George Tsertsvadze
(Staatliche Ivane-Javakhishvili-Universität Tbilissi, Georgien)
Business Mediation in Georgia and Germany:
Practical Issues and Challenges
Mediation is an internationally recognized legal institution, especially in the business field, as an alternative means of dispute resolution. Resolving a dispute between companies through mediation can save money and time. Mediation is also an important tool for resolving internal company conflicts. Over time, mediation has evolved into an essential component of corporate governance.
The benefits of mediation in Georgian and German societies or business sectors are still poorly understood, preventing this dispute resolution mechanism from becoming fully established.
The stages of development of mediation in Georgia and Germany have been similar over the years. The European Union passed a directive in 2008 encouraging member states to develop a legal framework for mediation and to regulate it at the legislative level [1]. As a result, an increasing number of countries began to develop and implement a legal framework for mediation. Among them was Germany, which, in response to the directive’s requirements, enacted a law on mediation in 2012, known as the “Mediation Act” (Mediationsgesetz) [2]. In the same year, changes were made to the Civil Procedure Code of Georgia[3], including the addition of a new chapter on Court Mediation. Later, in 2019, Georgia passed a law on mediation[4].
As can be seen, there is a sound legal framework for mediation in both countries. However, its mere existence is insufficient for the institution to gain traction. Neither Georgia nor Germany can boast of a high rate of business dispute resolution through mediation. The reasons are different.
Lawyers in Germany are skeptical of mediation because it is an alternative means of dispute resolution, and choosing it means avoiding the traditional means (the court), or even sometimes considering them ineffective. The aforementioned indicates its low prevalence in the German legal community, which is more conservative in nature. In addition, mediation is regulated differently depending on the “Länder” (lands).
The bureaucratic process of becoming a mediator is an impediment to the establishment of mediation in Georgia. The mentioned itself raises a number of other issues, such as the question of the effectiveness of enforcement, etc. The main challenge remains a lack of awareness of mediation in society or the business sector.
Only legislative action is not sufficient to institutionalize mediation and alternative dispute resolution mechanisms in general; active steps in terms of awareness raising from both the state and civil society are essential.