Singapore Convention Series &#8211

Is Investor-State Mediation An Emerging Practice? A Practitioner’s Perspective

Kluwer Mediation Blog October 16, 2019

Ting-Kwok IU (Kwok, Ng & Chan, Solicitors & Notaries)

Please refer to this post as: Ting-Kwok IU, ‘Is Investor-State Mediation An Emerging Practice? A Practitioner’s Perspective’, Kluwer Mediation Blog, October 16 2019, http://mediationblog.kluwerarbitration.com/2019/10/16/is-investor-state-mediation-an-emerging-practice-a-pr actitioners-perspective/

I have recently been approached to enrol myself in an investor-state mediation training programme and also to speak at one of the sessions. That triggers oﬀ my deeper thoughts on the topic of investor-state mediation and related issues. This blog is an attempt to share my thoughts so that fellow mediation practitioners may consider whether or not investor-state mediation is an area on which they should embark. It is also my hope that my sharing below will also make readers become more aware of the practice of investor-state mediation.

While there may not be a universally acceptable deﬁnition, investor-state mediation entails the resolution of investment disputes through the process of mediation between one party (or more than one party) being private, and the other party being a sovereign state.

Investor-state mediation often includes but is not limited to the following public law dimensions:

Changes in investment incentive measures; Termination or interference of a contract by the state; Revocation of licences or permits; and Unexpected tariﬀs or taxation.

Investor-state mediation also involves international investment law issues such as,

Expropriation; Alleged breach of the “fair and equitable” provision in the contract between the investor and the state; and Interpretation of investment treaties.

(See Recent Developments in Investor-State Dispute Settlement (ISDS) [IIA ISSUE Note, No. 1, 2014] Page 5; Also ‘Fact Sheet on Investor-State Dispute Settlement Cases in 2018 [IIA Issues Note, No. 2, 2019]’, Page 4).

There has also been an increasing involvement of human rights in international investment law. Recently, human rights instruments such as UN Guiding Principles on Business and Human Rights and the “Zero Draft” treaty and an arbitral case Urbaser v. Argentina appear to impose an obligation on both states and companies to prevent human rights abuse in business operations.

As illustrated above, an investor-state mediator, in addition to the possession of usual mediation and process skills, is expected to be knowledgeable about certain specialised legal dimensions as aforesaid which are not normally needed in the practice of private international commercial disputes.

Apart from the requirements of additional legal knowledge, a practitioner may consider whether there are too few disputes for investor-state mediators. While there has been tremendous growth in numbers of investor- state dispute settlement (“ISDS”) since 1992, most of the disputes have been resolved by arbitration rather than mediation. That said, one should note that although mediation did not seem to be following the rising trend of investor-state arbitration, there has been a consistent use of mediation over the period. By way of ﬁgures, since 2003, on average for every two years, one mediation is being recorded. Besides, there is a possibility that investor-state disputes which had taken place under the veil of conﬁdentiality are not reported and thus not known by outsiders resulting in the impression that investor-state mediation is the less preferred means of resolving disputes between states and investors.

In any event, there have been recent calls for reform on investor-state dispute resolution and one of which is the increase of the use of mediation. Investment mediation has been mentioned by delegations such as China, the United States and Albania A/CN.9/930/Rev.1( ) during the course of the working sessions of UNCITRAL Working Group III. Besides, International Centre for Settlement of Investment Dispute (“ICSID”) presented its third working paper on new stand-alone rules for mediation on 16 August 2019. With the signing of the Singapore Convention on 7 August 2019 by 46 states, enforcement of mediated settlement agreements will become a lot easier and more eﬃcient. As such, it is likely that parties to investor-state disputes will be more willing to go for mediation.

States tend to deal with disputes not in the same way as their commercial counterparts because states generally have more non-commercial considerations (for example, the people’s sentiment, criticism from the opposition party/parties, chance of the government being re-elected, and pressures from powerful neighbouring countries, etc.) If the ﬁrst role of mediators is to identify the rights and interests of the parties, then it must be said that this role is even more diﬃcult with the coming in of political issues.see ( ‘Report: Survey on Obstacles to Settlement of Investor-State Disputes’).

Given that investor-state mediation is a very specialised practice, mediators intending to embark on this area of practice will need to receive specialised training. However, those who have received the specialised training may not be assigned to conduct disputes of this nature because the mediator, if appointed must have the trust of the private investor as well as the state. Mediators should also take note that while their skills and knowledge are important considerations for the parties, a mediator’s nationality could also be a factor in the appointment process due to express or implicit nationality requirements. Busy international commercial mediators may ﬁnd the practice of investor-state mediation less attractive if their consideration is purely from a commercial perspective.

While mediators must bear these challenges in mind, they will certainly see that there are always two sides of the same coin. The economic benefits brought by investor-state mediations could be significant. Investor- state disputes often involve claimants and respondents where one party originated from a developed country, and the other from a developing country. These disputes often relate to claims concerning investments on infrastructures, chiefly, information and communication, and the supply of energy resources and such activities are of utmost importance to the two parties, namely the company from the developed country and the government of the developing country. Mediation, being a process with the aim of preserving ongoing relationships and creating win-win solutions has a higher chance of fuelling the pace of developing countries advancing toward a more prosperous future. (See Recent Developments in Investor-State Dispute Settlement (ISDS) [IIA Issue Note, No. 1, 2014], Figure 7; Fact Sheet on Investor-State Dispute Settlement Cases in 2018 [IIA Issues Note, No. 2, 2019], Page 3).

From another perspective, diﬀerent jurisdictions and economic systems belonging to the same country need to resolve disputes in a prudent manner in order to avoid political tension. A prime example is the incorporation of a mediation mechanism for investment disputes betweenHong Kong and the Mainland Government into the Mainland and Hong Kong Closer Economic Partnership Arrangement (CEPA) on 28 June 2017. Under the mechanism, disputes between Mainland Chinese investors and Hong Kong authorities can be brought to mediation on application to relevant institutions. Having such a mechanism will not only preserve and enhance the relationship between Hong Kong and Mainland China but also attract more trades and growth to the region. As such, the dispute resolution mechanism provided for Hong Kong investors in Mainland China and likewise, the dispute resolution mechanism provided for Mainland Chinese investors in Hong Kong only contain mediation mechanism without the installation of the arbitration mechanism.

From a personal development point of view, being included in an investor-state mediation panel would be an honour. Under the ICSID Convention, signatory-state can only provide 4 members to both the panel of arbitration and conciliation. It must be a person of “high moral character”, “with recognised competence in the ﬁeld of law, commerce[…]” and who may be “relied upon to exercise independent judgment”. An appointment would thus be a recognition by the state, and proof to one’s qualities of character and professionalism.

While mediations may be conducted between personnel of the state and the private party, the bigger picture is that the dispute, if not resolved will aﬀect the livelihood of many workers who make a living from foreign investments. Investors tend to invest in primary industries, and primary industries tend to rely on low-paid workers. As such, the mediation work to be involved is more than getting a settlement but a peace-making mission economically and politically.

Although no one could tell with certainty that investor-state mediation shall be the preferred way of resolving disputes between an investor and a sovereign state, a mediator, with the heart to serve, should not refuse an opportunity to receive training in investment law and investor-state mediation training as such training will certainly broaden one’s horizon. Therefore, I venture to appeal to mediators to participate in the practice of investor-state mediation and as a start consider going through the relevant training.

*Credits to Mr Bryan Lai, third year law student at the University of Sussex for his assistance in research on investor-state mediation.

Mediation And The Principle Of Emergence

Kluwer Mediation Blog October 16, 2019

Ting-Kwok IU (Kwok, Ng & Chan, Solicitors & Notaries)

Charlie Irvine in his recent Kluwer blog (Mediation Values: Still Searching) suggested it is our values that determine what we do or say in a mediation rather than any techniques we learn as mediators.

Charlie gives a mediation example where the husband wanted to claim his full pension as part of the division of assets. Charlie was accused of taking sides when he suggested that the law might suggest a diﬀerent result. The wife said she understood Charlie’s point but would accept this apparent unfair outcome.

I had a similar situation. The wife said the husband had worked hard all the marriage and should have all the superannuation. She had not wanted to consult a lawyer. In joint session I asked the husband, who had consulted a lawyer, what his legal advice was re super. He sheepishly set out the law. The wife went silent and I called a private session. She asked for an adjournment to get legal advice.

Both Charlie and I were aware that our respective wives were agreeing to something less than they would legally be entitled. My response was to mediate that particular moment in joint session and allow something to emerge out of the interaction. It moved the focus from the fairness issue to the information and value disconnect between the parties. It forced the husband and wife to interact. This imbalance would otherwise have carried on through the whole mediation.

The Principle of Emergence Mediation is built on the complex interaction between the parties. That interaction leads to something new being created which becomes greater than the sum of the parts. Scientists call this process ‘emergence’.

The American physicist Murray Gell-Mann made the following point “You don’t need something more to get something more. That’s what emergence means.”

Everything in the dispute is there in the person of each party – all we have to do is allow it to emerge. We just have to get ourselves, as mediators, out of its way. Of course, we have our own values, particularly not wanting to let the wife miss out on her entitlement as well as the desire to get a fair settlement for the parties. But we don’t need to add these personal values to get something more for the wife. It is their journey not ours.

The introduction, by mediators, of legal information and in many cases with retired judges, legal advice and opinions, are examples of the use of mediator expertise to help craft a solution. The underlying value is the concept of fairness and justice although, I would argue, there is a deeper subconscious value at play. The desire for the mediator to successfully get a deal done and to be seen as a successful mediator.

I suggest that the desire to get a settlement is the biggest inﬂuence on mediator behaviour. I suspect most mediators don’t see this as a ‘value’ but a natural consequence of their contractual engagement. But it is our attitude to that ultimate goal of wanting a successful outcome that has the most impact on mediator behaviour.

I would argue that it is the prime value driving the solution focused advisory approach to mediation, particularly by lawyers, as evidenced by their preference to be called ‘dispute resolvers’ rather than the more oblique (John Kay – Obliquity Theory) term of ‘mediators’. It can be seen in the practice of mediators using their expertise to hypothesise a solution and then work to close the gap using the caucus or shuttle mediation model to corral the parties towards a compromise.

Stepping back and allowing issues to emerge can bring unexpected outcomes. I have encountered many examples where the wife has been prepared to forego some ﬁnancial entitlement to keep the husband involved with bringing up the children. The fear of being left alone to raise children and the loss of the children’s connection with the father has often, in the mind of the wife, outweighed the fairness consideration.

Allowing this to emerge in the joint session provides an opportunity for both parties to properly consider its implications for their long-term role as parents particularly as to whether it is sustainable over time.

If my intervention with respect to the wife’s legal entitlements did not work, then I would still hold the space for something else to emerge. In the end I would not have hesitated in holding a private session with the wife and telling her that I’m not prepared to go ahead with the mediation unless she got legal advice on this issue. Once she had received proper legal advice I would then have proceeded. It then becomes the wife’s decision as to how she balances the values of family life versus fairness.

This is a boundary issue not a value issue. I set the boundaries within which I as a mediator operate. I would normally mediate with lawyers for each party, with the lawyers either being present or being available in a supporting role.

Tacit Values

Coming back to Charlie’s point on how values inﬂuence mediator behaviour, I would make the point that we do not know our values until we are face-to-face with an ethical dilemma that tests them. It is only after experiencing that experience that we can assess what it disclosed about our values. We can join the dots in retrospect but not in advance. We cannot predict how we will behave in any situation.

This has similarities to how we acquire knowledge. We do not know what we know until we are faced with a situation where we need to apply it. It’s called tacit knowledge. This comes from the work of Michael Polanyi. It can be deﬁned as skills, ideas and experiences that people have but that are not codiﬁed and may not necessarily be easily expressed. As Polanyi puts it, we know far more than we can say. I am therefore suggesting that in addition to tacit knowledge we also have tacit values.

The reason why this is important is that we can never really understand ourselves and the hidden influences that impact on our values. The Welsh have a word for it – Cynefin (kuh-NEV-in). It has no English equivalent. The closest translation is ‘the place of our multiple belongings’. It refers to the fact that we are influenced by multiple things which we may not be aware of including our family history, our DNA, our geography, our faith and our conscious and unconscious social interactions that have built up in us over time.

If we can never hope to understand our values, then it is best that we isolate them from the moment to moment interaction between the parties.

This leads to the ultimate mediator challenge of holding a non-judgemental awareness while actively interacting with the parties. It requires us to detach from our memories, desires and the need to understand what is happening (Wilfred Bion) in order to allow the moment and all its potential to unfold. It’s what makes us a ‘Mediator’ rather than a ‘Dispute Resolver’.

Singapore Convention Series – Strategies of China, Japan, Korea and Russia

Kluwer Mediation Blog October 16, 2019

Ting-Kwok IU (Kwok, Ng & Chan, Solicitors & Notaries)

On 2 August 2019 the “3rd Asia Paciﬁc Conference, Singapore Convention on Mediation: Strategies of China, Japan, Korea and Russia” was held in Seoul, Republic of Korea (Korea).

The Conference centred on theSingapore Convention on Mediation [fn] United Nations Convention on International Setlement Agreements Resulting from Mediation 2019 (UN, New York) [/fn] (Singapore Convention), with distinguished speakers from across the region sharing their opinions and analysis of countries’ perspectives on the Singapore Convention.

This blog post summarises how the Singapore Convention is perceived by countries in the Asia Paciﬁc region, indicating how it may aﬀect existing legal practices for international commercial mediation. It will focus on the perspectives of China and Korea, who have since signed the Singapore Convention, and Japan and Russia, who have yet to sign.

Signatories

Chinese Perspectives

Guiguo Wang (Professor, Zhejiang University) introduced the Chinese perspectives by reference to Confucianism, whereby, harmony is the most desirable state.[fn] Nam Hyeon Kim et al, “Community and Industrial Mediation in South Korea” (1993) 37 J. Conﬂ. Resolut., 361, 362. [/fn] Once interpersonal harmony is disrupted, it can be restored through compromise which is aided by the input of respected intermediaries.[fn] Kim, 362.[/fn] Thus, mediation has always been part of Chinese culture. Traditionally, these mediators were untrained but were able to reach a mutually abided agreement as parties respected and trusted the mediator and their input.

Prof. Wang explained that the formalisation and increased legalisation of enforcement proceedings, as introduced by the Singapore Convention, contrast with these Chinese values. He further explained that, as Chinese culture is based on trust, when individuals agree to abide by an agreement there is little need for an eﬀective enforcement procedure.

Nonetheless, since the Conference, China has become a signatory of the Singapore Convention. As explained by Prof. Wang, a legal enforcement proceeding may not be necessary when conducting business in China, but it has proven very useful in reaching agreements with foreign companies. The Supreme Court of China has established the International Commercial Expert Committee, which aims to resolve disputes concerning the Belt and Road Initiative (BRI) and foreign companies through mediation. Thus, the Singapore Convention is seen as a vital step forwards for the development of international dispute resolution in China.

Korean Perspectives

According to Young Joo Ham (Professor, Chung-Aung University Law School), mediation has been present in Korea for over 50 years. However, many legal practitioners still lack suﬃcient understanding of mediation and its development has stagnated. Prof. Ham stated that the main reason for this is mediation agencies misunderstand the term “mediation”. To remedy this, amongst other issues which impede the evolution of mediation in Korea, policy makers should focus more on the strong points of mediation such as its ﬂexibility, making it easily distinguishable from litigation and arbitration.

Sejun Kim (Assistant Professor, Kyonggi University) explained that the Singapore Convention can be of great use in the development of commercial mediation in Korea. The current legal framework for mediation is governed by the Civil Mediation Act 1990, but this only applies to civil mediation. Here, the force of a mediated settlement agreement (MSA) is equivalent to a judgment and the instigator of the mediation is the court. There is no general law which applies to mediation overall.

Prof. Kim stated that the Singapore Convention can act as the basis of a “Commercial Mediation Basic Law in Korea” (Basic Law). This Basic Law would enshrine the Singapore Convention in domestic legislation. As mediation becomes more popular and there is an international trend to adopt legislation to facilitate this, the introduction of this Basic Law would ensure that Korea continues to evolve with current practices.

This Basic Law should aim to: • ensure that the parties’ subjective views and goals are understood and respected throughout the mediation process; • activate communication between parties; • cause mediation to develop from a “cure model” similar to litigation to a “care model”, focusing on being ﬂexible and fostering negotiation and opposed to all or nothing judgments; and • minimize connection with “trial” and distance it further from litigation.

According to Prof. Kim, under the Singapore Convention the driving force of the mediation is the mediator and the focus is on resolving commercial and international disputes. The Singapore Convention seems compatible with the law in Korea as it does not apply if the places of business of all the parties are located in Korea. Therefore, the Singapore Convention has a diﬀerent scope of application from Korean law and MSAs under the Singapore Convention can be enforced.

Non-signatories

Japanese Perspectives

Shusuke Kaiuchi (Professor, University of Tokyo) correctly predicted that Japan would not become a signatory of the Singapore Convention. In doing so, he made it clear that this does not mean that Japan will never sign the Singapore Convention. Rather, Japan is currently taking a neutral stance, waiting to see how it operates in practice. Prof. Kaiuchi also laid out the two main obstacles which delay the implementation of the Singapore Convention in Japan. Firstly, the Singapore Convention is not compatible with the existing scheme for compulsory execution in a civil matter. Under the Civil Execution Act 1990 (the Act), speciﬁc performance of a civil or commercial claim may be enforced through “compulsory execution”, which is carried out by a court or a court execution oﬃcer. Under Article 22 of the Act, compulsory execution can only be carried out based on a “title of obligation”.

However, MSAs are not included as a listed title of obligation. Thus, amendments to the law are required to include MSAs among the enforceable titles of obligation. However, Prof. Kaiuchi noted that MSAs can be distinguished from many titles of obligations as there is no res judicata to determine the validity of the agreement, despite the minimum procedural guarantee under Article 5(1)(e) and (f) of the Singapore Convention.

Furthermore, even if the validity of the agreement can be confirmed by a court order, enforceability may not be justified due to a number of difficulties, including the mediator being appointed after the agreement has been made solely to facilitate enforcement. Thus, the Singapore Convention is not currently compatible with the existing scheme for compulsory execution in a civil matter in Japan.

Secondly, the Singapore Convention is not compatible with the Alternative Dispute Resolution (ADR) regulations in Japan. Under the ADR Act 2004,[fn] The Act on Promotion of Use of Alternative Dispute Resolution No. 151 of 2004 (Japan), Art. 5. [/fn] agreements must result from a certified mediation service. This is a problem as the Singapore Convention does not require any certification or qualification of a mediator. For international disputes, it seems unrealistic to require agreements to result from a certified mediation service. For domestic cases, it would be hard to enforce MSAs issued by a non-certified mediation service in Japanese courts.

For these two reasons, changes need to be made to the existing Japanese legal framework in order to implement the Singapore Convention. Given the uncertainty surrounding the adoption of the Singapore Convention and its impacts, Prof. Kaiuchi does not consider it to be the most appropriate time for Japan to become a signatory of the Singapore Convention.

Russian Perspectives

Russia did not sign the Singapore Convention either. Natalia Prisekina (Professor, Far Eastern Federal University School of Law) explained that mediation is not the usual method of dispute resolution in Russia. In Prof. Prisekina’s view, most of the support for mediation internationally stems from “judicial shortcomings”, namely a desire to reduce pressure on the costly court system which, due to congestion, is slow and has suﬀered a reduction in quality. For Russian citizens, there is less of a desire to resolve disputes through mediation as the courts are easily accessible and much more eﬃcient and less costly than those in western countries.

The Supreme Court of the Russian Federation has noted three main reasons which actually negate the use of mediation. Firstly, there are organisational issues, as mediators are not readily available and have little experience of mediation procedure. Secondly, there are economic issues, such as the high cost of mediators and the lack of desire amongst judicial representatives to reconcile parties as it reduces their income. The ﬁnal reason is subjectivity, which Prof. Prisekina states is the most important, as the common psychology of Russian society is the main factor which deters parties from mediation. Factors causing this bias against the use of mediation include:

• lack of awareness about mediation; • distrust of the mediator; • lack of negotiation skills and traditions; and • the perception that the court’s decision is more valuable.

This results in parties going to court instead of agreeing on a variety of issues with the assistance of an intermediary, which often would be the most advantageous solution.

The Singapore Convention has the potential to make mediation one of the most popular ways to resolve cross-border disputes. It would help Russian participants of international trade by allowing them to learn from the experience of foreign partners, making mediation more commonly used both in international business disputes and domestic disputes. It would create a basis for the enforcement of international settlements in countries with different legal, social and economic conditions whilst maintaining the flexibility that mediation affords. Additionally, the Singapore Convention would reduce the likelihood of the parties appealing to a court or international arbitration after mediation. Thus, Prof. Prisekina considers that the implementation of the Singapore Convention would help the development of the Russian legal system as a whole.

Comment

The Conference took place amid turbulence in the Asia Paciﬁc region, with ongoing tensions between the host state and Japan. During various presentations, speakers from both countries expressed a desire to resume close social and economic relations. This current political climate exempliﬁes the importance of ADR and mediation, which aim to reconcile issues as well as create positive future relations.

It has been well publicised that 46 countries signed the Singapore Convention on 7 August 2019. Although the exact impact of the Singapore Convention remains to be seen, it presents an opportunity for international commercial mediation to develop signiﬁcantly in the Asia Paciﬁc region and globally, becoming a more widely accepted form of cross-border dispute resolution.

The New Virtual Doors at the “Multidoor Courthouse”

Kluwer Mediation Blog October 16, 2019

Ting-Kwok IU (Kwok, Ng & Chan, Solicitors & Notaries)

I am very happy to share with all of you that on October 28 – 30 I will take part on the 2019 International ODR Forum, in Williamsburg, Virginia, USA, with some of the most outstanding ODR’s thought leaders as Colin Rule, Paul Embley, Daniel Rainey, Ethan Katsh and Orna Rabinovich-Einy, among others. I will be speaking about “the Brazilian Consumer Disputes Boom and first steps in ODR/Legal analytics, conflict mapping and online dispute prevention”, together with my colleague Daniel Becker. I will share with you in first hand a highlight of the topics we will bring to the Forum.

Overall, we are going to present very interesting Brazilian initiatives for ODR being brought to the market by public and private entities related to Consumer Relations. In Brazil, we are understanding more and more how access to justice does not only mean access to the Judge. In a country with 100 million procedures waiting for trial, it is common for parties to spend years before getting an answer, not to mention the amount of money. This is why there are several initiatives for reshaping the system and accepting diverse ways for dispute resolution. We are learning, as Colin Rule stated in an recently article, that “ODR aims to make every mobile phone a point of access to justice, with algorithms dynamically directing cases toward hundreds or thousands of virtual doors available to ﬁt each disagreement to a speciﬁcally crafted and appropriate forum for resolution.”

One of the most relevant case of the Brazilian environment for ODR is Consumidor.gov.br, which is a platform created by the Federal Government in 2015 and dedicated to online dispute resolution for consumer relations. In this platform parts are encouraged to negotiate directly the solutions for their disputes. The rates of success are very high.

Another very successful case is Mercado Livre a large e-commerce company, that provides both a marketplace and payment methods within its platform. Mercado Livre has its own ODR system, with rates of success around 80%. Besides, they added negotiation and mediation clauses in its terms of use, recommending users to seek alternative ways of solving disputes, such as Consumidor.gov.br (where 96% of cases involving Mercado Livre are solved without the need of a lawsuit).

Those initiatives are starting to cause a change on the culture of the system. Earlier this year, Professor Kazuo Watanabe, a prominent Scholar in the ﬁeld, wrote an important opinion (for Mercado Livre) stating that consumers who pursue directly the judicial system without prior attempt to solve disputes through available means, such as Consumidor.gov.br and other private options, have no standing to sue. He said that, in this case, judges could extinguish the procedures or at least suspend for 30 days until they try to solve the issue through ODR systems.

In the same field, we will comment on a real case from April 2019, in which a judge ruled that a consumer who sued a Bank had no standing to sue, because he didn’t attempt any other alternative dispute resolution prior to the judicial. It is interesting that in this case, the judge gave the party 30 days to try to solve the dispute on Consumidor.gov.br, such as Professor Watanabe stated in his opinion (for a similar but different field).

I am very proud to share these experiences at the 2019 International ODR Forum, especially because I am developing myself an ODR company, using Artiﬁcial Intelligence, and I everyday face the challenges of teaching machines how to communicate and negotiate in a positive and empathic way. But this is a topic for future posts. I hope to see you at the Forum!

The magic of empathy

Kluwer Mediation Blog October 16, 2019

Ting-Kwok IU (Kwok, Ng & Chan, Solicitors & Notaries)

Photo credit: Christof Häuser, via Nathalie Birli We mediators are accustomed to recognising empathy as an important part of our mediation repertoire which is consistently reinforced in our training and professional development.

It is front of mind for many of us as we plan for and conduct our mediations. This blog has seen its fair share of commentary. In his February 2018 Kluwer blog Empathy”“ , Charlie Irvine provided an insightful reﬂection on the signiﬁcance of cognitive and emotional empathy and how they work best in combination.

Mediation teachers also continue to reﬁne the tools they use to build a heightened awareness of empathy and its special role. “WithoutIn Compulsion: Teaching Mediators Empathy” https://www.mediate.com/articles/BillikopfG6.cfm, Gregorio Billikopf explains:

“Using a tool I call seven words, participants learn how to: (1) establish a psychological connection through a conversation not related to the issue at hand (a step that may have to be repeated for a period of time before moving on to step two); (2) brieﬂy introduce the fact that they have something important they wish to discuss; (3) speak something of a positive nature about the other party before diving into this topic to be discussed; (4) brieﬂy introduce the topic of controversy by speaking slowly, softly, tentatively and using seven words or less; (5) let the other know they are being heard; (6) share their own perspectives and views now that they have listened to that of the other party; and (7) search for sustainable solutions…”

Even the judiciary recognises empathy’s value in the dispute resolution toolbox. In“Empathy in Mediation: Listening Between the Lines”, Judge Elaine Gordon (ret.) noted that:

“Success at settlement often depends on the mediator’s capacity for empathy. Mediators must display empathy to two competing sides while remaining neutral. It is both an emotional and intellectual task; one in which you put yourself in the shoes of the other person in order to understand that person’s emotions or feelings. A mediator needs to be comfortable with the expression of emotion and curious about the emotional core of a dispute.”

We are also regularly reminded of the delicate balance required to manage the tension between the display of empathy and the appearance of neutrality in an environment where parties can seek to transform our empathetic behaviour into a role as their advocate.

In “Empathy, neutrality and emotional intelligence: a balancing act for the emotional Einstein“, James Duﬀy notes:

“A mediator’s commitment towards empathy and emotional connection is one of the most subtle yet pervasive challenges to mediator neutrality. It is only through strong emotional self-awareness and self- regulation that mediator empathy can possibly co-exist with party perceptions of impartiality.”

A big ‘aha’ moment for me as a result of many of my post-mediation debriefs has been the recognition that sometimes the only way disputants can agree to end their dispute and live with the outcome is when each perceives the mediator to have been empathetic, even if the other party was not. I ﬁnd displaying empathy sometimes works best in private session, so as to avoid arousing unfounded suspicion in the other party that the mediator is biased. However, I have learned to be careful, since it is not unknown for parties to return from a private session with the mediator to give an (often inaccurate) account of what the mediator has said, with the mediator feeling unable to set the record straight.

Despite my long experience of the value of empathy, a recent news item has shown me that I had completely underestimated its potentially lifesaving impact. I read with amazement of the presence of mind of a young woman who was kidnapped, knocked unconscious and held prisoner with the absolute certainty that the outcome would be her murder. I wonder how many of us mediators would be able to follow this young woman’s example. Fearing for her life she was still able to delve deep enough into her repertoire to be able to regain her freedom by expressing empathy to her captor. Lest you think this is the product of a wild imagination let me share with you a spell-binding article from the New York Times: “She Thought He Would Kill Her. Then She Complimented His Orchids.”

Amazing!

All You Need is Love – More Lessons from the Beatles and from Indigenous Australians

Kluwer Mediation Blog October 16, 2019

Ting-Kwok IU (Kwok, Ng & Chan, Solicitors & Notaries)

Music and art make continuing and surprising contributions to Dispute Resolution.

Greg Bond’s June Blog, written as a means of keeping his promise to write about the Beatles, shared lyrics that gave conﬂict a new voice. Synchronicity has been at work and suddenly the Beatles lyrics are getting a lot of exposure in the conﬂict resolution space.

The Centre for the Advancement of Indigenous Knowledge Affairs in Sydney will soon sponsor‘Great the Debate’. Titled ‘All You Need is Love’ the debate is intended to shine a light on the representations and anxieties in our relationships with First Peoples of Australia. While I still know all the words to this Beatles’ song, it did not ever occur to me that this might be a song about a secret weapon for conflict resolution. But it turns out that the Beatles were right and I was completely wrong. Enter my accomplished colleague Dr Emma Lee and the remarkable conflict resolution exercise she labels ‘love bombing’.

Her story is extraordinary.

Appointed last year by the Centre for Social Impact at Swinburne University, Dr Lee is working as Swinburne’s 2018 Aboriginal and Torres Strait Islander Research Fellow. Her doctorate assisted in establishing the ﬁrst joint management plan for the Tasmanian Wilderness World Heritage Area and provided a leadership role for Aboriginal Tasmanians to engage and participate in a range of cultural, economic and conservation functions of management and governance.

Dr Lee is not a lawyer and has no conﬂict resolution training – but she has probably achieved more and with more profound impact than most of us. Recently the media has recognised her remarkable story. Once I saw the headline -‘We ‘love-bombed’ the Tasmanian government to win Indigenous rights’ – I needed to know more. It is a signiﬁcant story and it is particularly important that communities of dispute resolvers have access to it. However it is not my story and I don’t want to fall into the trap of speaking on her behalf because it is her story about her culture. So I have asked Dr Lee to join me in this blogpost.

Over to you Dr Lee.

When Dr Howell contacted me, I soared on high emotion that our Indigenous strategy to heal the trauma of genocide may have resonance for other communities to resolve deep conﬂicts.

A little over a week ago, I attended a flag-raising ceremony at Government House, the highest office of the Tasmanian state, where the Aboriginal flag will now be flown permanently.

This represents a continuation of the eﬀorts to use love and mutual respect to reset the relationship between Aboriginal Tasmanians, government and the broader public away from the violent governance that has characterised the past 200 years and towards healthy and functional communities of proud cultural peoples.

In December 2016 our peoples gained recognition within our Tasmanian State Constitution as First Peoples. This is extraordinary given that since 1876, upon the death of our countrywoman Trucanini, we were globally declared extinct – exterminated as a consequence of colonisation. However, in just under two short years, from raising the idea through to an Inquiry and a parliamentary bill, we were able to reclaim ourselves as contemporary beings away from extinction myths. How did we do this? Well, Indigenous peoples are not known for wealth, so money did not make this happen, nor are we acknowledged as community powerbrokers, so it was not influence either. Instead, it was the love of Elders and others who demonstrated our joy and cultural values of kinship and reciprocity. We welcomed other Tasmanians to become part of our extended families and to see ourselves as brothers and sisters to each other. We thanked the government for our genocide, dispossession and exile and made a compact that in recovering ourselves and our culture we would invite other Tasmanians to join the journey with us. That way, if we fell down, or failed in the first attempt, we would have the support from the general public to dust ourselves off and keep going. We would learn together, and we would listen deeply to each other to respect the multiple opinions and views of our shared communities.

We told the Tasmanian Government that we trust them to do their jobs and make good these relationships and in return our Indigenous leadership was respected to self-determine our futures in our regions and territories. Our peoples reduced the anxiety of the broader community when we agreed on simple, but important, things, such as recognising the right of the Westminster System to make laws in return for the acknowledgement that we are First Peoples and traditional owners. This method means that we do not compromise over rights but come together to create safe negotiating environments for all future generations.

Love is powerful. When we love country, ancestors and Elders, we are able to share that belonging with all Tasmanians to find their place in relation to us. Instead of human rights becoming a toll on our peoples in the struggle for them, they became a place of shared vision, laughter and happiness – human rights can be fun! They can be negotiated from a position of mutual benefit where no one is left behind. We continue tomake gains in education, land and sea management, fisheries, family care and cultural heritage – all new policies, funding, commitments and unique systems of condition-setting rather than proscribed lists of things.

When the Tasmanian Government created a whole-of-government strategy, entitled ‘Resetting the Relationship’, the cornerstone effect has been to reassure Aboriginal Tasmanians that improvement is key and open-door access to ministers means that we can continue the conversations to make stronger existing regulation and laws. Indeed, a powerful outcome has been the signing of a Statement of Intent from both major political parties to respect the functions of the reset policy and place Aboriginal affairs outside of election cycles. There is no better conflict mechanism that when we have set the protocols for respectful relations in place. Our methodology of reducing discrimination, increasing shared power and reclaiming our histories away from trauma has reset the relationship towards trust, enduring decision-making and respectful negotiations. Above all, it has come from Indigenous leadership that is deeply rooted in cultural practices and knowledges that are tens of thousands of years old.

Old songs and old ways will always have important messages that are created anew when we really pay attention them.

Singapore Convention Series – Why China Should Sign the Singapore Mediation Convention: Response to Concerns (Part II)

Kluwer Mediation Blog October 16, 2019

Ting-Kwok IU (Kwok, Ng & Chan, Solicitors & Notaries)

In Part I, I introduced and responded to concerns relating to China’s legal and judicial system if China signs the Singapore Mediation Convention. This part will focus on other concerns relating to the interests of various bodies of China.

1. Concern over possible harm to the interest of Chinese companies

In recent years, the number of cross-border disputes involving Chinese companies has been on the rise. There are therefore concerns that if China becomes a contracting state of the Singapore Mediation Convention, this might result in opening the gate for enforcing the properties of Chinese companies[fn]For example, the court may seal up, seize or freeze the bank account or equity interest of Chinese companies, or may auction the real estate owned by Chinese companies in order to pay oﬀ the debt.[/fn] and jeopardizing their interests.

Response:

As already discussed above, the fundamental principle for developing a legal system should be fairness rather than showing favoritism to a certain group. If there are justiﬁable grounds to enforce the properties of certain Chinese companies, we shall not grant special protections to them. In fact, by reference to the New York Convention, the Singapore Mediation Convention has provided a self-contained and highly pragmatic defense mechanism that the enforcement debtor can avail itself of to raise objections.

In addition, if China does not sign the Convention, foreign companies would not be incentivized to use mediation to resolve their disputes with Chinese companies, and would have to resort to litigation or arbitration. Litigation or arbitration proceedings are time-consuming and costly, and their outcome is uncontrollable. By contrast, mediation enables the parties to cost-eﬀectively reach a solution that reﬂects their consensus, which is controllable and predictable.

Further, as far as a country is concerned, convenient conditions for dispute resolution is a strong indicator of its benign and open business environment. It can be foreseen that in the future, whether a country is a contracting state of the Singapore Mediation Convention will be an important index in valuing a country’s friendliness towards foreign investment, exactly as whether a country is a contracting state of the Washington Convention or the New York Convention now is. For China, being a contracting state of the Singapore Mediation Convention will not only help Chinese companies to expand their international businesses, but will further improve China’s investment environment and escalate its opening and reform.

2. Concern over the competition Chinese mediation institutions might face

Because the regulatory rules on mediation are unsophisticated and the practices of commercial mediation are inadequate in China, there are fears that China’s mediation institutions would be lacking a competitive advantage in the market for international mediation services in the event that the Singapore Mediation Convention enters into force in China.

Response:

If China signs and later ratiﬁes the Singapore Mediation Convention, certainly China’s mediation institutions will have to experience head-on competition with international mediation institutions. However, to cite Director Zhang Wei, “competition gives rise to development”. The competition brought about by the Singapore Mediation Convention is virtuous and interactive in that it creates opportunities for mediation institutions in diﬀerent countries to learn from each other. As a result, China’s mediation industry will gain in its international and professional strength. Moreover, China is endowed with a large number of highly competent legal professionals, a vast market as the second largest economy of the world, and the cultural tradition of valuing harmony. With those unique advantages, fears towards competition, if any, are completely unnecessary.

3. Concern over the adverse impact on Hong Kong’s position as an Asia-Paciﬁc Dispute Resolution Center

In the 13th Five-Year Plan for Economic and Social Development and the Development Plan for the Guangdong-Hong Kong-Macao Greater Bay Area, China’s central government explicitly pledged support for Hong Kong in its building of the Asia-Pacific Dispute Resolution Center. Hong Kong and Singapore are known to be competing for the dominant position in Asia-Pacific dispute resolution. Accordingly, some critics contend that if China signs the Singapore Mediation Convention, it would serve as an endorsement to Singapore and further enhance Singapore’s international competitiveness, which will have a negative impact on Hong Kong’s construction of the Asia-Pacific Dispute Resolution Center.

Response:

If China becomes one of the ﬁrst signatories of the Singapore Mediation Convention, this will be a landmark progress for the Convention, and will be conducive to its entering into force. However, it may be far-fetched to equal China’s signature with endorsement of Singapore’s role in the international legal market or a stepping stone for Singapore to compete with the Asia-Paciﬁc Dispute Resolution Center. The Singapore Mediation Convention will not be put aside because of the absence of China, while China will certainly miss out on a precious opportunity to improve its commercial mediation system. The commercial mediation practices and enforcement practices related to mediation will similarly miss the chance to catch up with international best practices.

As a matter of fact, on the issue of whether China should become a party to the Singapore Mediation Convention, Hong Kong’s fundamental interest lies in that China’s decision directly determines whether the Convention can be applied in Hong Kong.

In the past few years, the government of Hong Kong has been vigorously promoting the development of its mediation system. Most notable examples include the establishment of the Hong Kong Mediation Accreditation Association Limited in 2012, the coming into effect of the Hong Kong Mediation Ordinance in 2013 and the subsequent promulgation of the Practice Direction on Mediation (Hong Kong’s Practice Direction 31). At the same time, the mediation institutions in Hong Kong have accumulated abundant practical experience. On 17 April 2019, the International Dispute Resolution Conference co-organized by UNCITRAL, Hong Kong Mediation Center and the Department of Justice of Hong Kong took place in Hong Kong. One of the two major topics of the conference was the impact of the Singapore Mediation Convention on the international business environment. The conference gathered over 900 government officials, scholars, legal practitioners and entrepreneurs, which testified to the high-level attention paid by the Hong Kong Government and its legal profession to the Singapore Mediation Convention. If China becomes a contracting state of the Singapore Mediation Convention, this will help bring the superiority of Hong Kong’s mediation system into full play in the international arena and further enhance its international competitiveness. In contrast, if China does not sign the Singapore Mediation Convention, it would not be possible for Hong Kong to fully enjoy the benefits of the Convention. Worse still, Hong Kong’s role in the Asia-Pacific dispute resolution market is likely to be subordinated.

Conclusion:

The Singapore Mediation Convention is a milestone in the development of international mediation and will exert a huge impact on international dispute resolution. Being a contracting state of the Singapore Mediation Convention will help improve the business environment of China and present its opening-up image. Although China is experiencing problems such as a lack of commercial mediation legislation and inadequate commercial mediation practice, those issues should not be grounds for China to hold back from the Convention. Instead, China should seize the opportunity created by the Singapore Mediation Convention to improve its commercial mediation system, and to contribute to the construction of a diversiﬁed dispute resolution mechanism in the context of the “Belt and Road”.

Singapore Convention Series – Why China Should Sign the Singapore Mediation Convention: Response to Concerns (Part I)

Kluwer Mediation Blog October 16, 2019

Ting-Kwok IU (Kwok, Ng & Chan, Solicitors & Notaries)

On 20 December 2018, the 73rd session of the UN General Assembly (UNGA) in New York passed a resolution to adopt the UN Convention on International Settlement Agreements Resulting from Mediation (“the Singapore Mediation Convention” or “the Convention”) passed by the United Nations Commission on International Trade Law (UNCITRAL). The UNGA also agreed that the signing ceremony be held in Singapore on 7 August 2019. As the ceremony draws near, a heated debate was invoked on whether China should sign the Singapore Mediation Convention. This article is comprised of two parts. The ﬁrst part will introduce concerns relating to China’s legal and judicial system and provide responses to each of them from my perspective. The second part will cover other concerns relating to the interests of various bodies of China.

Concerns relating to China’s legal and judicial system

1. Concern over the compatibility between China’s legal system and the Singapore Mediation Convention

This concern is mainly reﬂected in the following three aspects:

Firstly, China lacks the legislation on commercial mediation. Commercial mediation is an independent means of dispute resolution and regulated by laws in many jurisdictions today[fn]E.g. the Mediation Ordinance of Hong Kong, the Singapore Mediation Act.[/fn]. In contrast, there is no specialized law on commercial mediation in China. As a result, a lot of fundamental issues in commercial mediation such as the qualiﬁcation of mediators and the conﬁdentiality of mediation are not ascertained by laws. If China rushes to sign the Convention at this point of time, this might aggravate the lack of normalization in mediation procedures. Secondly, recognition is a pre-step to enforcement of foreign court judgments and foreign arbitral awards in China. However, the mechanism of direct enforcement adopted by the Singapore Mediation Convention bypasses the recognition procedure and lacks legal basis under laws in China. Therefore, China must amend its Civil Procedure Law and other relevant laws in order to establish a supporting mechanism for the implementation of the Convention prior to consider signing the Convention.

Finally, under China’s existing mechanism for the enforcement of settlement agreements resulting from mediation (“Settlement Agreements”), a Settlement Agreement should firstly be confirmed by the courts at the joint request of the parties before it can be relied on by a party for enforcement. This mechanism contradicts the direct enforcement mechanism created by the Singapore Mediation Convention. Provided that the Singapore Mediation Convention enters into force in China in the future, conflicts may arise in the application of the two mechanisms.

Response:

Admittedly, the lack of commercial mediation law poses a major challenge for China to sign the Singapore Mediation Convention. But it is in China’s best interest to tackle this problem sooner rather than later.

Firstly, the People’s Mediation Law which was adopted in 2010 as China’s first legislation on mediation has actually hindered the development of commercial mediation in China. A good case in point is that Article 7 of the People’s Mediation Law stipulates that “people’s mediation commissions are organizations for the mass people and was set up in accordance with the law to mediate neighborhood disputes.” Accordingly, the people’s mediation is positioned as a form of community and neighborhood mediation with semi-official and non-professional features, which stands in contrast to the core values of commercial mediation—independence and professionalism. Moreover, Article 4 of the People’s Mediation Law provides that people’s mediation commissions may not charge any fees for providing mediation services. This is tantamount to strangling the financial supplies of people’s mediation and has curbed the motivation for mediators, resulting in an impediment to the establishment of a team of professional mediators. Therefore, the legislature needs to accelerate its efforts to enact a specialized law on commercial mediation and to promote mediation as an independent and professional career.

Secondly, in the legislative plan of the 13th Standing Committee of National People’s Congress (NPC) issued in September 2018, there was no mention of mediation-related laws. As the task list for the legislative work of the NPC, the legislative plan indicates the focus of the legislative work in the next ﬁve years. Thus, the enactment of commercial mediation law and reform of the mediation system is not on China’s agenda for the near future. Signing the Singapore Mediation Convention will help set a countdown for the enactment of a commercial mediation law. Otherwise, a commercial mediation law may still not be in the horizon.

In conclusion, there is indeed incompatibility between the current legal system of China and the Singapore Mediation Convention, but it should not be a ground to not sign the Convention. Instead, China should seize this opportunity to accelerate the enactment of a commercial mediation law and to catch up with other countries in the development of commercial mediation. A viable approach is for China to ﬁrst sign the Convention, followed by amendments to its domestic legal systems to ensure compatibility with the Convention, after which China may ratify the Convention. Signing the Singapore Mediation Convention will push the legislature to put the enactment of commercial mediation law on the agenda and will help pave the way for the development of commercial mediation in China.

2. Concern over disturbance to the judicial system of China

Because there is no reciprocal reservation in the Singapore Mediation Convention, some commentators worry that if China becomes a contracting state of the Convention, parties from non-contracting states would be able to apply for enforcement of Settlement Agreements in China, but Chinese parties would not be able to do so in non-contracting states. Consequently, some countries may take advantage of China’s judicial proceedings. Further, if China becomes a contracting state of the Convention, the people’s courts may be ﬂooded with cases on the enforcement of Settlement Agreements, which may lead to a shortage of judicial resources. Besides, the phenomenon of fraudulent litigation and fraudulent arbitration also exist in China. Because the Singapore Mediation Convention enables a party to directly apply for enforcement of a Settlement Agreement in any contracting state of the Convention, some people are concerned that once China becomes a contracting state of the Convention, fraudulent mediation might also emerge if there is no regulation or control in place.

Response:

Firstly, regarding the lack of reciprocal reservation, because the Singapore Mediation Convention does not introduce the concept of “place of mediation” similar to “place of arbitration”, nor does it deﬁne the nationality of a Settlement Agreement, there is no such thing as the Settlement Agreement of a contracting state or of a non-contracting state. Therefore, no reciprocal arrangements can be made and the Singapore Mediation Convention intends to beneﬁt all countries rather than being limited to its contracting states.

As the world’s second largest economy and a responsible country, China should orient the development of its institutions towards establishing a fair legal system, which demonstrates its core value of “building a community with a shared future for the mankind”, and should never put its own interest ﬁrst and partially protect its state-owned enterprises under the notion of nationalism. Legal professionals who are constantly calculating and concerned about being taken advantage of appear to have overlooked that the priority for the legal profession is to create a fair legal system instead of protecting the interests of a certain group. For example, if a Chinese company concludes a settlement agreement with a foreign company, under which the Chinese company is obligated to pay a certain amount of money to the foreign company yet it refuses to perform such obligation, and the foreign company ﬁles a claim before a Chinese Court, requesting for relief, then the right thing to do for the Chinese court is to provide the foreign company with due judicial protection rather than hinderance to the remedy it deserves. The issue of whether the mechanism of the Singapore Mediation Convention is to China’s advantage should be examined from more profound perspectives.

Secondly, with respect to the possible explosion of cases relating to enforcement of Settlement Agreements in the people’s courts, according to Zhang Wei, Director of the Shanghai Commercial Mediation Center (SCMC), in the hundreds of cases mediated by SCMC since its establishment where the parties reached settlement, all of the settlement agreements have been voluntarily complied with, without a single one being submitted to the people’s court for mandatory enforcement. We also heard from JAMS on the scarcity of occasions where the parties failed to perform the settlement agreements. In addition, we know from the Singapore International Mediation Center (SIMC) that in all the cases where settlement was reached since its establishment in 2014, the settlement agreements were all complied with and there has been no record of seeking judicial conﬁrmation of the settlement agreement yet. As Zhang Wei explains, commercial mediation is a dispute resolution method aiming at maximizing the parties’ interest under the assistance of professional mediators. Therefore, generally the parties will voluntarily perform the settlement agreement. In view of the above, we anticipate that if China becomes a contracting state of the Singapore Mediation Convention, mediation as a means of alternative dispute resolution will play an increasingly important role in alleviating the burden of Chinese courts, and lead to more eﬀective and appropriate use of judicial resources.

Thirdly, the concerns over fraudulent mediation can be addressed from the following three aspects. To begin with, like the way fraudulent litigation/arbitration is treated, the right attitude towards fraudulent mediation should be ﬁnding pertinent solutions. We do not ban litigation/arbitration due to the fear of fraud. Furthermore, the more developed China’s mediation system is and the more mature the mediation industry becomes, the lower the rate of occurrence of fraudulent mediation would be. Professional mediators are more than able to discover fraudulent mediation in the same way as judges are with respect to fraud litigation. In order to establish a sound and independent commercial mediation system and to build a team of high-calibre mediators, we need to make active use of the Singapore Mediation Convention instead of abandoning it in whole in order to avoid fraudulent mediation.

Finally, China is fully capable of regulating fraudulent mediation. For one thing, by reference to Article 227 of the Civil Procedure Law, if a third party finds that the Settlement Agreement was reached through fraudulent mediation and has injured its legitimate rights, it can file an objection to the enforcement before the people’s courts. For another, the behavior of seeking enforcement of the Settlement Agreement resulting from fraudulent mediation should be identified as “obstructing the judicial order or seriously infringing on the legitimate rights and interests of others”, and criminal punishment be applied according to the provisions on fraudulent litigation in the Criminal Law. To conclude, fraudulent mediation and false litigation have existed for a long time, yet they do not frequently occur, which would by no means warrant rejection of an advanced system or refusing to sign the Convention.

As a conclusion, the concerns over the legal and judicial system should not be obstacles for China to sign the Singapore Mediation Convention but should be regarded as an opportunity for China to establish a uniﬁed commercial mediation system. For other concerns and responses relating to the interests of various bodies of China, please refer to Part II of this article which will be published tomorrow.

A Trip to the World of Tourism!

Kluwer Mediation Blog October 16, 2019

Ting-Kwok IU (Kwok, Ng & Chan, Solicitors & Notaries)

I owe my recent participation in a very challenging project to my dear friend and mediation partner, Constança Madureira. For some time, she has been able to build a career as a lawyer and associate it with an extensive and respected professional background in the hotel and lodging industry. Having worked in top executive positions for renowned international hotel companies, she qualiﬁes as an expert on the subject matter.

Moreover, once mediation became a part of Constança’s continuous education in the last few years, she was able to identify several advantages and positive impacts of alternative dispute resolution. With that in mind, she extended me the invitation to join her in a dispute system design for a Brazilian hotel.

As I learned from Constança, the ﬁrst thing that comes to people’s mind when they think about Tourism is the lay representation of its tangible products: the hotel, the airplane, the trip, local attractions, and other associated images. However, technically and truly speaking, it is much more than this. Tourism is complex and this complexity derives from the ongoing growth of tourism ﬂows in today’s global context.

At the same time, Tourism is associated with socioeconomic and sustainable development. Compared to other strategic economic activities, Tourism is one of the fastest growing industries in the world, in some cases, topping oil exports, the food industry and automobile industry.

In short, from a pragmatic standpoint, Tourism is a relevant factor to promote the productive chain of all sectors that benefit from the increase in travelers’ flows. On the other hand, by its nature, Tourism is a key element to promote social inclusion, or rather, considering its best practices, it is an efficient and democratic tool to allow generation of income, employment, knowledge, and access to citizenship.

A deep immersion in the hotel project led us to an inevitable conclusion simultaneously. We had been dealing with inherent conflicts to any hotel operation, nonetheless, we envisioned the possibility of extending alternative dispute resolution tools to other players in the Tourism industry. Two possible scenarios came up then taking into consideration the conflicts specific nature and the improvement in relationships through consensus building and positive attitude/dialogue. Online Dispute Resolution Tools

Automated negotiations can be a fast, cheap, reliable, eﬃcient and modern way to deal with hotels everyday situations such as guest complaints and feedback, misleading or fake advertising, unauthorized payments, price discrepancies, service delays or failures, reservations (overbooking, cancellation, online travel agencies – OTAs), communication cultural barriers, luggage liability (loss, damage), suppliers defaulting. That said, we believe that ODR can be a very eﬀective tool to manage less complex, day-to-day disputes in a hotel.

Alternative Dispute Resolution Tools

In general, ADR applies to every stage of a hotel project – planning/feasibility, implementation/operation and closing.

We also agree that ADR is a most valuable tool when infrastructure implementation is concerned. Even though the Brazilian present legal framework is very favorable and friendly to the development of sustainable tourism in protected areas (like parks), several obstacles persist, including: a) park administration – hostile attitudes of managers and employees, resistance to partnerships with private sector, b) inadequate or outdated management plans – due to the absence of a combined system of protected areas governance and financing, lack of knowledge of priorities, lack of expertise of the public sector to establish realistic tourism management criteria, c) communication problems – the need to promote dialogue facilitation and consensus building, d) training and capacity building – understaffing, poorly trained managers, employees, e) excessive bureaucracy and delays in licensing due to jurisdiction overlaps of the public agencies involved, f) loss of significant revenues and insufficient or misdirected public and private investments, g) exclusion of traditional groups/communities in the implementation and operation of the projects, h) infrastructure – absence or lack of adequate infrastructure to the project feasibility.

Problems and impasses of such nature have led to setbacks in tourism development in Brazilian protected areas. Many projects have been unﬁnished, interrupted or even canceled due to their usefulness and inadequacy to public policies for the development of sustainable tourism in protected areas.

In this sense, we believe that ADR, including collective/multiparty mediation can be used to prevent or mitigate conﬂicts inherent to sustainable tourism development in the context of protected area management culture and practice. Also, the adoption of ADR can serve as a gateway to the Brazilian market where there is a shortage of tourism experts – not limited to protected area tourism management professionals – with ADR know-how.

Finally, thanks Constança, for taking me along on this a fantastic trip to the world of Tourism!

DanShaRi – A Modern Decluttering Philosophy That Mediators May Find Interesting

Kluwer Mediation Blog October 16, 2019

Ting-Kwok IU (Kwok, Ng & Chan, Solicitors & Notaries)

The Japan International Mediation Center in Kyoto (JIMC-Kyoto), which is the ﬁrst Japanese international mediation centre, was oﬃcially launched on 20 November 2018. The centre has a panel of non-resident international mediators. Kyoto, the former Imperial capital of Japan, is a city rich in culture. As one of the non- resident mediators, I am interested to know more about Japan, the people and its culture. Below is a short sharing that I have prepared after reading some materials on DanShaRi.

Dan-Sha-Ri, the philosophy of decluttering is an idea advocated by Hideko Yamashita, author of the bestselling book DanShaRi. Hideko Yamashita introduces herself in her book as the ﬁrst clutter management consultant in the world.

So, what is DanShaRi and how is it relevant to mediation practice?

DanShaRi comprises three themes: – Dan – refuse the unnecessary items to enter into one’s living space; Sha – throw away the endless garbage derived from the household items; and Ri – stay away from the obsession of keeping the unused items at home.

On the face of it, DanShaRi seems to be a way of helping people tidy up items around them by going through a process of making decisions on what should be kept and what should be abandoned. From another perspective, it appears to be advocating minimalism.

DanShaRi, in fact, has a much deeper sense. It is a thinking process of reviewing the relationship between the items and the person (but not the relationship between such items with other people) at the present moment (rather than in the past or the future). If one thinks that it is sad to throw something away and thus keep it, the focus is on that something rather than the person. According to Hideko Yamashita, the real spirit of DanShaRi is not only to help people declutter the room but it also helps them understand themselves better and deeper. Hence, the proper question to be asked is “whether the relationship between the items and me still exists”. If not, one should part with them. Keeping the clothes that we wore 10 years ago would not free up the space for new clothes or space for other purposes.

In the context of dispute resolution, a mediator may make use of the philosophy of DanShaRi to help a disputant review the relationship that he has with the disputes as well as the related litigation at the present moment. What should we do when a legal action has been initiated but it has been put on hold for some time? What should we do when a legal action has been initiated but it has been dragging on for years with all sorts of interlocutory proceedings and incidental appeals? As a mediation practitioner, I always ask the parties whether they enjoy the disputes and the related litigation. The usual answer is “No” with the explanation that they thought litigation would be the way to resolve the disputes. I also ask them what they will do with a household item bought for a reason but the item in fact is not as useful as expected. Should the item be kept? When a disputant is tired of litigation or when he is aware that the litigation does not help in the way as expected, his attitude towards the disputes and the related litigation will be diﬀerent. He will be more ready to take part in the mediation with a view to decluttering the legal action, reaching a settlement and/or redeﬁning the relationship.

Family mediators could also make use of DanShaRi to coach divorcing parties who are emotionally stuck with the shattered relationship, the financial dispute and issues relating to their children to move on and redefine their relationship. If a divorcing party is still at the stage of denial and anger, it is unlikely that the party will be emotionally and psychologically prepared for the mediation process because he/she either is still hopeful about the relationship or is still too angry to negotiate. It is only when both parties accept the fact that the marriage relationship has come to an end emotionally and sociologically, they will then be ready to end it legally by thereafter making the best use of mediation to declutter issues arising out of the closure of the relationship. By explaining to the parties that they can choose to refuse litigation entering into their lives, let go of the unhappiness derived from the marriage and stay away from the obsession of obtaining a favourable judgment from the court, the mediator may in effect inject the philosophy of DanShaRi to the parties so as to facilitate them to be more ready to go through the mediation process.

Although Albert Einstein once asked “if a cluttered desk is a sign of a cluttered mind, of what, then, an empty desk a sign?”, modern psychologists seem to suggest otherwise – clutter breeds stress. Mediators, to some extent, are like clutter management consultants. In the process of mediation, mediators use questioning, listening, summarizing, reframing, reality-testing and other skills to facilitate the disputants to understand their needs, concerns and fears (collectively “interests”) behind their positions, generate options to address the interests and understand their BATNA/WATNA. Mediators are in substance helping the disputants understand themselves better and deeper. The shift of a mindset on the part of the disputants is quite often a by-product of the process which leads to a settlement. Each party, through the mediation process, should be able to review one’s relationship with the dispute and with the other party. With the self-determination principle, each party may decide the way forward as to whether the dispute should be abandoned and parted with by way of a settlement and how to do it.

Fans of William Ury and readers of his book “Getting To Yes with Yourself” will probably remember Ury’s description about his involvement in the dispute between Abilio Diniz, a highly successful and prominent businessman from Brazil and his French business partner. The Financial Times described the dispute as “one of the biggest cross-continental boardroom showdowns in history.” During the mediation, Ury asked Abilio what he really wanted. In addition to getting a list of things that Abilio would like to have, Ury noticed that Abilio wanted to have freedom and his partner also wanted to run the company freely. Eventually, the settlement, amongst other things, was that Abilio was released from a 3-year non-compete clause and at the same time he agreed to leave the board. Ury, though without him knowing, had assisted the parties to settle by using the core values of DanShaRi. Had the parties been obsessed with the dispute and the related litigation, they would not have let go of the hatred arising out of the dispute and thus would not have freed up suﬃcient mental and psychological space for Abilio to move on with his freedom to do other things upon departure from the company and for the French businessman to run the company without intervention.

With the philosophy of DanShaRi in mind, mediators would be in a better position to assist the parties not to cling to something simply because they have spent a lot of time and money on it.