The official signing ceremony today for the Convention on the Establishment of the International Organization for Mediation (IOMed) is a historic event for the Hong Kong Special Administrative Region and for international mediation.
The IOMed is the world’s first international intergovernmental legal organization dedicated to resolving international disputes by mediation in accordance with the principles set out in the United Nations Charter which provides for mediation as a key dispute settlement method. The scope of IOMed cases may involve disputes between states, disputes between a state and a national of another state, and international commercial disputes between private parties. The importance of IOMed is recognized by its status being equivalent to that of the International Court of Justice and the Permanent Court of Arbitration in The Hague.
The significance of the signing ceremony for the Convention on the IOMed is highlighted by the attendance of Foreign Minister Wang Yi, also a member of the Politburo, together with representatives from nearly 60 countries and regions (Asia, Africa, Latin America and Europe) and about 20 global organizations, including the UN itself. The global forum on international mediation that will follow the signing ceremony will provide a valuable opportunity for participants to share experiences and discuss mediation of disputes among states and mediation of international investment and commercial disputes.
This is also the first time that an international intergovernmental organization has had its headquarters in Hong Kong (although some have previously established regional centers). The establishment of the IOMed in the HKSAR emphasizes the importance the central government attaches to the city’s status as China’s only common law jurisdiction under the “one country, two systems” principle, the essential role of mediation as an amicable and collaborative way to resolve international disputes, and Hong Kong’s strengths as an international dispute-resolution center.
Hong Kong is already internationally recognized as one of the most popular places for international arbitration in the world (as most recently confirmed in a leading international survey). Arbitration is an adversarial form of dispute resolution where an arbitral tribunal makes a final and binding decision on the parties to the arbitration. There are cases where the parties need a binding arbitration decision given by a third-party arbitral tribunal that can be enforced internationally under the New York Convention.
Mediation has a long history in both Eastern and Western cultures. When compared with litigation and arbitration, mediation offers several advantages. It is generally faster and less expensive than litigation. While arbitration is also popular for its binding nature and international enforceability, it tends to be more formal and can be as costly and time-consuming as litigation. Mediation, on the other hand, allows parties to have more control over the dispute-resolution process and its outcome, fostering a collaborative environment for dispute resolution. In mediation, disputes can be resolved on a “win-win” basis in a simple, confidential and fast process by which parties voluntarily choose to reach agreement on their dispute with the assistance of an independent neutral person.
However, to date, mediation has not been commonly used for resolution of international disputes involving states (although it is provided as an option in many investment agreements and treaties). Key challenges to its use have included how a state’s officials may get authority to settle and the choice of mediators. The ways to address these challenges have included internal training; authorization letters/documents from the most senior levels of the governmental institution; statutory provision for immunity from suit of persons authorized to mediate; and discussion (socialization) of proposed settlement with all stakeholders and written confirmation of settlement terms at the most senior levels of the institution.
The establishment of the IOMed will provide an international intergovernmental organization that can offer suitable mediators and the framework for, and support of, mediation of disputes involving states, as well as of international disputes generally; and promote the use of mediation in dispute resolution, including to develop the culture of mediation, and to explore and promote best practices of mediation, among other activities.
Mediation can also be used with arbitration as well as litigation and other forms of dispute resolution such as expert determination and adjudication. As parties continue to seek fair, cost-effective, confidential and efficient dispute resolution, the IOMed should enhance the appeal of mediation of international disputes.
Hong Kong is already internationally recognized as one of the most popular places for international arbitration in the world (as most recently confirmed in a leading international survey).
The factors that have contributed to Hong Kong being so highly ranked as an international arbitration center will contribute to the city providing a similar quality of support to the IOMed in its provision of mediation services and related activities. These factors include Hong Kong’s common law system, with an independent judiciary and the rule of law, while being part of China; Hong Kong’s multilingual legal talent with broad expertise in different systems of law (common law, civil law and international law); the city’s regularly updated legal framework for dispute resolution which adopts best international practices tailored to its own needs; its role as an international commercial and finance hub; its role in research and funding of digital technology; and its geographical location.
That Hong Kong provides a welcoming, supportive and effective environment for international dispute-resolution centers is demonstrated by the number of major commercial dispute-resolution centers already located in Hong Kong. These include homegrown institutions, such as the Hong Kong International Arbitration Centre and the Hong Kong Mediation Centre, and international and cross-border institutions including the ICC International Court of Arbitration, the China International Economic and Trade Arbitration Commission Hong Kong Arbitration Center, the South China International Arbitration Center and the Shanghai International Arbitration (Hong Kong) Center. It is also demonstrated by the establishment of offices or operation of international intergovernmental organizations in Hong Kong.
Hong Kong has already made significant efforts to enhance its mediation services as part of its broader objective to strengthen its role as an international legal and dispute resolution hub. Stakeholders, including the Department of Justice, have been actively promoting mediation through various initiatives, including promoting the “mediate first” pledge and public education campaigns, to raise awareness. The HKSAR government is also exploring the establishment of a sports dispute-resolution system to leverage the institutional advantages of Hong Kong in dispute resolution.
The establishment of the IOMed is the beginning of a new era in the understanding and use of mediation in international dispute resolution. Hong Kong’s role as a bridge between Eastern and Western cultures and legal traditions should contribute to the effective work by the IOMed, while enhancing Hong Kong’s position as a leading international mediation center as well as an international arbitration and litigation center.
The author is a current council member of the Hong Kong Bar Association and the chair of its Arbitration Committee. She practices as an international arbitrator and barrister.
The views do not necessarily reflect those of China Daily.
