March 29, 1996, Geneva, Switzerland
Discussion
The Use of Conciliation in Arbitration
Robert Badinter (Chairman)
Thank you for those considerations on the practice of mediation within the context of arbitration. The least one can say is that it is not an institution of overwhelming originality, since it has been commonly practiced, I think, in all procedures, and under all latitudes. In arbitration, everyone tries at one moment or another to arrive at conciliation. This does not, however, detract in any way from the outstanding oratorical merit of our speaker.
Angelo Volpi Neto (Curitiba, Brazil)
I am President of a mediation institute of Brazil. In Brazil we have the experience that, when the people know that the mediator can exercise functions that are arbitral, they do not tell all the truth, because they know that the truth can be used against them. We feel that sometimes it is difficult when people know that the mediator will be the judge or arbitrator. I do not know the situation in other countries and I know that the culture in Brazil is very, very different from China. But, in Brazil, people would not become very deeply involved in the mediation if they know that the mediator can act as the arbitrator.
Gino Lörcher (Cologne, Germany)
If the conciliation statement is repudiated, as you said was possible for either of the parties in such a procedure, what is the experience in practice? Does the arbitration award then usually follow the conciliation statement or does it deviate? May I just add, for the sake of completeness, that the German rules were invoked just now about promoting the reaching of settlements in civil procedure under German law. This is not only applicable to arbitral tribunals, but also applicable as a general rule of civil procedure by all tribunals that act in civil procedure.
Tang Houzhi (Beijing, China)
China promulgated a new Arbitration Law last year. Before that, a conciliation settlement was not enforceable. Now, according to the new Arbitration Law, the conciliation settlement can be enforced by the court. According to Chinese law and Arbitration Rules, if conciliation conducted by the arbitrators is successful, then the arbitrator or arbitrators may make a conciliation statement or make an arbitration award. Before the new Arbitration Law, according to the CIETAC Rules, if conciliation was successful, the arbitrators were obliged to make an arbitration award according to the contents of the settlement agreement for the convenience of enforcement. Now, according to the new law, both a conciliation statement and an arbitration award made by the arbitrators are enforceable.
Éva Horváth (Budapest, Hungary)
I am the President of the Hungarian Court of Arbitration. Professor Tang Houzhi stated that both a conciliation statement and an arbitral award are of the same legal validity and worth. I am wondering how you apply the conciliation statement in the case of international arbitration, because I am not quite sure that, on the basis of the New York Convention, you could enforce it.
Tang Houzhi (Beijing, China)
Perhaps we could make some joint efforts to have a convention or instrument for the enforcement of conciliation settlements. There is some hope. If one of the parties repudiates the conciliation statement before he signs it, the conciliation statement is not valid. The best way for both parties is to ask the arbitration tribunal to make an arbitral award according to the settlement.
Nilima M. Chandiramani (Bombay, India)
I teach international trade law to the postgraduate students at the University of Bombay. It is believed that there are many nations whose mentality and culture favours mediation. We have heard that, even in the Arab countries or in China, mediation is a forerunner to arbitration proceedings. The same is the case in India. In fact, in India there were, during the olden days, the Shrines or the Guilds which decided commercial disputes. The question is whether mediation should remain as a forerunner to adjudicative processes, or should it be a formalized, legalized procedure separate and independent from the adjudicative process? I would like to have comments on this point?
Tang Houzhi (Beijing, China)
The Indian law or Act is called the Indian Conciliation and Arbitration Ordinance. According to that ordinance, you encourage conciliation and encourage the combination of a conciliation and arbitration.