Bringing business disputes to court takes time and money, and
may be too much in the public eye. Even though arbitration and
mediation centres can offer firms a faster, confidential solution,
they have their own problems, particularly in developing
economies.
To address common operational issues, ITC brought together more
than 60 directors of centres from 50 developing and developed
countries at a Symposium on Strengthening Commercial Arbitration
and Mediation Services (Chamonix, France, September 2004). Some of
the world's foremost institutions in the field were present,
including the International Chamber of Commerce, the International
Federation of Commercial Arbitration Institutions and the United
Nations Commission on International Trade Law.
New centres, especially in developing economies, benefited from
the experience of well-established institutions in the efficient
management of commercial disputes. Experienced centres could
evaluate fresh ideas.
High demand for services
The sheer volume of cases in an era of increased trade is an
important factor in operating a centre. South Africa's Commission
for Conciliation, Mediation and Arbitration - the most outstanding
example - has settled some 340,000 cases since January 2000 and
handles 500 cases on a daily basis. The caseload shows that case
managers need excellent organizational skills, on a par with their
knowledge of arbitration.
Often, however, there are few trained staff available for the
secretariats, not to mention for the pool of arbitrators. To
survive, centres cannot rely just on providing arbitration or
mediation services, but also have to engage in training. Creating
an association for young lawyers, especially women, has helped
Germany's institution boost numbers of trained arbitrators.
Changing mindsets
Managers also stressed the diplomatic and awareness-building
skills required of them. Centres have to network with the
"traditional" legal profession, from legislators to court
officials, to raise awareness of their services. Participants
learned that such efforts have paid off in the United Kingdom,
where the Centre for Effective Dispute Resolution now receives
referrals through the court system.
Various centres explained how they are working to raise the
profile of arbitration and mediation services with the business
sector. Most are linked with the national chamber of
commerce.
Practices to build visibility and confidence range from using
experienced foreign arbitrators when starting up a centre, to
providing free services to small firms that cannot afford the costs
of a trial to organizing activities such as conferences.
Specializing in solving the disputes of particular sectors or
industries - from consumer disputes to construction and sports - is
also an effective way to build a solid client base.
From competition to collaboration
Another recurring challenge is competing for business with other
centres in one country. In Latvia, for instance, over 100 centres
offer dispute resolution ser-vices. Participants proposed two
solutions to this probem. Centres can merge, as happened in
neighbouring Lithuania. Another approach, adopted by the 25 new
centres in Argentina and six in Switzerland, is harmonization.
Agreeing to use the same procedura rules and undertaking a
collective "branding" effort helped raise the profile of all their
centres, nationally and internationally.
Centres are also linking up on a regional and international
basis. Giving support to client companies wherever their business
activities take them is a growing trend, reflected by the many
cooperative agreements that larger arbitration centres have reached
with counterparts around the world. "We believe that creating or
reinforcing our ties with the arbitration centres of the 14 member
states of the Southern Africa Development Community is important,
because South African companies are conducting business and
investing in these countries," said Danie van Wyk of the
Arbitration Foundation of Southern Africa (AFSA).
Enhancing dispute resolution services
All participants agreed that arbitration and mediation services
are here to stay, and play a growing part in international trade.
As a result of this meeting, ITC is helping centres establish an
open network for technical assistance among them, flowing
South-South and North-South, but also South-North.
For example, ITC and several southern African countries, in
cooperation with AFSA, are working on a cooperation agreement
between centres in the region. The initiative was driven by demand
from business circles to ease disputes between, for instance, firms
from South Africa and Madagascar, or Mauritius and Mozambique. ITC
is using the expertise of centres in the area to lead the project,
such as AFSA, the Arbitration and Mediation Centre of Madagascar
and the arbitration centre of the Mauritius Chamber of
Commerce.
Also at the request of business, the centre in Madagascar is
linking with the Indian Council of Arbitration, due to an increase
in disputes arising from more business being done between these
countries.
In another outcome of the meeting, several arbitration centres,
impressed by the effectiveness of non-adversarial approaches, are
looking into providing conciliation and mediation services along
with their existing arbitration services. They include the centres
in Algiers (Algeria), Estonia and Geneva (Switzerland).
Getting the message to others
Several participants published reports on the meeting in their
journals and on their web sites, among them the centres in
Cameroon, Geneva, Kuala Lumpur (Malaysia), Madagascar and Mexico.
The Chartered Institute of Arbitrators in London, probably the
world's foremost reservoir of arbitration experience, also set up
an online networking forum for the managers of arbitration and
mediation centres to continue the discussions begun at the
meeting.
"The Chamonix meeting of arbitration and mediation centre
managers is set to become a regular feature in the calendar of
events for dispute resolution services," said Jean-François
Bourque, ITC's Senior Legal Adviser and the organizer of the
symposium. The next meeting is scheduled to take place early in
2006. Participants will look more closely at setting up mediation
and conciliation services for the business community, with examples
from developing and transition countries in particular. These often
have cultural traditions of mediation, and are leading the way in
devising less conflictual solutions to business disputes.
Part of the changing business landscape
For ITC, settling business disputes rapidly and efficiently is
an essential link in the chain tying suppliers and buyers together.
"Mediation and arbitration centres of developing and emerging
economies have a unique role to play to help their countries join
in the world economy," said ITC's Executive Director, J. Denis
Bélisle. "Not only do they provide methods for solving the disputes
that inevitably arise from trade, but they can promote ways to
prevent commercial disputes and provide direct support to the
business community at the operational level."
It is no longer in question that providing such services
contributes to a competitive business environment. "If you want to
do business in Mauritius, you know that you will be subjected to
international arbitration rules," said Barnen Pillay of the
Permanent Arbitration Court of the Mauritius Chamber of
Commerce and Industry. An efficient dispute resolution system will
attract investors and business people to a country, in the same
manner as its transport systems, and macroeconomic and fiscal
policies.
Out-of-court dispute resolution services have brought new and
innovative concepts - from partners to processes, techniques
and attitudes - into the legal and business landscape. For
instance, many women manage arbitration and mediation
centres.
For more information, contact Jean-François Bourque, ITC Senior
Legal Adviser, atbourque@intracen.org