Government Sets Up Mediation Council of India Following Parliamentary Committee Nudge

Nearly three years after the law was enacted, the Indian government has established the Mediation Council of India (MCI) to regulate mediation proceedings in the country. The formal setup follows a nudge from a parliamentary committee.

A Union law ministry notification issued on Thursday night announced the establishment of the council under the Mediation Act, 2023. Initial provisions relating to the constitution and functioning of the MCI were first notified on October 9, 2023, while rules concerning its composition and service conditions have now been brought into force.

The newly formed council is mandated to regulate and promote institutional dispute resolution. Additionally, it will recognize mediation service providers and institutes that train and certify professionals.

Last year, Attorney General R Venkataramani attributed the delay in setting up the MCI to a shortage of human resources and challenges in finding suitable candidates for statutory bodies.

The department-related Standing Committee on Law and Personnel had previously taken note of the law ministry's clarification that establishing the MCI was a key prerequisite for the full implementation of the Act, alongside the formulation of detailed rules and regulations. In its report on India's arbitration ecosystem tabled in Parliament earlier this month, the panel emphasized that the expeditious operationalization of the council is critical to unlocking the full potential of the legislation.

Institutional arbitration and mediation are two methods being promoted by the government to settle commercial, civil, and family disputes outside traditional courtrooms. While arbitration cases are adjudicated, mediation cases are settled through conciliation, with an institutional mechanism ensuring that settlements are binding on rival parties.

"The formal establishment of the Mediation Council of India is a necessary step toward strengthening the institutional framework for dispute resolution in the country. For businesses and commercial enterprises, having a structured, reliable alternative to lengthy courtroom litigation helps reduce legal friction and ensures faster resolution of disputes. Operationalizing such statutory bodies effectively will be key to building confidence in India's commercial and legal ecosystem." — Dr. Shishir Gupta, Founder & CEO, StartupLanes