Double taxation imposes a significant barrier to global trade and investment. Traditionally, bilateral tax treaties (of which Australia has concluded more than 40) have attempted to eliminate double taxation, but disputes often arise about how these treaties should be interpreted and applied.

International organisations such as the OECD have sought to encourage the use of mandatory arbitration clauses to resolve these matters. However, this move has met with significant resistance from member nations.

In a recent post at austaxpolicy.com, Michelle Markham explores the reasons for this resistance and argues that arbitration of international tax disputes presents significant advantages to both governments and taxpayers.

Read the full post here: http://www.austaxpolicy.com/recurring-resistance-tax-treaty-arbitration-dispute-resolution-mechanism/

UIA ADR conference participants

Singapore is a great place for a holiday.

It is also a great place to learn lessons that would be very valuable for our economy in general- and our dispute resolution community in particular.

The opening session of the 24th UIA World Congress of Mediation in Singapore has given us a great snapshot of what collaboration achieves.

The big picture is enlightening. Statistics demonstrate that the economic gravity of the world is shifting rapidly to Asia which now accounts for 40% of global GDP.

The growth of Asian economies has been accompanied by a growth in the number of disputes and the Singapore Government has seen this as a commercial opportunity. It set out to create Singapore as the standout arbitration hub in Asia. Its active involvement and support has seen Singapore emerge as the third busiest arbitration centre in the world.

Through the collaborative work of its dispute resolution institutions the Singapore Government has, since 2014, broadened its sponsorship, and has moved from a focus on arbitration to a focus on dispute resolution which embraces arbitration and mediation. The aspiration is to promote Asian voices in global conversations.

A remarkable element of the strength of the mediation focus has been the commitment to collaboration and interconnectedness demonstrated by the 4 key institutional pillars:

• Singapore International Mediation Centre (SIMC)
• Singapore International Dispute Resolution Academy (SIDRA)
• Singapore International Mediation Institute (SIMI) and
• Singapore Mediation Centre (SMC)

The Court has added consistent support and leadership and through the combined efforts of the government and institutions there have been some significant achievements. A few examples are:

• Tax exemptions for non-resident mediators
• Collaboration between SIMC and SIAC (the Singapore International Arbitration Centre) to offer a one stop shop solutions via arb-med-arb. This provides reassurance about enforcement of agreements via access to the New York Convention
• A link to China’s Belt and Road initiative to help businesses resolve disputes
• SIMC’s mediation panel of 70 international mediators demonstrating significant international reach and credibility which sits alongside its panel of technical experts available to parties
• Ongoing thought leadership projects investigating what’s next in the field – issues such as systems thinking and online dispute resolution

Slide presented at the 24th UIA World Mediation Forum Singapore, October 2017 by Associate Professor Joel Lee of the National University of Singapore

The achievements are remarkable. The Dispute Resolution landscape in Australia would be transformed if we could achieve the same level of collaboration.

However, despite the collaboration and the investment some things are yet to be achieved. Currently mediation is the full-time day job of only one person in Singapore. Whilst there are many more full-time mediators in Australia, the situations in our 2 jurisdictions are very similar with regard to the failure to create a substantial profession of full-time mediators. The number of trained mediators in Australia far exceeds the available work.

This remains as significant a challenge in Singapore as it is in Australia.

This post previews Rachael Field and Jonathan Crowe’s forthcoming book, Mediation Ethics: From Theory to Practice, to be published next year by Edward Elgar. The book analyses the shortcomings of current neutrality-centred approaches to mediation ethics and seeks to answer the question of what might replace them.

Mediation is becoming more and more prominent internationally as a key form of dispute resolution for legal and other disputes. In some jurisdictions, participating in mediation is a compulsory pre-filing requirement in particular kinds of legal matters. Many benefits have been claimed for mediation as a mode of resolving disputes, including its informality, flexibility, less adversarial nature and focus on the parties and their interests. The growth of this form of dispute resolution has produced a considerable academic literature, but the theoretical foundations of mediation ethics have been relatively neglected.

Discussions of mediation ethics have traditionally focused heavily on the notions of mediator neutrality or impartiality. However, this focus has been criticised in recent decades for being unrealistic and overlooking the power dynamics between the parties. There is now a significant body of academic literature questioning whether mediators can ever truly be neutral and asking whether the concept of neutrality serves to mask the mediator’s actual power and influence. A number of authors have argued that it can be beneficial for vulnerable parties if mediators are prepared to play a more proactive role in appropriate cases.

The centrality of neutrality in mediation ethics, then, has increasingly been questioned and undermined. There is, however, a lack of consensus on what should replace it. The question is pressing given both the increasing reliance on mediation by domestic legal systems and a growing perception of mediation as an emerging profession. A traditional hallmark of a profession is its ability to self-regulate by applying communal standards of conduct. The idea of mediation as a profession therefore requires the mediation community to be able to articulate its core ethical standards. What, then, comes after neutrality? Can the concept be modified in response to these concerns or should mediation ethics have a different focus?

The present book offers a response to these questions. It develops a new theory of mediation ethics that emphasises the nature of mediation as a relational process. We argue that the focus of mediation ethics should move away from the untenable notions of neutrality and impartiality and towards a focus on enabling party self-determination. We supplement this focus with a view of mediation ethics as emerging dynamically from the efforts of mediators to respond to the needs of the parties. This provides the basis for a new picture of the mediation community as a community of practice with its own internal standards of excellence. We build on this theory to present a vision of what it means to think about mediation as a profession.

Chapter 1 opens the book by introducing the current paradigm of mediation practice, discussing the most commonly employed models of mediation and the extent to which they assume mediator neutrality or impartiality. Chapter 2 gives an overview of the historical development of codes of meditator conduct in the United States and elsewhere, showing how the facilitative model of mediation, with its ideals of neutrality and party self-determination, serves as an implicit yardstick for many forms of mediation practice. Chapter 3 then discusses the ideals of neutrality and party self-determination in more detail, examining how these notions are understood in the mediation literature, and considering the interaction between them.

Chapter 4 critically examines the notion of mediator neutrality, concluding that the dominant neutrality-centred approach to mediator ethics is at odds with the realities of mediation practice and is therefore untenable. In particular, the demands of neutrality place mediators in a position where they are unable to respond to the needs of individual parties without stepping outside the ethical boundaries of their role. Chapter 5 further problematises existing approaches to mediation ethics by considering the ways in which the relative informality of mediation may disadvantage inexperienced or vulnerable participants by requiring them to negotiate an unfamiliar genre of discourse. This provides the springboard for the new model of mediation ethics outlined in the subsequent chapters.

Chapter 6 introduces a new framework for mediation ethics that abandons the traditional emphasis on neutrality in favour of a focus on supporting party self-determination. The primary role of party self-determination in this new framework is supported by a focus on informed consent and an ethos of professionalism. Chapter 7 further operationalises this new ethical framework by offering a series of ethical guidelines that mediators can use to apply the framework in their practice. We argue for a contextual and relational conception of mediation ethics that is not rule-oriented, but encourages mediators to form appropriate and considered judgments in response to ethical challenges.

Chapter 8 then builds on this ethical framework to advance a conception of mediation as a professional community. We argue that mediation ethics is best understood as an evolving body of standards emerging over time by a process of consensus, rather than a set of rules or principles imposed from above. This picture of ethics is well suited to mediation due to its relationality and focus on the parties and their interests. The key feature of mediation, on this view, is not that the mediator is neutral or impartial, but rather that the parties are supported to achieve genuinely self-determined outcomes. This offers a more tenable basis for mediation ethics than the traditional emphasis on neutrality.

Readers of this blog may be interested in The “More Perfect” podcast series and a particular episode on reconciliation and apology. This was brought to our attention by Monash University academic and The Outer Sanctum podcaster extraodinaire, Dr Kate Seear.

The More Perfect podcast series (produced by Radiolab) has just returned for a second season. They examine important cases from the US Supreme Court and the first episode of the new series is about the Dredd Scott case, a case about slavery and citizenship.

It takes a bit of an unexpected turn, though, as it deals with issues about reconciliation and apologies. Readers might  be interested in it from a dispute resolution or non-adversarial justice perspective, just because it raises some interesting questions about how to reconcile past wrongs (and whether this is possible).

The relevant episode is here, and it is called “American Pendulum 2”. It might be useful for teaching, too.

Alastair Nicholson, former Chief Justice of the Family Court of Australia, was interviewed on the ABC’s Lateline program last week. The interview focused on the Commonwealth government’s upcoming review of the family law system. It contains a number of comments relevant to the role of family mediation.

For example, Nicholson identifies the adversarial nature of litigation as one of the main challenges facing the family law process:

[W]e should be moving to a much more, a much less rather, adversarial system because it seems to me that the traditional adversary system is really not suited to family law … [M]uch of the proceedings in the court are adversarial and people who want to litigate, or are encouraged to litigate by some unscrupulous representation can actually jam the system.

Although Nicholson does not think it would be helpful to ‘get lawyers out of the system entirely’, he emphasises that more needs to be done to involve people in their own disputes and address power imbalances:

I mean, there are moments in cases where the adversarial system works, but usually there is an imbalance of power in family law cases. … It’s the people who have got the deep pockets that can afford the adversarial litigation but it just doesn’t work, I believe, in family situations.

A partial solution to these issues, Nicholson suggests, is to reform the court process to prevent aggressive questioning by perpetrators of family violence and encourage judges to play a more active role in prioritising children:

So, [in the German system] they get the children’s point of view right from the start and then the whole proceeding goes through, with social workers assisting … The fact is that I think it’s a much more responsive system than ours, and it is one that we could well copy.

Nicholson also recognises the important role of mediation, particularly in making the process less expensive for the parties:

[T]here is now much more room for mediation, which was a criticism of the system in the past. … [T]he other way to make it less expensive is to resolve the issues as soon as you can. … Once you start getting into litigation and once you start coming to court, it’s going to be expensive.

Family mediation has much to offer in addressing the problems of adversarialism and cost that Nicholson identifies, as well as managing power imbalances and helping to ensure a child-focused outlook. Hopefully, the government’s review of the family law system will acknowledge and support this potential.

The full interview can be accessed here: http://www.abc.net.au/lateline/interview:-alastair-nicholson,-former-family-court/8999010.

Australian Dispute Resolution Research Network members may be interested in this  upcoming seminar at Bond University’s Centre for Professional Legal Education on Thu. 19 October 2017 10:00 am – 4:00 pm

Bookings (free) made here. RSVP by 29 September 2017. Due to limited spaces, registration is essential.

Symposium: Law Without Lawyers?
19 October 10.00am-4.00pm, 

University Club Restaurant, Bond University, 14 University Drive, Robina, QLD 4229, View Map

It has been predicted that emergent technologies such as artificial intelligence, ‘lawbots’, smart contracts, automated dispute resolution services and the like will soon replace human lawyers in the delivery of some, most or even all legal services. How persuasive is this claim, and if it does have merit, what are the implications of ‘law without lawyers’ for the rule of law, for justice, for the community, and for law students and lawyers themselves?

Bond University’s Centre for Professional Legal Education (CPLE) will investigate these questions in a one day symposium titled ‘Law Without Lawyers?’. The symposium will explore in depth the likely impact of technological innovation on the practice of law, and the implications – both positive and negative – of the possibility that legal services will be delivered without the direct involvement of human lawyers. The symposium will include a keynote address, a panel discussion and debate, and an interactive workshop. Morning tea, lunch and afternoon tea will be provided.

Legal practitioners will be eligible to earn up to 3 CPD points for their attendance at the symposium.

Bookings (free) made here. RSVP by 29 September 2017. Due to limited spaces, registration is essential.

On 18 October 2017, the United Nations Convention on Transparency in Treaty-based Investor-State Arbitration (New York, 2014) (the “Mauritius Convention on Transparency”) will enter into force.     Current signatories include Australia as well as many of Australia’s major European investment partners, as well as the United States.

What is the Mauritius Convention?

The Mauritius Convention, as its name suggests, is designed to ensure transparency in the investor-state arbitration process (not any other types of arbitration, such as international commercial arbitration).

The Convention (or more accurately, the UNICITRAL Rules adopted by the convention) is ground-breaking because it represents a major shift away from the traditional model of arbitration being a private, confidential process.    Like most forms of arbitration, investor-state arbitration has previously been undertaken predominately in private, with no guarantees of public access to information about the dispute, the arguments, or even the award and reasons.   While this may be understandable in the case of private arbitration between commercial parties, the nature of investor state arbitration is different.    Because of the nature of the dispute – a disagreement about the treatment of a foreign investor by a host state –  there are generally important issues of public policy at stake.

For example, many Australians first heard of investor-state arbitration following an ultimately unsuccessful claim against Australia by Philip Morris (Asia) via an investment agreement between Australia and Hong Kong, seeking compensation for the impact of  Australia’s plain label packaging laws.   In other cases, investor-state disputes have arisen as a result of environmental measures, public health measures, and even anti-discrimination provisions in post-Apartheid South Africa.   As a result, investor-state dispute resolution has received quite a lot of negative publicity, and many states are retreating from the system of investor-state arbitration by terminating international agreements.

The Convention operates by giving ‘teeth’ to the UNCITRAL Rules on Transparency in Treaty-based Investor-State Arbitration.  These Rules, although they do contain exceptions, provide three main types of transparency in arbitrations to which they apply:

• Open hearings:  Hearings are to be made public, with the arbitral tribunal to make arrangements to facilitate public access to hearings.
• Amicus curiae/third party submissions:  formalising  the right of arbitral tribunals to receive relevant amicus curiae and other third party submissions.
• Publication:  Submissions and awards must be made public.

When does it apply to Australia?

The entry into force of the Mauritius Convention has taken place pursuant to Article 9 of the Convention – six months after the ratification of three signatories.    However at the present time, the convention only applies to disputes between Canada, Mauritius and Switzerland.  In Australia, implementing legislation is currently before Parliament. However, in time, most signatories can be expected to complete the ratification process according to their domestic laws.  However even prior to ratification, parties to an Investor-State arbitration can still agree to the voluntary application of the provisions.

A Watershed for Arbitration?

To those used to the context of domestic litigation, these sound like trivial changes, but they represent a great leap forward for transparency in investor state dispute settlement.  Some commentators have even considered that the convention may  lead to a change of culture in relation to arbitration more broadly.

Image: Supreme People’s Court, China.  Image from Wikimedia Commons

Today’s post is a piece by Dr Bin Li,  a lecturer at Newcastle Law School Australia.

The large population of China presents unique challenges for access to justice.  With a population approaching 1.4 billion people, there are around 11.5 million civil cases per year, according to the statistics of the Supreme People’s Court of China (‘SPCC’).  [1]

The idea of diversified dispute resolution ( ‘DDR’) was first put forward in 2004 by the SPCC as part of a parcel of reforms designed to advance access to justice[2], with the SPCC urging lower-level Chinese courts (People’s Courts) to develop capacity in mediation and give greater recognition to arbitration.  Further, the Supreme People’s Court called for collaboration and joint development of the DDR model with other entities and organisations external to the people’s courts.

At the time of these announcements, the SPCC had not provided a clear definition of the concept of DDR.  This was subsequently articulated in 2014 by the Fourth Assembly of the Eighteenth Central Committee of China Community Party in its Decision concerning Some Major Questions in Comprehensively Moving Governing the Country According to the law Forward,.  In that document, the  DDR was defined as an organic and coordinated dispute resolution system comprising mediation, arbitration, administrative adjudication, administrative review, litigation and other processes.

Arguably, therefore, DDR has some similarities with the systems of alternative dispute resolution  as it used in Western courts, but also some significant differences.   They have in common the prominent use of mediation as key process, and recognition of the role of arbitration.  However, DDR has a more expansive definition in that it encompasses other dispute resolution processes, including administrative review; the second and a more significantly, is that DDR is intended to operate as a coordinated and court-controlled system.

Thus,  the creation of the  DDR system has become an integrated part of judicial reform in China and an important task for a range of Chinese government entities at provincial and national level, including administrative departments for justice of local governments, which  regulate  the system of people’s mediation[3], along with the Supreme People’s Court a nominated by the Chinese Communist Party to take the lead in this process.

From 2014 onwards, the SPCC has actively encouraged lower level people’s courts to speed up their development of the DDR system,  and People’s courts have responded with measures such as the implementation of mandatory mediation programs prior to disputes being admitted to the litigation process. This is a very encouraging news for mediation in China as in the past, people’s courts had only used mediation during the litigation process rather than prior to litigation. Now the practice is that before the dispute is accepted by people’s courts to litigation, the people’s courts will aim to solve it before proceeding to litigation.

To achieve such an aim, the people’s courts have established  Coordination Centres for Mediation and Litigation (“CCML”). During this pre-litigation mediation process, CCMLs usually invite people’s mediators to participate and help with the settlement, and when acting in this capacity, these mediators are known by a term that means ‘specially invited mediators’.  This distinction is interesting as  People’s mediation is separate from mediation provided by people’s courts during the litigation process and it is provided and undertaken by administrative units of departments for justice at provincial level. in .  Therefore, by inviting people’s mediators to the pre-litigation mediation process conducted by the CCML, the people’s courts have started to explore the way where mediation can be more utilised while the relationship between mediation and litigation can be carefully dealt with.

Challenges in Implementation

There are, however, some barriers for the people’s courts to get over in order that the completion of DDR can be achieved.

First and foremost, there is an absence of domestic legislation defining the leadership role of SPCC. The aspiration is to have As its definition suggests, the DDR is an organic system focusing on the coordination of various dispute resolution approaches. It is therefore important to have a lead agency to oversee and coordinate reforms. In this respect, though SPCC has been nominated by CCP to take the lead in the reform, there is no legislation confirming such a leading role taken by the SPCC. The subsequent problem would be how SPCC could smoothly coordinate the reform where the functions of government are involved, such as people’s mediation.

The second difficulty is related to the unsuccessful practice of people’s mediation. In China, people’s mediation is a process where a people’s mediation commission persuades the parties concerned to a dispute into reaching a mediation agreement on the basis of equal negotiation and free will and thus solves the dispute between them. Also, according to the law, Ministry of Justice is responsible for people’s mediation nationally, with provincial justice departments taking responsibility for guiding the people’s mediation within their respective administrative regions. The 2010 People’s Mediation Law was designed to make mediation a key process for the resolution of civil disputes, and to ameliorate the workload of the  people’s courts. However, evidence shows that people’s mediation has not worked as well as expected, which appear to be due to a range of factors, including the public having little interest and confidence in mediation.  For example, there is no accreditation system for people’s mediators whose quality therefore cannot be guaranteed. [4] In addition, one cultural factor possibly undermining the public’s confidence is that Chinese people would rather trust judges than the people’s mediators who they don’t know at all.

Thirdly, the use of CCMLs presents particular challenges. In people’s courts,  judge are usually involved by guiding the mediator’s work. However this involvement presents particular issues if the dispute is not resolved through mediation.

The first option would be for the judge involving in the previous mediation to hear and decide. In this case, it may be possible for the judge to exert pressure on the parties to settle their disputes in mediation. In addition, since the judge has already known the case, it is questionable whether that judge is still an appropriate person to try the case. The second option is that the dispute will be registered as a case and resolved by a different judge, which will then prolong the resolution of the dispute.

This piece has presented a short perspective of the opportunities and challenges in creating a DDR system in China.   There are interesting parallels between the experience in China, but also unique challenges.   In China, as elsewhere, the key to making this court-led system effective is to identify how the DDR can be effectively integrated into the workflow and procedures of already busy courts.  In this respect, a nationally accredited system for people’s mediators will help establish the confidence of the public. It is also vital for SPCC to lay down some specific rules on this court-led reform, such as whether the judge already involving in the pre-litigation mediation is still eligible for hearing the case provided that the dispute has not been resolved by mediation. A related question also needs to be answered being whether the information disclosed in mediation can be used in the subsequent litigation. So far people’s courts in different provinces could have different answers to these two questions and it is the right place for SPCC to step in.

[1] https://supremepeoplescourtmonitor.com/tag/china-court-statistics-2015/

[2] Notice of the Supreme People’s Court on Issuing the Second Five-Year Reform Outline for the People’s Courts (2004-2008).

[3]http://www.cspil.org/Uploadfiles/attachment/Laws%20and%20Regulations/[en]guojifalvwenjian/PeoplesMediationLawofthePeoplesRepublicofChina.pdf.

[4] Art. 14 of People’s Mediation Law only provides that the people’s mediators shall be adult citizens with ‘certain level of culture, policies and legal knowledge’.