New Life, New Rules - A short introduction to the DIAC Mediation Rules 2023
As I settle into life as a construction disputes lawyer in Dubai, it has quickly become clear that, similar to the UK, mediation is swiftly becoming a prominent feature in dispute resolution in the Middle East.
One of the most recent updates to mediation in the Middle East was the introduction of the DIAC Mediation Rules 2023 (the “Mediation Rules”), which were issued by the Board of Directors of the Dubai International Arbitration Centre (the “DIAC”) in July 2023 and came into effect on 1 October 2023 (just before I arrived!).
The Mediation Rules govern any requests for mediation submitted to the DIAC and follow the DIAC Arbitration Rules 2022 (see Appendix II Article 3, which sets out the Conciliation Proceedings process). Prior to the Mediation Rules coming into force, there were no other mediation or conciliation rules to regulate mediation proceedings.
Summary of the Mediation Rules
Having familiarised myself with the rules, I have set out below a brief summary of some of the key points that may be of particular interest to readers of this blog.
The Mediation Rules govern the entire mediation process – from the drafting of relevant mediation contractual provisions, the mediation process, settlement and everything in between. On the drafting side, the Mediation Rules provide suggested wording for parties to consider when contemplating the use of mediation or arbitration (or both!) during the negotiation phase of commercial contracts.
In terms of the mediation process itself, the Mediation Rules include (but are not limited to) the following:
(i) Parties can refer a dispute to mediation under the Mediation Rules, even if there is no pre-existing agreement to mediate. However, all Parties must agree to mediate for the mediation to actually proceed.
(ii) The Mediation Rules prescribe the Application for the commencement of mediation, along with timescales for submissions. This provides for a 15-day period for the Reply from the Responding Party, with a potential 7-day extension period.
(iii) Parties, and the Mediator, agree the fees and expenses of the Mediator at the time of the preliminary meeting. This is to include mandatory deposits from the Parties involved.
(iv) The Arbitration Court shall appoint the Mediator, although Parties can agree to nominate a Mediator, or co-Mediators in appropriate circumstances, within certain time limits. In addition, parties may object to the Mediator within 5 days of the notification of appointment.
(v) There is a general scheme for the conduct of the mediation, including the forum of any meetings, mediation statements and draft settlement agreements.
(vi) The mediation shall be deemed concluded in certain circumstances, namely:
a. if there is no Reply to the Application in the timeframes set out in the Mediation Rules;
b. if the Application is withdrawn on the basis that no deposit has been paid within the required time limit;
c. where the Mediator concludes that no further mediation attempts will assist the parties and / or dispute at hand;
d. where a Party withdraws from the mediation;
e. where Parties agree to terminate the mediation; or
f. upon execution of a settlement agreement.
In addition to the above, the Mediation Rules are clear that the mediator and the process itself shall be impartial, free of conflicts and conducted confidentially; as well as being fair, efficient, and proportionate to the dispute.
Furthermore, on the crucial issue of confidentiality, the Mediation Rules confirm that, should the mediation fail, all documents/information relating to the mediation (including all materials produced for its purpose) shall remain confidential and not be used in any judicial or arbitration proceedings relating to the same dispute. This will no doubt provide comfort to, and perhaps encourage, parties considering mediation.
Looking ahead…
Mediation has been utilised in the region for many years. However, the introduction of the Mediation Rules reveals the willingness in the region to bring structure to such proceedings. In addition, the Mediation Rules provide comfort and clarity on the benefit of mediation for parties considering engaging in submitting requests to the DIAC, particularly with regard to time & cost efficiencies and the fairness & confidentiality of the mediation process.
I am looking forward to having a front row seat of the impact the Mediation Rules have in the future facing disputes landscape of the Middle East!
Amy Roberts
Associate, CMS (Dubai office)