Mediation can play a crucial role in improving the efficiency of insolvency proceedings, resolving disputes among multiple creditors, and fostering consensus among diverse stakeholders. It can help reduce delays and costs, thereby increasing the likelihood of successful restructuring for businesses and delivering better returns to creditors. This is particularly important during the “pre-commencement” stage, where a financially distressed yet viable company seeks informal, out-of-court solutions.
In light of the same, Section 5 of the Mediation Act becomes important as it allows parties to voluntarily resolve civil and commercial disputes through pre-institution mediation, either with or without an existing mediation agreement,…
