The (IR)Relevance of ADRs in Resolving Financial Disputes: An Empirical Assessment and Roadmap of Shanghai
(2016) 46(3) Hong Kong Law Journal 1017-1054
38 Pages Posted: 3 Dec 2016
Date Written: December 2, 2016
Abstract
The increasing resolution of financial disputes through ADRs continues the current trend in China of diversifying and improving the efficiency of its dispute settlement mechanisms. However, when it comes to Shanghai, it has been disappointing to note the following: (1) the third-party mediation mechanism has caused a considerable waste of resources due to the low utility of existing institutional facilities, (2) judicial confirmation of the mediation agreement could distort some basic mediation norms such as voluntariness and party autonomy, and (3) judicial confirmation of the mediation agreement does not have a strong legal basis according to civil procedure law and arbitration law. This article, based on empirical studies, makes the following proposals to correct these institutional failures. First, we could enhance the efficiency of the existing ADR institutions by encouraging financial industrial players to take advantage of mediation and other existing ADRs. Second, various incentives can be offered to users of ADRs. Finally, linking the mediation agreement and arbitral award may help correct problems caused by the frequent use of judicial confirmation.
Keywords: ADR, financial disputes
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