Commercial mediation in Belgium
Contractual parties can agree to mediation prior to or after the emergence of a dispute. Three types of mediation are recognised under Belgian law: (i) non-judicial mediation, (ii) judicial mediation, and (iii) entirely voluntary mediation. Mediation is generally voluntary but in some circumstances the court can order that parties mediate, or certain situations may require mediation prior to the commencement of legal proceedings. Documents drawn up and statements made during the mediation are confidential and any third parties called as witnesses or experts are bound by the confidentiality obligation. Settlement agreements following mediation are either ratified by the court or enforced as contracts.
What is the status of mediation in this jurisdiction?
In accordance with the principle of contractual freedom of the parties, as stipulated in Article 1134 of the Belgian Civil Code, parties can agree to mediation as a form of dispute resolution, either prior to or after the emergence of a dispute.
In 2005, the Belgian legislator explicitly reconfirmed that mediation is a valid form of dispute resolution under Belgian law and introduced a new section into the Belgian Judicial Code which sets out the basic rules and principles of mediation (Articles 1724 to 1737 of the Judicial Code). This section has been updated by the Act of 18 June 2018, which entered into force on 1 January 2019. According to Article 1724 of the Judicial Code, any dispute can be the subject of a mediation, unless the dispute relates to a matter which falls within the scope of the public order exception and is therefore excluded from the private contractual sphere. Public entities may also submit their disputes to mediation.
How is a mediation conducted?
Belgian law recognises three types of mediation, two of which are regulated by law and one being solely governed by the parties’ agreement:
(i) “Non-judicial mediation” (out-of-court mediation) (Articles 1730 to 1733 of the Judicial Code).
Each party can, before, during or after legal or arbitral proceedings, propose to the other parties that they undertake a so-called “non-judicial mediation”.
Under a non-judicial mediation, the parties must first agree on the appointment of a mediator or must entrust a third party with the appointment of a mediator.
The parties must then decide, in consultation with the appointed mediator, the procedural rules and timetable of the mediation. Their agreement on these aspects is recorded in a written “mediation protocol”, which has to be signed by the parties and the mediator.
The mediation protocol must contain the following elements:
- the name and domicile of the parties and their respective counsel;
- the name, capacity and address of the mediator and, if applicable, noting that the mediator is recognised by the Federal Mediation Commission;
- an explicit reminder of the principle that the mediation is conducted on a voluntary basis;
- a summary overview of the dispute;
- the level of confidentiality of the documents filed, and statements made, in the framework of the mediation;
- information relating to the fees of the mediator and payment thereof;
- the date; and
- the signatures of the parties and the mediator.
From the moment a mediation protocol is signed, the limitation period for the claims relating to the dispute is suspended for the duration of the mediation.
Any settlement subsequently reached by the parties on the merits of the dispute is recorded in a written agreement, which is dated and signed by the parties and the mediator. The agreement contains a detailed description of the commitments of each of the parties and, again, if applicable, notes that the mediator is recognised by the Federal Mediation Commission.
If the parties reach a settlement and if the mediator is recognised by the Federal Mediation Commission, each of the parties can request the competent court to ratify the settlement agreement. The court can only refuse such ratification if the agreement is contrary to the public interest or, in the sphere of family law mediations, if the agreement affects the interests of minors.
Upon ratification, the settlement agreement has the force and effect of a final judgment.
(ii) “Judicial mediation” (Articles 1734 to 1737 of the Judicial Code).
At any stage during the proceedings (with the exception of proceedings before the Supreme Court and the tribunal d’arrondissement/ arrondissementsrechtbank), a competent court can, at the joint request of all parties or ex officio (but with the consent of all parties), order a mediation. The court can order a mediation provided that submissions before the court have not closed.
The competent court may also, at the introductory hearing or at a case-management hearing (scheduled at the latest the last day of the month following the month of the filing of the defendant’s first trial brief), at the request of one party or ex officio (unless all the parties refuse), order a mediation. This new provision was introduced by the Belgian legislator in 2018 in order to promote mediation. However, the mediation remains a voluntary process and any party may decide to end the mediation at any stage.
A judicial mediation can relate to the entire dispute or a part of it. Where the judicial mediation has been ordered upon the joint request of all parties, the terms granted to the parties for the submission of trial briefs and the organisation of the hearing are suspended from the date of the joint request for mediation.
The parties must jointly agree the appointment of a mediator, who must be recognised by the Federal Mediation Commission, although there are certain exceptions. The court then ratifies the parties’ choice of mediator in a so-called “mediation order” which contains, as well as the express agreement of the parties to mediate, the name, capacity and address of the mediator. The mediation order further stipulates the initial term of the mediator’s assignment – which may not exceed six months – and includes a date upon which the parties must report to the court on the outcome of the mediation.
The appointed mediator must be informed of his assignment within eight days of the date of the mediation order. Within a further eight days, the appointed mediator must inform the parties and the court of the place, date and time upon which the mediation will commence.
At all times during the mediation, the court remains competent to intervene with any measures it deems necessary to assist the mediation. At the request of the mediator or of one of the parties, the court can terminate the mediation prior to the end of the specified mediation term. If the parties do not reach an agreement during the initial mediation term, they can ask the court either to grant an additional mediation term or resume the proceedings. These measures are not subject to appeal.
In the event that the parties reach a settlement agreement, either party can ask the court to ratify the agreement. Again, the court can only refuse ratification if the agreement is contrary to the public interest or, in the sphere of family law mediations, if the agreement affects the interests of minors. Upon ratification of the settlement agreement, the agreement has the force and effect of a final judgment.
(iii) “Entirely voluntary mediation” outside the framework of the Judicial Code.
The parties can agree to submit their dispute to mediation outside the framework of the Judicial Code. In that case, all aspects of the mediation will be decided upon by the parties themselves, without intervention from the mediator or the court, in accordance with the principle of contractual freedom (Article 1134 of the Civil Code). However, any settlement agreement reached under this type of mediation will not be eligible for ratification by the competent court.
In the field of consumer law, Belgium transposed the 2013 Consumer ADR Directive by the Belgian Act of 4 April 2014 on the Out-of-Court Resolution of Consumer Disputes, adopted as Book XVI of the Belgian Code of Economic Law. It sets out the standards for consumer complaints procedures, the quality requirements ADR entities have to meet (accessibility, expertise, independence, impartiality, transparency, effectiveness, fairness and liberty), and establishes a Consumer Mediation Service.
The Act only applies to the resolution of consumer disputes, i.e. disputes between a consumer and a trader relating to the execution of a sales or services contract or relating to the use of a product (goods or services). Consequently, internal complaints procedures, direct negotiations between a consumer and a trader, business-to-business (B2B) and consumer-to-consumer (C2C) disputes fall outside the scope of the Act.
The Consumer Mediation Service is a public body with legal personality, with the following three main functions:
(i) informing consumers and traders about their rights and obligations, particularly about the options available for the out-of-court resolution of consumer disputes;
(ii) receiving all requests for the out-of-court resolution of consumer disputes and transferring them to any appropriate existing ADR entity; and
(iii) handling all requests for the out-of-court resolution of disputes of which no existing ADR entity is competent. The Consumer Mediation Service thus acts as Belgium’s front office and residual ADR entity for all consumer complaints.
In terms of procedure to be followed, the Act sets out the procedural rules for the handling of residual consumer disputes by the Consumer Mediation Service and lists the basic requirements that the procedural rules of the different ADR entities must fulfil.
Other consumer mediation services and procedures have been established in specific sectors, such as the energy and the financial sectors.
Does the court have powers to support a mediation?
The most efficient tool in support of mediated settlement agreements is the potential to have an agreement which has been reached in the framework of a “non-judicial mediation” or “judicial mediation” ratified by the competent court. Upon ratification, the agreement has the force and effect of a final judgment. Pursuant to the principle of res judicata, the parties may not bring their settlement agreement before the court for further adjudication.
As discussed above, the courts have certain powers in the framework of a “judicial mediation”. They can order the parties to mediate (including ex officio), advise in relation to the appointment of a mediator, as well as supervise and guide the mediation process. However, in most instances, the court will only be able to make supporting orders if all parties agree.
Are mediations confidential?
Pursuant to Article 1728 of the Judicial Code, all documents drawn up and all statements made during and for the purpose of a mediation conducted within the framework of the Judicial Code are confidential. They cannot be used in judicial, administrative or arbitral proceedings or in any other dispute resolution procedure and they are inadmissible as evidence. Documents used in breach of the confidentiality obligation will be ex officio excluded from the proceedings. The confidentiality obligation can only be lifted if all parties agree in writing.
The mediation protocol, the settlement agreement and the mediator’s document recording the failure of the mediation are not confidential, unless all the parties otherwise agree in writing.
If a party breaches the confidentiality obligation, the court or arbitral tribunal will determine whether any compensation should be granted to the other party or parties.
The mediator is equally bound by the confidentiality obligation and by a duty of professional secrecy, the breach of which is criminally sanctioned (Article 458 of the Criminal Code). The mediator cannot be summoned by the parties to act as a witness in subsequent judicial, administrative or arbitral proceedings.
If, during the mediation and with the consent of the parties, the mediator has called third parties as witnesses or experts, those parties are also bound by the confidentiality obligation. Moreover, the third-party expert will also be bound by the duty of professional secrecy and cannot be summoned by the parties to act as a witness in subsequent judicial, administrative or arbitral proceedings.
Does failure to mediate attract adverse cost consequences?
If there is no obligation upon the parties to mediate (e.g. pursuant to a mediation clause in their contract), it is highly unlikely that a failure to initiate mediation by one party will result in the court or arbitral tribunal ordering that party to pay compensation to the other parties.
The court or arbitral tribunal might, however, do so if the refusal to co-operate with a mediation procedure amounts to a clear abuse of a right or a breach of previously agreed provisions.
How are settlement agreements enforced?
As outlined above, a settlement agreement reached in the framework of a “non-judicial mediation” or a “judicial mediation” can be ratified by the competent court, which gives the agreement the force and effect of a final judgment. Pursuant to the principle of res judicata, the parties may not bring their settlement agreement before the court for further adjudication.
Settlement agreements reached in the framework of an “entirely voluntary mediation”, as well as non-ratified settlement agreements reached in the framework of a “non-judicial” or “judicial mediation”, are enforced as contracts. Any disputes arising out of or in connection with the agreement can be brought before the competent court or arbitral tribunal.
Is there a system of accreditation and/or regulatory body for mediators?
Articles 1727 to Article 1727/6 of the Judicial Code provide for the creation of a Federal Mediation Commission, which consists of three “standing commissions” and “ad “hoc commissions”.
The Federal Mediation Commission has, among others, the following tasks:
(i) accrediting the entities and bodies responsible for the training of mediators and accrediting their training and learning programmes;
(ii) determining the criteria for accredited mediators and accrediting mediators who fulfil those criteria;
(iii) determining the rules and procedures for accreditation of mediators and for revoking accreditations;
(iv) drawing up a list of accredited mediators and distributing the list among the courts;
(v) drafting a code of conduct for mediators;
(vi) determining the rules, procedures and sanctions for disciplinary matters; and
(vii) promoting mediation in Belgium.
The three standing commissions are responsible, respectively, for (i) the accreditation of the Belgian and foreign mediators, (ii) the accreditation and supervision of the training learning programmes, and (iii) the discipline and the handling of complaints.
Article 1726 of the Judicial Code contains a list of minimum requirements which each mediator must fulfil in order to be eligible for accreditation by the general commission, including:
(i) having attended accredited legal and practical training and passed the exams;
(ii) providing proof of the required guarantees regarding neutrality, independence and impartiality;
(iii) not having been convicted of any criminal offences which are incompatible with the position of accredited mediator;
(iv) not having incurred any disciplinary or administrative sanction incompatible with the position of accredited mediator nor having had its accreditation revoked; and
(v) undertaking in writing to comply with the code of conduct for mediators.
Once accredited, mediators need to attend continuous training programmes recognised by the commission.