10 Mediation in civil and commercial
matters
| (26068)
13852/04
+ ADD 1
COM(04) 718
| Draft Directive on certain aspects of mediation in civil and commercial matters
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| Legal base | Article 61(c) EC; co-decision; QMV
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| Department | Ministry of Justice
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| Basis of consideration | Minister's letter of 5 October 2007
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| Previous Committee Report | HC 41-xxiv (2006-07), para 8 (10 October 2007);
HC 41-xxi (2006-07), para 1, (9 May 2007);
HC 41-xvi (2006-07), para 3 (28 March 2007);
HC 34-xi (2005-06), para 2 (23 November 2005);
HC 34-x (2005-06), para 4 (16 November 2005);
HC 34-v (2005-06), para 10 (12 October 2005);
HC 38-ix (2004-05), para 2 (23 February 2005); and HC 38-i (2004-05), para 6 (1 December 2004)
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| To be discussed in Council | Justice and Home Affairs Council 8-9 November
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| Committee's assessment | Legally and politically important
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| Committee's decision | Cleared
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Background
10.1 We have considered this proposal on the mediation of civil
and commercial disputes on a number of occasions, most recently
on 10 October 2007. We agreed with the Minister about the benefits
of mediation and alternative dispute resolution, and noted that
the Council had agreed that proposals under Article 65 EC[27]
(of which this was one) should be limited to cross-border disputes.
10.2 We welcomed the progress which had been made
towards agreeing an acceptable form of restriction so as to ensure
that the Directive would not apply to mediations which were internal
to a Member State. We thought a definition based on the connecting
factor of domicile or habitual residence of the parties would
provide a clear and simple rule for the majority of cases and
would most closely respect the limits on EC action imposed by
Article 65 EC.
10.3 We noted from the Minister's letter of 5 October
(received by us on 12 October) that the Presidency had proposed
an alternative definition which would cause the Directive also
to apply where a mediation process had been initiated otherwise
than by agreement between the parties (Article 1a) and to an agreement
resulting from mediation between parties domiciled or resident
in the same Member State "if there is an effective need to
have such an agreement enforced in another Member State"
(Article 5). We considered that the amendment to Article 5 needed
to be approached with care, and that the concept of "an effective
need" in relation to enforcement needed to be explained.
We were concerned that the amendment could lead to the Directive
applying simply by reason of the location of assets in different
Member States, and we were not convinced that such an extension
of the scope of the Directive was desirable or warranted.
10.4 It was also proposed that the rule in Article
6 (which protects parties in the mediation process from being
compelled to give evidence in subsequent proceedings about information
disclosed in that process) should apply in respect of judicial
proceedings brought before a court of a Member State other than
that in which either party is domiciled or habitually resident.
We agreed that parties should not be disadvantaged in subsequent
proceedings by reason of any earlier willingness to engage in
mediation, and we were content with this amendment.
10.5 We agreed with the Minister's view that a similar
rule should apply to limitation periods under Article 7 so that
parties could engage in mediation with confidence that this would
not cause limitation periods to expire in other Member States
in any subsequent court proceedings.
The Minister's letter
10.6 In her letter of 5 October 2007 the Parliamentary
Under-Secretary of State at the Ministry of Justice (Bridget Prentice)
informs us of the state of negotiations and supplies us with a
copy of the latest version from the Presidency. The Minister explains
that the amendment to Article 1a has been maintained in the Presidency
draft, so that the Directive would apply also to cross-border
mediations which are ordered by a court, or where an obligation
to mediate arises under national law, or where a court has invited
the parties to mediate, in addition to those cases where the parties
agree to use mediation after their dispute has arisen.
10.7 The Minister further explains that the Presidency's
proposed amendment to Article 5 has not been adopted, but that
the amendment to Article 6 has been agreed, together with the
amendment to Article 7. The Minister explains that Article 7 has
been further amended so as to refer to arbitration. Although the
Directive does not apply to arbitration, the effect of the amendment
appears to be to protect parties to a mediation from being obliged
to give evidence in a subsequent arbitration in relation to information
which has been disclosed in the mediation process.
Conclusion
10.8 We thank the Minister for this further
information on progress.
10.9 We consider that the latest version addresses
the concerns we had, and we are therefore content to clear the
proposal from scrutiny.
27 Article 65 EC provides for the adoption of measures
in the field of judicial cooperation in civil matters 'having
cross-border implications and in so far as necessary for the
proper functioning of the internal market'. Back
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