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.