Arbitration and mediation

If you and your debtor agree to an alternative dispute solution, there are two options available: arbitration and mediation or conciliation.

Agreeing to a private tribunal has a number of advantages compared to regular legal proceedings. It’s quicker as the courts are less occupied, there are no appeals, and the hearing and process are confirmed. However, agreeing to arbitration also means excluding the jurisdiction of the ordinary courts. Arbitration in Germany is based on the rules of the UNCITRAL Model Law of International Commercial Arbitration and is run by the ordinary courts, the Chambers of Commerce, or a professional arbitrator. The choice belongs to both parties agreeing to arbitration.

The second way of solving a dispute is by mediation or conciliation proceedings, which focus on finding the root cause of the dispute in order to find constructive agreements and solutions for both you and your debtor. Mediation or conciliation is carried out by professional organisations like the Chambers of Industry and Commerce or by professional mediators. There are now increasingly more attorneys who specialise in mediation. The new agreement is not a judgment, but a kind of contract.

(End of chapter 7 - Arbitration and mediation)

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