The Combined Use of Mediation and Arbitration in Commercial Dispute Resolution: Results from an International Study

Abstract

In a changing international commercial dispute resolution landscape, the combined use of mediation and arbitration has emerged as a dispute resolution approach offering parties a number of benefits. These include resolving parties’ disputes cost-effectively and quickly and obtaining a binding and internationally enforceable decision. However, to date there has been little agreement on several aspects of the combined use of processes. The academic debate is ongoing about acceptable ways of combining mediation and arbitration. At the same time, there is little evidence to suggest that practitioners actually use a combination of mediation and arbitration. This article analyses the results of a recent empirical study of the current use of mediation in combination with arbitration in international commercial dispute resolution. The results reveal that the combined approach is used to a relatively low extent, which contrasts with widespread recognition of the benefits that it seems to offer. In vast majority of cases, the mediation and arbitration stages are conducted by different neutrals, while the mediation stage usually involves the use of caucuses. Surprisingly, as appears from the study, the absence of a unified enforcement mechanism for international mediated settlement agreements does not present any obstacle to recording the outcome of the combined use of processes in a mediated settlement agreement rather than in an arbitral award.