Business mediation and arbitration: useful alternatives
Mediation and arbitration are dispute resolution methods that can serve as alternatives or complements to the courts. Understanding the differences helps in choosing the most suitable path for the case.
What distinguishes mediation from arbitration
In mediation, an impartial third party helps the parties build, by themselves, a consensual solution. In arbitration, one or more arbitrators decide the dispute, and the decision usually carries force equivalent to that of a court judgment.
Advantages that are often noted
Each method has its own characteristics. Among the points frequently highlighted are:
- Confidentiality of the procedure
- The ability to choose specialists in the subject
- Procedural flexibility
- The potential to preserve business relationships
When each method is usually recommended
Mediation tends to be suitable when there is an interest in preserving the relationship and building an agreement. Arbitration is usually considered in more complex contracts, where the parties prefer a technical and binding decision outside the courts.
The arbitration clause
Arbitration generally arises from a clause set out in the contract or from a subsequent agreement between the parties. The wording of this clause directly influences the scope and rules of the procedure, which is why it usually requires attention.
Frequently asked questions
Can an arbitration decision be reviewed by the courts?
As a rule, the courts do not re-examine the merits of the arbitral decision, but they may review formal and validity issues in the cases provided for by law.
Do mediation and arbitration work for any dispute?
They are usually recommended for rights that allow settlement, especially in business relationships. Their suitability depends on the type of dispute and on what was agreed.
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