International trade is the main form of Ukraine’s foreign economic relations. We actively develop trade relations with countries of the European Union, the UK, China, the US, etc.
To perform foreign economic transactions is impossible without executing agreements. Since parties to agreements are carriers of different cultures, they can have different understandings of business processes. Due to this, conflicts and disputes often arise.
To resolve disputes arising in international trade, parties can resort to courts of arbitration. However, legal proceedings and arbitrations in international trade are associated with numerous difficulties.
The procedure for recognizing a decision issued by an international court is regulated by the laws of the country, in which such decision is to be enforced. And legal procedures associated with its recognition and enforcement can take a long time. In addition, litigation requires participation of foreign counsel, whose fees are difficult to assess in advance. Further, if an international dispute involves three or more parties, a formalized litigation process may not be used.
To resolve disputes in international practice, companies most often resort to mediation, which can be used both before litigating a case in court and concurrently with litigation. Mediation is an internationally accepted alternative way of dispute resolution, widely used in the US and the EU. Furthermore, back in 2001, the UK government obligated all state authorities to resort to peaceful conflict settlement before referring a case to court.
Using mediation in international trade has numerous advantages over litigation. Resolving a conflict in court is strictly regulated by procedural and time constraints. Mediation takes much less time, it takes place in convenient and comfortable conditions, and dispute resolution can take just several days.
In comparison with arbitration proceedings, mediation is a less expensive way of conflict resolution. A mediation procedure also helps partners to better understand each other’s cultural peculiarities, be guided by them in the future, and build a dialogue and a relationship.
To resolve disputes in international trade, foreign partners most often are focused on using specifically mediation. When any conflicts arise, our experts recommend clients working in international trade to seek help from a mediator who will help the parties reach agreement and conciliation.
Participants of foreign economic transactions can in advance agree to use mediation in case of conflict and can put it down in the body of the main agreement. When executing the agreement, parties can determine the procedure for selecting a mediator who will facilitate handling the dispute. In addition to the parties’ decision-makers, their attorneys can also participate in the mediation procedure.
We, mediators of the DecisionLab agency, provide professional consultations to companies working in international trade, through mediation help clients build strong relationship with partners, and if a conflict arises, reach conciliation and find a mutually beneficial solution to a problem.