KARACHI, Nov 12: The International Finance Corporation, the private sector arm of the World Bank Group, has signed an MoU with the High Court of Sindh to establish a pilot court-referred mediation centre in Karachi.
The pilot centre is expected to serve as a model for Pakistan, an IFC press release said.
IFC is promoting the institutionalization of mediation as an alternative dispute resolution (ADR) mechanism for the private sector.
The project’s goals are to mitigate expensive and lengthy court procedures incurred by the private sector, to help extricate small and medium businesses from litigation, and to help release assets caught up in legal disputes.
The project is establishing a pilot mediation centre in Karachi, a hub for business investors and industry.
According to IFC Pakistan’s commercial dispute, settlement processes are generally considered discouraging to market-based growth and to domestic and foreign investment.
Small and medium businesses commonly face five to 10 years litigation processes, and courts are backlogged with cases. A third of these cases are commercial in nature, many of which go to trial. Individuals and businesses have little alternative recourse in the event of a contract breach, which creates a disincentive for foreign and local investors to do business in Pakistan.
The IFC project will work with the High Court of Sindh to support the pilot mediation centre. The High Court and selected District and Session Courts will be handled by trained mediators following international best practice.
The project would also help professionalize mediation through training, mentoring, certification, and registration of mediators, and it would campaign to raise awareness and promote mediation among the country’s practitioners, end-users, and general public.
In August this year, IFC and the government convened a workshop in Karachi on institutionalizing mediation in Pakistan. The workshop was supported by the Ministry of Law, Justice, and Human Rights, as well as the country’s judiciary, bar, and private sector.
The workshop shared international experiences in ADR mediation, with guest speakers, including Lord Justice Carnwath, Lord Justice of the UK Court of Appeal, Justice James Ogoola, Principal Judge of High Court of Uganda, and Justice A.M. Ahmadi, former Chief Justice of India.
These senior judges cited the positive impact of mediation on the judicial systems in their countries, where a large percentage of commercial cases are settled out of court through court-referred or pre-court mediation, substantially reducing the backlog of cases in courts.
For businesses, this has meant faster resolution of disputes and the freeing up of assets and working capital. Early resolution of disputes has also reduced the risk of bankruptcy and business stagnation and has raised investors’ confidence in the legal system.—APP
