Mediation under Cypriot Law

One of the most popular modern alternatives in resolving a civil or commercial conflict is mediation. The procedure is of consensual nature, as it is based on the parties’ free will to voluntarily engage in mediation proceedings. The mediator acts as an intermediary, with no adjudicatory power, who sets the grounds for a dialogue between the parties, in order to amicably resolve the dispute. The main characteristics of mediation are neutrality and confidentiality. As apposed to the judicial procedures’ formal, authoritative and claim-oriented nature, mediation is considered to be a flexible, self- oriented, amicable dialogue, governed by the Certain Aspects of Mediation in Civil Matters Law 159(I)/12.

The sources of the mediation procedure, as implemented in the national legislation, find their routes in the EU “Directive 2008/52/EC of the European Parliament and of the Council on Certain Aspects of Mediation in Civil and Commercial Matters” which entered into vigor on June 13th of 2008. This legal document sets the grounds for cross-border mediation for all EU Member States, except for Denmark.

The EU legislation distinguishes three (3) types of mediation proceedings:
i) Private mediation: independent from court proceedings;
ii) Court-annexed mediation: initiated by a judicial decision, with no further court participation;
iii) Judicial mediation: connected to the court through the utilization of the judicial venue and agents.

i) Conflict resolution through an amicable and self-determined dialogue;
ii) Constructive dialoge;
iii) Substantive justice through the principle of voluntariness;
iv) Fruitful and just results for both parties in the process
v) Cost-efficient procedure;
vi) Rapid dispute resolution
vii) Individual solutions
viii) Maintenance of good commercial relationships with the opposite party.

i) Introduction & Initiation:
a) Information of the parties in the procedure
b) Explanation of the procedure and the rules
c) Introduction of the roles of the parties
d) Choice of the mediator
e) Determination of the renumeration of the mediator
f) Signing of a confidentiality agreement
g) Determination of the duration of the procedure
h) Choice of place and time of the mediation procedure
i) Choice of the language in which the procedure shall be carried out

ii) Information breakdown:
a) investigation of the dispute
b) clarification points
c) negotiation subject
d) problems
e) concretization of the conflict

iii) Determination of the parties’ interest
iv) Solution development:
a) proposals of the parties
b) discussion with the mediator
c) feedback by the mediator
v) Mediation and Courts:

The role of the Courts is purely supervisory. The main characteristic of mediation its’ the parties’ autonomy and consent, thus a judge may issue a stay of judicial proceedings in favor of the initiation of a mediation, without obliging or preventing the parties from participating in one. vi) Confidentiality:

According to the Law, all information discussed during the mediation procedure cannot be disclosed to any third parties or in any civil and/or commercial proceeding or arbitration. The rule is applicable to all parties involved in the mediation, including the mediator. However, two exceptions are admitted by the Law:

a) In case of overriding public policy concerns;
b) In case the enforcement of the agreement depends on the disclosure.
vii) Enforcement of the Settlement Agreement:
a) Issuance of a settlement agreement which is recorded and legally implemented;
b) Application to the Court by any of the parties, with the prior consent of the opposite party, for the enforcement of the settlement agreement;
c) Issuance of a declaration of the enforceability of the settlement agreement by the Court. The legal effect of such a declaration is equally binding as a judgment or Court order;
d) The Court may issue a decision of reinforcement of the content of the settlement agreement.
viii) Termination:

Mediation may be terminated in the following cases:
a) Conclusion of a settlement agreement;
b) Agreement to terminate the mediation procedure;
c) Failure to reach a settlement agreement;
d) Consent withdrawal by one of the parties in the procedure;
e) Termination by the mediator due to the futility or unconducive character of the procedure
f) Termination by the mediator due to the eventual rejection of the settlement agreement by the Court
g) Termination by the mediator due to the illegal character of the settlement agreement

The present article is intended for informational purposes only and does not, under any circumstances, constitute legal advice. For further information on this matter, please contact Arsen Theofanidis LLC and one of our legal advisors shall be glad to assist you.

N. Kalifatidou
Advocate – Legal Consultant
Arsen Theofanidis LLC