ICSID - International Centre for Settlement of Investment Disputes

11/17/2023 | Press release | Distributed by Public on 11/17/2023 09:24

Key Differences between Mediation and Conciliation at ICSID

Key Differences between Mediation and Conciliation at ICSID

While the terms conciliation and mediation are sometimes used interchangeably in other contexts, at ICSID there are significant differences between these two processes. A few key distinctions are:

Scope of application

There are differences between the scope of application of ICSID conciliation (under the ICSID Convention or the Additional Facility) and ICSID mediation. Two distinct features of ICSID mediation are noteworthy (Mediation Rule 2(1)):

  • there is no foreign nationality requirement for parties in ICSID mediation, and therefore ICSID mediations may involve investors and nationals of the State party to the dispute
  • there is no requirement for either party to be linked to an ICSID Convention Member State in ICSID mediation.

Institution of mediation absent prior agreement

Under the ICSID Conciliation Rules (Convention and Additional Facility), a Request for conciliation may be submitted only once the disputing parties have consented to ICSID conciliation. By comparison, a Request for mediation may be submitted absent a prior written agreement to mediate and instead contain an offer to the other party to mediate the disputed issues (Mediation Rule 6). The Secretary-General will then transmit the offer to mediate to the other party, inviting that party to state whether it accepts or rejects the offer. If the offer is rejected or no response is received within 60 days, no further action will be taken on the Request; if the offer is accepted, the review of the Request for mediation will continue with the registration of the Request as the next step (Mediation Rule 7).

Unilateral withdrawal at any time - "Ongoing Consent"

Under Article 25(1) of the ICSID Convention, a party may not unilaterally withdraw from a conciliation once consent has been given. However, consent to mediate is required not only at the outset but also throughout the entire mediation procedure ("ongoing consent" to mediate), and either party is entitled to withdraw from the mediation at any time.

Number of mediators and method of their appointment

The ICSID Conciliation Rules (Convention and Additional Facility) envision the establishment of a conciliation commission, consisting of an uneven number of conciliators. The number of mediators and method of their appointment differs: the Mediation Rules envision that there will be one or two mediators who are appointed by party agreement (Mediation Rule 13(1)).

If the parties are unable to reach agreement on the number of mediators within 30 days of the registration of the Request for mediation, the default provision in the Mediation Rules envisions the appointment of one mediator by party agreement (Mediation Rule 13(2)).

Role of the mediator

The role of the mediator in ICSID mediation is limited to assisting the parties in reaching a mutually acceptable resolution of all or part of the issues in dispute (Mediation Rule 17), whereas in ICSID conciliation, the mandate of the conciliation commission is broader and includes an obligation to "clarify the issues in dispute." (Article 34 of the Convention, Conciliation Rule 24, Additional Facility Conciliation Rule 32).

For more information on the role of the mediator, parties and counsel, see ICSID's Background Paper on Investment Mediation.

No 'jurisdictional' determination by the mediator

In contrast with ICSID conciliation (under the Convention and Additional Facility), the mediator may not make a "jurisdictional" determination, which allows the parties and the mediator to focus on finding a resolution on the disputed issues.

Process

Mediation is a more informal process than conciliation. Unlike a conciliation commission, the mediator does not have the authority to issue formal orders or decisions.

Confidentiality

Information relating to a conciliation or a mediation and all documents generated in or obtained during the process are confidential, unless (i) the parties agree otherwise, (ii) the information or document is independently available, (iii) disclosure is required by law.

Absent party agreement, no information concerning the mediation will be published by ICSID (Mediation Administrative and Financial Regulation 3 and Mediation Rule 10(2)). However, the ICSID Convention Conciliation Rules and the Additional Facility Conciliation Rules require the Secretary-General to publish the names of the parties and basic case details on the ICSID website. (Mediation Administrative and Financial Regulation 3 and Mediation Rule 10(2)).

Mediation and conciliation at ICSID therefore differ significantly in terms of scope and process. By adding mediation to ICSID's dispute settlement offerings, the Centre provides the parties with a greater choice of dispute settlement procedures.