What's New in the EU: Israel could benefit from arbitration process

Major projects have been undertaken in recent years in the field of consumer disputes within the framework of the European Union aimed at providing consumers with better access to justice.

By ARI SYRQUIN
'I would like to see more Israelis in the arbitration work of the ICC," said Prof. Pierre Tercier, President of the International Court of Arbitration of the International Chamber of Commerce (ICC), in his speech last week to the Faculty of Law at Bar-Ilan University during the first ever visit to Israel of any person in this position. The ICC sets voluntary rules that companies from all parts of the world apply to millions of transactions every year. The rules created by the Commission on Arbitration, such as the Rules of Arbitration, the ADR (Alternative Dispute Resolutions) Rules, the Expertise Rules and the Dispute Board Rules, have become part of the legal fabric of international commerce. The ICC Commission on Arbitration, Prof. Tercier said, boasts over 450 members from 90 countries, including partners in international law firms, in-house counsels, law professors, experts in different dispute resolution services, and trade executives in member companies and international organizations. "The Commission on Arbitration aims to create a forum for experts to pool ideas and impact new policy on practical issues relating to international arbitration," said Prof. Tercier. "I believe Israelis could, and should, have a bigger share in the ICC's arbitration and other alternative dispute resolutions work," he added. It should be noted that in the last few years there have been developments in "alternative" means of settling or resolving disputes in Israel and in the wider world. The specific advantages of these forms of private justice and the crisis affecting the effectiveness of justice have led to renewed interest in these methods of dispute resolution, which are more consensual than recourse to the courts or arbitration. Considerable efforts have been made (mainly in the US and Europe) to regulate mediation development in order to improve the trust that consumers and small- and medium-sized businesses place in it. One of the factors underpinning the development of mediation is of a practical and conjectural nature. This method offers a solution to the problem of access to justice faced by citizens in many countries due to three factors: 1) The volume of disputes brought before courts is increasing 2) The proceedings are becoming more lengthy and the costs incurred by such proceedings are increasing 3) The quantity, complexity and technical obscurity of the legislation also help to make access to justice more difficult Cross-border disputes tend to result in even more lengthy proceedings and higher court costs than domestic disputes. In addition to the practical problem of overworked courts, these disputes often raise complex issues which involve conflicts of laws and jurisdiction and practical difficulties of finance and language. ADRs are an integral part of the policies aimed at improving access to justice. In effect, they complement judicial procedures, insofar as the methods used in the context of ADRs are often better suited to the nature of the disputes involved. ADRs can help the parties to enter into dialogue where this was not possible before, and to come to their own assessment of the value of going to court. It is worth highlighting the role of ADRs as a means of achieving social harmony. At the Lisbon European Council in March 2000, which was devoted specifically to "Employment and the Information Society," the European Council invited the "Commission and the Council to consider how to promote consumer confidence in electronic commerce, in particular through alternative dispute resolution systems." This objective was reaffirmed at the European Council at Santa Maria da Feira in June 2000 when the "e-Europe 2002 Action Plan" was approved. In the employment relations field, the Brussels (Laeken) European Council in December 2001 "stresses the importance of preventing and resolving social conflicts, and especially transnational social conflicts, by means of voluntary mediation mechanisms …" Major projects have been undertaken in recent years in the field of consumer disputes (domestic or cross-border, connected with the Internet or otherwise) within the framework of the European Union aimed at providing consumers with better access to justice. In the context of the program to improve consumer access to justice, Parliament and the Council, on a Commission proposal, adopted Directive 98/27/EC of May 19, 1998, on injunctions for the protection of consumer interests. Under this directive, the Member States must enable independent public bodies and consumer organizations to bring actions. Where ADRs lead to an agreement between the parties, one might question the scope of such an agreement, in particular in the context of a cross-border dispute. Indeed, the question of the legal qualification of the agreement arising from ADR mechanism is determining the effectiveness of ADRs. However, the variety of names used in the Member States of the European Union for agreements arising from ADR mechanisms makes the picture particularly complex over there. In certain States, ADR can in fact often lead to a simple contractual transaction, but it can also yield other arrangements, such as conciliation minutes or mediation minutes. All these arrangements are in fact "transactions," whatever name is applied to them. Agreements between parties can thus be implemented insofar as they are made enforceable, either because the judge gives his approval and issues an enforceable order or the parties have recourse to an authentic deed executed before a public official, such as a notary. The author is head of the International Department at the Joseph Shem-Tov law firm syrquin@013.net