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Law Ministry planning to introduce new laws for settling commercial and civil disputes at a faster pace

Dated: June 20, 2018

The law ministry is taking steps to prepare a legal framework for settling commercial as well as civil disputes in India at a faster pace. As per a top official, the ministry will be bringing in a mediation law so that the intervention of the court is reduced and there is ease in doing business in the country. The state is looking forward to amending the Arbitration and Conciliation Act (ACA), the Commercial Courts Act, the Specific Relief Act and planning to create a new law for the creation of New Delhi International Arbitration Centre.

It must be observed that the average time taken for a commercial dispute to get resolved in the country is around 1445 days, which constitutes more than 4 years. Currently, the bill amending the specific relief act and creating the state arbitration center is pending in the parliament.

The country is facing a severe challenge pertaining to the long pendency of court cases. To solve the pendency, the current government has taken a lot of steps. In the year 2015, the government introduced Arbitration Amendment Act, 2015 and thereafter it introduced Commercial Courts Act in 2015.  One of the biggest concerns of the law ministry is that mediation is still not being used as an alternative dispute mechanism. Mediation does not have a legal backing as well as a regulatory backing. Moreover, a mediator has no authority to make a binding decision unless both parties have agreed to give power to the mediator.

The current government is taking all steps to ensure that India becomes a nation which comes up in the ease of doing the business ranking. As per the current ranking, India has jumped 30 positions to become the top 100th country in terms of ease of doing business ranking this year. The same was announced by the World Bank Group’s latest Doing Business 2018: Reforming to Create Jobs report in Delhi on 31, October 2017. In the said ranking, ‘enforcement of contracts’ carries significant weight.

A law ministry official has stated that the government will also create a professional arbitration body to be named the Arbitration Promotion Council of India which would be headed by the Chief Justice of India for promoting the country as an International arbitration hub.