. This mainly involved the use of people’s mediation committees set up in local communities. During this time, the state had a strong presence in all aspects of society, and state-driven mediation was widely accepted. As a result, mediation played a vital role.
(2) From the 1980s to the 1990s: Sharp decline in mediation
As China began its reform and opening up process in 1978, the state’s influence in society decreased, and its support for mediation also weakened. People no longer recognized the authority of mediation and turned to lawsuits, leading to a large number of disputes being handled in courts.
(3) The first decade of the 21st century: Rise of court-connected mediation
To address the pressure of dispute resolution, China launched the “Big Mediation” movement, which emphasized the role of mediation during litigation. Court-connected mediation could occur at any stage of court proceedings, and judges often encouraged litigants to consider mediation.
(4) The 2010s: Out-of-court mediation highlighted
In an effort to address the surge in litigation faced by Chinese courts and also to support the Belt and Road Initiative (BRI), China is now promoting a “diversified dispute resolution” approach, which involves the coordination and connection of mediation, arbitration, and litigation. In this approach, out-of-court mediation is valued, including: people’s mediation, administrative mediation, industry mediation, commercial mediation, and court-connected mediation.
One disadvantage of out-of-court mediation is that the resulting settlement agreement cannot be enforced by the court, as it is essentially an ordinary contract. To support mediation, the newly amended Civil Procedure Law (CPL) of 2012 stipulates that the court may, upon application by the parties, issue a ruling to confirm the validity of the settlement agreement, allowing it to be enforced by the court.
2. Current Types of Mediation in China
There are no comprehensive legal rules on mediation in China, but they can be found in the CPL, the People’s Mediation Law, and rules promulgated by the Supreme People’s Court and the Ministry of Justice. According to these rules, Chinese mediation generally includes the following:
(1) Court-connected mediation
Court-connected mediation refers to mediation conducted during a lawsuit. It is provided for in the CPL and is carried out by a judge in civil proceedings. Mediation is not separate from the trial, but is a part of it. After a settlement agreement is reached, the court issues a “settlement statement,” which, like a judgment, can be enforced by the court.
Since 2016, Chinese courts have been trying to separate mediation from trials and have established a “docking mechanism to connect litigation with mediation” for this purpose. Under this mechanism, the court assigns the case to a specific mediator (including in-court and out-of-court mediators) and the judge is no longer able to mediate during the trial.
(2) People’s mediation
People’s mediation, also known as community mediation, is the mediation
of community residents. It is regulated by the People’s Mediation Law and is typically handled by people’s mediation committees, which are composed of volunteers from the community. People’s mediation is typically used to resolve small disputes involving neighbors, family members, or community members.
(3) Administrative mediation
Administrative mediation refers to the mediation of disputes between citizens and government agencies. It is regulated by the Administrative Mediation Law and is typically handled by administrative mediation committees set up by local governments.
(4) Industry mediation
Industry mediation refers to the mediation of disputes within a specific industry, such as construction or real estate. It is typically handled by industry associations or professional mediators.
(5) Commercial mediation
Commercial mediation refers to the mediation of disputes between businesses or between businesses and consumers. It is typically handled by professional mediators or commercial mediation centers.
3. Mediation in China Today
Despite its long history, mediation in China has faced challenges and has undergone significant changes in recent years. However, it is still an important part of the dispute resolution process in China.
One major challenge has been the lack of a comprehensive legal framework for mediation. While there are various laws and regulations on different types of mediation, there is no overarching law that provides a clear and consistent legal basis for all forms of mediation.
In recent years, there have been efforts to address this issue, such as the signing of the Singapore Convention, which provides a uniform legal framework for the enforcement of settlement agreements resulting from mediation. Additionally, the CPL was amended in 2012 to include provisions on the enforcement of settlement agreements, as mentioned above.
Despite these challenges, mediation continues to play a significant role in resolving disputes in China. In particular, out-of-court mediation has been increasingly emphasized in recent years as a way to address the heavy caseload faced by courts and to support the BRI. It is expected that the role of mediation in China will continue to evolve in the future as the country seeks to find effective and efficient ways to resolve disputes.