Newly launched DIAC Mediation Rules: a catalyst for ADR evolution in MENA

The Dubai International Arbitration Centre (DIAC) is the region’s leading institution for alternative dispute resolution (ADR) services. Since its establishment in 1994, DIAC has garnered expertise in resolving thousands of high-value arbitration cases. In line with DIAC’s ongoing commitment to enhancing its ADR services, the newly released DIAC Mediation Rules of 2023 (Rules) pioneer evolution in the ADR landscape in the UAE and the broader region. These Rules introduce a structured mechanism for ADR in commercial settings, and offer the business community an invaluable framework for addressing disputes while simultaneously reducing the costs and risks associated with doing business.

The Rules came into force on 1 October 2023 and will apply to all new mediation requests submitted to DIAC from that date forward, ushering in an era of advanced mediation of disputes.

The Rules were originally drafted in English and have been translated into Arabic for broader accessibility and understanding.

The Rules govern the entire mediation process, ensuring clarity and certainty for all parties involved, spanning from the commencement (Article 3) to the conclusion of the mediation process (Article 8). They establish an infrastructure for critical aspects of the process, such as communication between the involved parties and the Dubai International Arbitration Centre, adherence to specific time limits (Articles 3 and 4), cost considerations (Article 5), the appointment of the mediator (Article 6), and the overall conduct of the mediation process (Article 7).

The Rules have been meticulously crafted to establish a robust institutional structure for mediation users, aligning with the highest global standards. Importantly, they also thoughtfully grant the parties a measure of flexibility to customize the Rules within the limit of their underlying principles (Article 2.4). This approach harmonizes with the voluntary nature of mediation, preserving the parties’ autonomy to shape the process and its ultimate outcome to better suit their unique needs and circumstances.

Confidentiality which is one of the pillars of the mediation process, and Article 9 of the Rules carefully covers all relevant confidentiality concerns. Confidentiality extends to various aspects of the mediation process, including all information and materials produced by any party or created for the purpose of mediation, unless otherwise agreed by the parties. Additionally, the contents and existence of any settlement agreement reached through mediation are also considered confidential, except when legal obligations or the necessity to enforce or challenge the agreement before a court require disclosure. Private communications made to the mediator remain private unless the disclosing party grants consent for sharing with the other party.

While the general law in the UAE does not acknowledge the concept of ‘without prejudice communications’ it has been officially instituted by the UAE legislator through Article 14 of the Mediation Law No. 6 of 2021 and is further detailed in Article 9 of the Rules. Any statements made during mediation, whether in written or oral form, are prohibited from being used as evidence of admissions against the party that made them in any judicial or arbitration proceedings. Lastly, the mediator may only disclose confidential information if compelled by law or a competent judicial authority. These provisions ensure that the mediation process maintains a high level of privacy and encourages open and candid discussions among the parties involved.

The Rules have an overarching objective of ensuring that every mediation process is conducted with fairness, impartiality, efficiency and proportionality. All parties involved, including the mediator and the representatives of the parties, pledge their commitment to upholding these standards (Article 2.5).

An established mediation framework marked by voluntary participation, impartiality, confidentiality, and enforceability serves as a cornerstone for instilling faith in the mediation process. These fundamental principles are indispensable, as they empower parties with the autonomy to opt for mediation, place their trust in the mediator’s neutrality, safeguard sensitive information, and assure the legitimacy of the process’s outcomes.

We are eagerly anticipating the evolution of the mediation landscape in the UAE and the surrounding jurisdictions and we look forward to collaborating with DIAC and other stakeholders in the market to support the UAE government’s vision of promoting mediation and its seamless integration into UAE legal system.

How can we help?

At Al Tamimi & Company we are committed to the use of mediation and other ADR procedures wherever this is in the best interests of our clients.

Our lawyers have extensive experience of successfully representing clients in mediations and ADR procedures across the MENA region and beyond.