The Other Mechanisms: Good Offices, Conciliation, Mediation and Arbitration

In one line

Besides the panel route, the Understanding offers good offices, conciliation, mediation and arbitration, all voluntary, all confidential, and all available at any time.

In exam wording: apart from the panel and appellate procedure, the Dispute Settlement Understanding provides for consultations under Article 4, good offices, conciliation and mediation under Article 5, and arbitration under Article 25, to which must be added the arbitration on the reasonable period of time under Article 21.3(c), the arbitration on the level of suspension under Article 22.6, and the Multi-Party Interim Appeal Arbitration Arrangement of 2020.

Why there are other mechanisms at all

Article 3.7 states the preference. The aim of the mechanism is to secure a positive solution to a dispute, and a solution mutually acceptable to the parties and consistent with the covered agreements is clearly to be preferred.

So litigation is the fallback, not the object. Everything in this chapter exists because the Understanding would rather the parties settled.

Consultations, Article 4

The first mechanism and the most used. Every complaint must begin here, and a large proportion of matters never go further.

Article 4.3: the respondent shall reply to the request within ten days and enter into consultations in good faith within thirty days, with a view to reaching a mutually satisfactory solution. If it does not, the complainant may proceed directly to request a panel.

Article 4.7: if consultations fail to settle the dispute within sixty days, the complainant may request a panel, and it may request one earlier if both parties jointly consider that consultations have failed.

Article 4.10 requires special attention to the particular problems and interests of developing country Members.

Article 4.6: consultations are confidential and without prejudice to the rights of either party in further proceedings.

Good offices, conciliation and mediation, Article 5

One article, three procedures, and the Understanding does not define them. The distinction is one of degree, and a candidate should give it in these terms.

Good offices is a third party providing the channel and the venue so the parties can talk, without entering the substance.

Conciliation is a third party taking part in the discussions and helping the parties understand each other's positions.

Mediation is a third party going further and proposing terms of settlement, which the parties remain free to reject.

Article 5.1: all three are procedures that are undertaken voluntarily if the parties to the dispute so agree.

Article 5.2: proceedings, and in particular positions taken by the parties during them, shall be confidential, and without prejudice to the rights of either party in any further proceedings.

Article 5.3: they may be requested at any time by any party, may begin at any time and be terminated at any time. Once terminated, the complaining party may proceed with a request for a panel.