Commercial Mediation in China: A Practical Guide for Foreign Companies

Introduction

Mediation is the fastest and cheapest way to resolve many China commercial disputes — but only if the settlement can actually be enforced. For a foreign company, the system that matters is judicial confirmation (司法确认): a route that converts a mediated agreement into something with the same teeth as a court judgment. The framework changed materially in 2024–2026, so it is worth understanding precisely.

Two Tracks That Work Differently

China runs commercial mediation on two parallel tracks:

Court-annexed mediation — a court may conduct "mediation first", or entrust or invite a mediator before or during litigation. A settlement reached here can go straight to judicial confirmation;
Independent commercial mediation institutions — bodies such as the Shanghai Commercial Mediation Center (SCMC), the SCIA Mediation Center and the CIETAC Mediation Center — now governed by the new Commercial Mediation Regulation (below).

Judicial Confirmation: The Enforceability Engine

Under the PRC Civil Procedure Law (2023 amendment, in force since 1 January 2024), where parties reach a mediation agreement through a lawfully established mediation organization, the two parties may jointly apply for judicial confirmation within 30 days of the agreement taking effect. Jurisdiction follows the court that invited the mediation, or — for institution-led mediation — the primary court of the parties' domicile, the location of the subject matter, or the mediation organization's seat. On review, the court either rules the agreement valid (making it enforceable on application) or dismisses it, in which case the parties may amend the agreement, reach a new one, or sue. The People's Mediation Law provides a parallel 30-day route for people's-mediation agreements.

A note on citations: the relevant Civil Procedure Law article number is cited in recent materials variously as Article 201 or Articles 205–206. The substance (30-day joint application, jurisdiction rules, valid/dismissal outcomes) is stable; verify the article number against the current official text before relying on it.

The New Commercial Mediation Regulation

The Regulation on Commercial Mediation (商事调解条例, State Council Order No. 827) was adopted 19 December 2025 and took effect on 1 May 2026. It gives commercial mediation agreements binding force, confirms that parties may apply for judicial confirmation under the Civil Procedure Law, and allows cross-border enforcement of a settlement through applicable treaties. Its scope covers trade, investment, finance, transport, real estate, construction and intellectual-property disputes, while excluding family, inheritance, guardianship, labour and consumer matters. It is widely read as domestic groundwork for the Singapore Convention — but it is not ratification of it.

The Singapore Convention: Signed, Not Yet Ratified

China signed the UN Convention on International Settlement Agreements Resulting from Mediation (the Singapore Convention) on 7 August 2019, but has not ratified it as of September 2026. In practice this means a mediated settlement with a Chinese party does not yet enjoy the Convention's direct cross-border enforcement; enforceability abroad still depends on recharacterizing the settlement (for example as a contract, or by folding it into an arbitration award) under the relevant foreign law. Watch the UNCITRAL status table and Ministry of Foreign Affairs / Ministry of Justice announcements for any change.

A Practical Playbook for Foreign Companies

Choose the track deliberately — court-annexed mediation if the case is already in or near court; an institution if you want a confidential, neutral process;
Draft the settlement for enforceability — clear parties, scope, payment terms, and an express statement of which claims it releases;
Apply for judicial confirmation within 30 days — the window is short and jointly required;
If enforcement abroad is needed — build in an arbitration clause or a recharacterization path, since the Singapore Convention is not yet available in China;
Verify the institution and current rules — institutional lists and pilot arrangements change; check the latest official roster.

For the litigation alternative and its timelines, see The Process and Time Required for Trials in Chinese Courts, or contact us to discuss a specific dispute.

How Tianni Law Firm Can Help

Tianni Law Firm (江苏天倪律师事务所), based in Nanjing, Jiangsu, advises foreign companies on resolving China commercial disputes by mediation. Our work includes negotiating and drafting mediated settlements, securing judicial confirmation, coordinating with commercial mediation institutions, and structuring cross-border enforcement where the Singapore Convention does not yet apply.