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Drafting Efficient Dispute Resolution Clauses

The use of model alternative dispute resolution (ADR) clauses and submission agreements is encouraged to ensure that the important elements of a dispute resolution clause are provided for and to avoid any ambiguity which may later lead to difficulties and delays in the dispute resolution process. WIPO model clauses and submission agreements have been carefully drafted by experts to allow parties to define principal elements such as the place of arbitration or mediation, applicable law, language of proceedings, appointment of mediator or arbitrator.

Combining ADR Procedures

To maximize the benefits that ADR procedures have to offer, parties can combine the different procedures by commencing, for example, with a mediation phase, to be followed in the absence of settlement by an arbitration phase. Some 30% of the mediation, arbitration and expedited arbitration cases filed with the WIPO Center included an escalation clause providing for WIPO mediation followed, in the absence of a settlement, by WIPO arbitration or expedited arbitration.

There are model clauses for each WIPO ADR procedure as well as for combinations of these procedures. This is an example of a frequently-used combined clause, including a brief explanation of the more relevant elements of the clause:

Mediation Followed, in the Absence of a Settlement, by [Expedited] Arbitration

“Any dispute, controversy or claim arising under, out of or relating to this contract and any subsequent amendments of this contract, including, without limitation, its formation, validity, binding effect, interpretation, performance, breach or termination, as well as non-contractual claims, shall be submitted to mediation in accordance with the WIPO Mediation Rules. The place of mediation shall be [specify place].1 The language to be used in the mediation shall be [specify language].2

If, and to the extent that, any such dispute, controversy or claim has not been settled pursuant to the mediation within [60][90] days of the commencement of the mediation,3 it shall, upon the filing of a Request for Arbitration by either party, be referred to and finally determined4 by arbitration in accordance with the WIPO [Expedited] Arbitration Rules. Alternatively, if, before the expiration of the said period of [60][90] days, either party fails to participate or to continue to participate in the mediation, the dispute, controversy or claim shall, upon the filing of a Request for Arbitration by the other party, be referred to and finally determined by arbitration in accordance with the WIPO [Expedited] Arbitration Rules. [The arbitral tribunal shall consist of [a sole arbitrator] [three arbitrators]5.] The place of arbitration shall be [specify place].6 The language to be used in the arbitral proceedings shall be [specify language].7 The dispute, controversy or claim referred to arbitration shall be decided in accordance with the law of [specify jurisdiction].”8

Informal Explanatory Notes:

1 Although the WIPO Center has offices in Geneva, Switzerland and in Singapore, the parties are free to select any location in the world where they want the mediation to take place.

2, 7 The parties can choose any language that suits them.

3 This WIPO model clause allows parties to move from the mediation to the arbitration phase if a party fails to participate in the mediation. Also, setting a timeline for mediation in a multi-tiered clause helps the case stay on track towards a settlement or agreed follow-up procedure.

4 The appointed arbitral tribunal has the authority to render a final award. Such award is binding on the parties and enforceable internationally. However, parties retain the option to settle the dispute before an award is issued.

5 When deciding whether to appoint one or three arbitrators, parties weigh considerations of cost and efficiency against the value and complexity of the dispute. Under the WIPO Expedited Arbitration Rules the arbitral tribunal consists of a sole arbitrator.

6 The choice of “place of arbitration” determines the law that regulates the procedural framework of the case, such as the availability of interim measures of protection and the enforceability of the award. Regardless of their chosen place of arbitration, the parties may hold meetings or hearings anywhere in the world, at the convenience of parties, arbitrator(s) and witnesses.

8 The parties are encouraged to choose the substantive law, i.e., the law under which the arbitral tribunal decides the dispute.

WIPO Clause Generator

Parties are strongly advised to use model ADR clauses and submission agreements; however, where deemed useful, they can adapt model clauses and submission agreements to their further needs. For such specific cases, the WIPO Clause Generator proposes additional elements based on WIPO case experience.

The WIPO Clause Generator allows parties to develop their clauses and submission agreements through the following steps:

1. Select type of disputes (i.e., future or existing);

2. Select type of WIPO ADR procedure(s) (e.g., WIPO Mediation, WIPO Arbitration, WIPO Expedited Arbitration, or appropriate combinations);

3. Select clause core elements, and, if desired, any additional elements;

4. Download or copy the final result.

If you need further assistance when drafting your clause, you can contact us by email at arbiter.mail@wipo.int or by phone at +41 22 338 8247.

Unilateral Request for WIPO Mediation

The WIPO Center is regularly contacted in relation to disputes where one party wishes to submit a dispute to mediation, but no mediation agreement exists between the parties, for example in infringement disputes or in cases pending before the courts. To facilitate submission of such disputes to WIPO Mediation, a party may submit a unilateral Request for Mediation to the WIPO Center under the WIPO Mediation Rules. The WIPO Center may then assist the parties or, upon request, may appoint an external neutral to provide the required assistance. This process has been used successfully by parties in a number of cases.