India: Mediation Council of India Establishment Notified Under 2023 Act

• The Central government formally established the Mediation Council of India (MCI) on August 27, under the Mediation Act, 2023.
• Headquartered in Delhi, the MCI will regulate mediators and recognize mediation service providers and training institutes.
• The Mediation Act generally encourages pre-litigation mediation for civil and commercial disputes, making it mandatory only for specific commercial disputes under the Commercial Courts Act, 2015.
• Parties can withdraw from mediation after two sessions, and the process is generally limited to 120 days, extendable by another 60 days with agreement.
• Disputes involving criminal prosecution or third-party rights are deemed unsuitable for mandatory mediation.

The Mediation Act, 2023, introduces a requirement for individuals involved in civil or commercial disputes to first attempt to resolve their disagreements through mediation before pursuing litigation in courts or tribunals, though this is generally voluntary except for specific commercial disputes under the Commercial Courts Act, 2015.

The Central government has officially announced the formation of the Mediation Council of India (MCI), a significant step in institutionalizing alternative dispute resolution mechanisms within the country. This establishment, formalized through a gazette notification issued on August 27, operates under the provisions of the recently enacted Mediation Act, 2023.

The notification explicitly states that the Council is being created to fulfill the objectives of the aforementioned Act. It further specifies that the Mediation Council of India will establish its primary administrative office in Delhi, serving as the central hub for its operations and regulatory functions.

The Mediation Act, 2023, introduces a requirement for individuals involved in civil or commercial disputes to first attempt to resolve their disagreements through mediation before pursuing litigation in courts or tribunals, though this is generally voluntary except for specific commercial disputes under the Commercial Courts Act, 2015. This legislative framework underscores a shift towards encouraging amicable settlements outside traditional judicial processes.

The newly formed Mediation Council of India is tasked with overseeing the entire mediation framework established by the Act. Its responsibilities are comprehensive, encompassing the registration of qualified mediators, the recognition of various mediation service providers, and the accreditation of mediation institutes. These institutes play a vital role in the ecosystem by providing essential training and certification programs for aspiring mediators, thereby ensuring a standardized quality of service.

It is important to note that not all disputes fall under the purview of mandatory mediation. The Act specifically identifies certain categories as inappropriate for this process, including matters involving criminal prosecution or those that could impact the rights of third parties. The Central government retains the authority to modify or expand this list of excluded disputes as deemed necessary.

The Mediation Act, 2023, also outlines specific procedural guidelines and timelines for the mediation process. Parties engaging in mediation are granted the flexibility to withdraw from the proceedings after participating in a minimum of two sessions, providing an avenue for disengagement if progress is not being made.

Regarding the duration of mediation, the Act stipulates that the process should ideally conclude within 120 days from its commencement. However, recognizing the complexities that can arise in dispute resolution, it also allows for a potential extension of an additional 60 days, provided all parties involved mutually agree to prolong the mediation period. Furthermore, if all parties concur, they possess the autonomy to appoint any individual of their choosing to serve as their mediator.

Lawyers and compliance officers in India must now advise clients on the operationalization of the Mediation Act, 2023, particularly regarding mandatory pre-litigation mediation requirements. They should also understand the Mediation Council of India's role in regulating mediators and service providers, and the specific timelines and withdrawal rules for mediation processes.

Source: Original reporting via government gazette notification