What is mediation?
In essence, mediation (or Reconciliation, Conciliation) is the process of negotiating between parties in order to settle the disputes with the help from a third party (called mediator). Mediation shares many similarities with negotiation except one, there is no third party in negotiation guiding other parties through negotiating process.
Moreover, different from arbitration, mediator doesn’t have the jurisdiction over the case to give final judgment (arbitral award). Their obligation is only to conduct the mediation in certain order, to instruct parties through the process and to ensure the whole process is going one the right direction. Mediation has the following basic characteristics:
A third partial, also known as mediator, is a bridge, in term of connecting both parties within the dispute, to help parties to reach an agreement on the settlement of the dispute. That third party has an independent position and share no benefit with any parties of the dispute (alike arbitrator);
The agreement in the mediation process is decided by the parties. Such agreement has no binding enforcement which depends mostly on the willingness of the parties to implement.
Pros of mediation
Mediation procedure is conducted promptly and flexibly;
Parties can determine by themselves any person to become mediator as well as place of mediator. Therefore, with such choice, parties can select person whom has expertise knowledge on the issues of the case;
With friendly nature, mediation is designed in order to maintain and develop relations for both parties’ benefit, and thus, in general, cause less damage to parties’ inherent relation;
Confidentiality,
Mediation and arbitration
Mediation and arbitration features are quite similar to each other such as confidentiality, neutrality, freedom of parties and many more. However, those features still extremely different based on magnitude. Such as freedom of choice, for instance, both arbitration and mediation give parties the right to choose mediator – arbitrator, the main differences is that parties are free to participate or not to participate in the mediation while in arbitration, parties are bound to arbitration agreement and therefore, cannot choose to withdraw from any arbitral procedure.
Binding might be the biggest differences between mediation and arbitration. As mentioned above, parties do not have the right to choose to withdraw from arbitration while they can choose in mediation. On the other hand, arbitral award is final and binding both parties to implement. In the case of mediation, its minute doesn’t bind parties to implement, its enforcement mostly depends on parties’ willingness.
In essence, mediation (or Reconciliation, Conciliation) is the process of negotiating between parties in order to settle the disputes with the help from a third party (called mediator).
In 2018, a range of FTA agreements have been into effect, the competition becomes more cutthroat. Therefore, the risk of disputes among Vietnamese enterprises as well as disputes between Vietnamese enterprises and foreign enterprises have increased.
On 24 February 2017, the Government of Vietnam promulgated Decree No.22/2017/ND-CP on Commercial Mediation (the “Decree”). It is the first legislation specifically governing commercial mediation in Vietnam.
On February 24, 2017, The Government promulgates the Decree No. 22/2017/ND-CP on commercial mediation.
Misconceptions about commercial mediation
Enterprises' decision to choose a dispute resolution method is greatly influenced by what attorneys or in-house counsels advise them. In particular, commercial mediation is a method that brings high efficiency and has the potential for development. However, this method has yet to receive good recognition from many attorneys and has not been chosen by clients. The cause of this comes from several misconception, mainly as follows.
Up to 2023, 25 institutions, including 17 mediation centres and 8 arbitration centres with the additional unit providing mediation, were established in accordance with the approval of the Ministry of Justice. Currently, KCAB International Arbitration Committee (KCAB International) is the first and only arbitration institution to open its liaison office in Vietnam; however, there is no foreign mediation institution’s office opened in Vietnam. Regarding the number of mediators, according to the list established by the Ministry of Justice, there are more than 100 registered ad-hoc mediators, not to include the listed mediators of mediation institutions. Regarding the number of cases, Vietnam Mediation Centre (VMC) has received 36 cases from 2018 to March 2023, 91% of which parties reached a mediation settlement agreement and enforced it voluntarily.
Introduction
Mediator is not a commonly known job in Vietnam, contrary to the deep-rooted development of Mediators in other countries. In developed jurisdictions, namely the UK, Hong Kong, and Singapore, a Court, prior to accepting the case, usually encourages parties in dispute to resolve at an out-of--Court mediation center to assure the objectivity of a mediator and the confidentiality of the mediation process.
Normally, to be a professional mediator, a person needs to meet specific standards of expertise, soft skills, ethics, and – in the circumstances – age limit. The age limit depends on an individual’s experience, but to be a professional mediator, it is commonly advisable that he is older than 35 or 40 years old.
The causes leading to disputes in the construction sector.
Construction disputes are varied. With more than 25 years of experience in dispute resolution in Arbitration and Court, the author finds that construction disputes are mainly concentrated in 5 main causes:
Mediation
Mediation is one of four dispute resolution methods: Negotiation, Mediation, Arbitration, and Court. In fact, it is very common to achieve that the two parties negotiate on their own, negotiating with each other is mediation or self-reconciliation. Legally, mediation must always have a third person or mediator as a mediator. If there is no third factor, it is the method of negotiation.
