Empowering Mediators in the MENA Region

The conflict began between two business partners who had co-founded a small consulting firm. After years of working together, disagreements emerged over how profits should be distributed and which strategic path the company should take. What started as minor differences soon escalated into a serious dispute—serious enough that both partners considered dissolving the business entirely.

In search of an alternative, they voluntarily agreed to mediation. From the outset, the process was carefully structured. The first stage focused on preparation: setting ground rules such as confidentiality, respectful communication, and equal turn-taking. This laid the foundation for a safe and balanced discussion.

The second stage was about storytelling and exploration. Each partner was given the chance to share their perspective without interruption. Active listening and reframing played a crucial role here, helping to reduce hostility and clarify the real needs that lay beneath the financial conflict. This stage allowed both parties to recognize that the dispute was not just about numbers but about future expectations and trust.

The third stage moved toward problem-solving and agreement-building. I facilitated brainstorming sessions where different options were generated, compared, and negotiated. Tools proved especially useful here: a whiteboard was used to map out each partner’s financial contributions, roles, and expectations, giving the conversation an objective anchor. Another strategy, “option packaging,” grouped potential solutions into balanced proposals so that both partners felt a sense of gain rather than loss.

At the conclusion of the process, a written agreement was reached. One partner would buy out the other’s shares under a structured 12-month payment plan. Together, they also prepared a joint statement for their clients to preserve both reputations and ensure business continuity.

The outcome was not just a settlement but a transformation. Both partners expressed relief and satisfaction. Mediation allowed them to part ways respectfully, without costly litigation, and with their professional relationship and reputations intact. This case serves as a clear reminder that mediation is not only about resolving disputes—it is about preserving dignity, relationships, and future opportunities.

‍

The conflict had all the makings of a legal war: two pharmaceutical companies—once united by shared scientific vision and personal conviction—were now locked in a high-stakes dispute over intellectual property, reputational damage, and abandoned research. Their partnership, which had once produced a breakthrough drug to treat a rare genetic disorder, had collapsed following the sudden appearance of a new product patented by one side, prompting accusations of betrayal, infringement, and credit theft.

On the surface, it was about patents. But beneath that, it was about recognition, trust, grief, and the disillusionment that follows when a shared mission unravels. Both CEOs had built their companies on the motivation of helping loved ones suffering from the same rare disease. Their relationship was forged through science, but also through personal connection—a connection that had been ruptured, perhaps irreparably.

As the mediator, my task was not only to help them find legal and commercial clarity, but to help them navigate the emotional terrain that had made the conflict so painful—and so stuck.

We began in the usual way: separate meetings, private moments of truth-telling and strategy, space to let emotion be voiced without consequence. It was immediately clear that this was not just a business dispute. Both parties carried grief and disappointment, as well as a deep fear that the collapse of the relationship could derail work that had real impact on patients' lives—including their own loved ones.

Over the course of the sessions, I used a blend of techniques that focused not just on legal and financial positions, but on the emotional stakes and internal narratives each party was holding. I worked to name emotions that were often unspoken—frustration, betrayal, sadness, pride—and helped each side understand not just what the other was saying, but what they were feeling. At times, this meant slowing down conversations that were rushing into legal posturing, in order to surface what was really driving the positions beneath.

Throughout, I used coaching-style questioning to help each CEO step back and examine how their actions—and reactions—had contributed to the rupture. With the support of financial, IP, and regulatory experts, we addressed the objective dimensions of the case without becoming entangled in technicalities. These

voices were crucial, but I ensured they did not dominate the space or derail the deeper work of relational repair.

At a critical point, I created a space that had not existed in months: a closed-door conversation between the two CEOs, just the three of us at the table, without lawyers, experts, or documents. What happened in that room changed the direction of the mediation.

For the fi rst time, they spoke—not as adversaries, but as partners who had lost something valuable. They discussed the origins of their work, the hopes they’d carried, the pride they felt when their collaboration bore fruit. They also spoke of disappointment, of how assumptions and silence had fed the rupture. They acknowledged each other’s contributions. One admitted to having acted impulsively; the other, to having underestimated

the importance of visibility and recognition. They didn’t resolve everything in that room. But they began again.

In the days that followed, new ground was covered. The two sides reached a structured, detailed agreement that included financial compensation for royalties and damages, clarified rights and credit for past and future patents, and a revived research partnership—with clearer roles and safeguards.

But the real success was more than contractual. It was the reopening of a relationship—professional and personal—that had once been a source of energy, inspiration, and results. The agreement will allow their teams to return to research that may bring another vital medicine to the world. And, perhaps most meaningfully, it allows two scientists, and two people, to step back into the work that once connected them—not with naïve optimism, but with hard-earned trust.

‍

Summary:
This article written by Aseel Zimmo and Umar Azmeh of Qatar International Court and Dispute Resolution Centre explores the enforceability and practical challenges of multi-tier dispute resolution (MTDR) clauses, which require parties to attempt negotiation and mediation before pursuing arbitration or litigation.

‍

Analysis:
In our first article of this two-part set, we covered the difficulties encountered with poorly drafted arbitration clauses, explaining how these might be treated under Bahrani law and Qatari law, respectively Arbitration Clauses in Qatar and Bahrain. This article will drill down deeper into arbitration clauses, focusing not on the jurisdictional provisions, but on the procedural aspects of some arbitration clauses. In today's complex commercial landscape, multi-tier dispute resolution (MTDR) clauses have become commonplace in crossborder contracts. These clauses require parties to follow a sequence of steps, such as negotiation and mediation before pursuing formal legal remedies; arbitration or litigation. They are intended to foster early resolution, preserve business relationships, and reduce time and cost. They often work very well. However, problems can occur when a party does not follow the tiering as set out in the contract. What, therefore, can happen when a party bypasses a preliminary step or claims that a condition precedent has not been satisfied?

‍

What are MTDR clauses?

MTDR clauses, also known as escalation or step clauses, structure the dispute resolution process in phases. A typical clause may require:

Tier 1: negotiation between senior executives within a set period.

Tier 2: mediation or conciliation.

Tier 3: arbitration or litigation as a last resort.

These clauses serve two goals: (1) to encourage amicable settlement at an early stage, and (2) to reserve formal procedures for intractable disputes.

‍

Enforceability:
MTDR clauses are clauses in a contract like any other. Courts generally uphold these clauses, particularly where the language is clear and unambiguous. Unless there is something unworkable or against public policy, as with any contractual clause,  courts will likely enable them. However, disputes often arise when one party initiates arbitration or litigation without completing a prior tier of the clause. Courts have acknowledged the enforceability of MTDR clauses where the preliminary steps are expressed as mandatory conditions precedent to arbitration or litigation. If the language used is clear (e.g. "must first attempt mediation within 30 days"), tribunals and courts may decline jurisdiction or stay proceedings until the clause is complied with. However, where the clause is ambiguous, non-specific, or expressed in aspirational terms (e.g., “parties may consider mediation” or “use reasonable endeavours”), courts may treat it as non-binding and proceed with the substantive claim. As ever, the key is in the language.

‍

Practical Challenges:

Despite growing recognition, MTDR clauses still pose practical and procedural challenges:

- Delay tactics: a party may invoke non-compliance tactically to delay arbitration or litigation.
-Unclear drafting: vague or open-ended clauses are difficult to comply with as well as enforce.
- No formal mediation culture: parties may not have access to structured mediation processes within a jurisdiction, undermining the practical effect of MTDR clauses.
- No explicit statutory provisions: arbitration laws often do not explicitly address MTDR clauses, leaving interpretation to tribunals and courts.

‍

Recommendations for Practitioners and In-House Counsel:

To maximise enforceability and minimise procedural disputes, MTDR clauses in contracts should be:
1. Clear and specific: mandatory language and fixed timeframes (e.g. “must mediate within 30 days”). Using non-imperative language such as “may” would inject ambiguity and increase the likelihood of the tier being deemed optional.
2. Well-structured: name the institution (e.g. CEDR), rules (e.g. ICC Mediation Rules) and method (e.g. in person, virtual, hybrid etc) applicable to each tier.
3. Include waiver triggers: state that if one party refuses or fails to participate, the condition is deemed waived.
4. Consider local context: ensure the clause is feasible under local practice (e.g. mediation institutions, language).
5. Record attempts: parties should document their efforts to comply, as evidence of good faith.

‍

Conclusion:

MTDR clauses are valuable tools in managing disputes, and courts across the world are increasingly accommodating of their role. However, their success depends heavily on precise drafting, genuine engagement in each step, and awareness courts and tribunals interpret such clauses.

In today’s fast-paced global economy, businesses face increasing pressure to resolve disputes efficiently while preserving relationships critical to their success.

While litigation is sometimes necessary, it is often costly, time-consuming, and adversarial, straining partnerships and draining resources. Mediation, by contrast,

offers a strategic alternative—one that not only resolves conflicts effectively but also fosters long-term business stability and economic sustainability.

‍

Mediation: A Relationship-Oriented solution

Mediation is a voluntary and confidential process facilitated by a neutral third party, aiming to help disputing parties reach a mutually agreeable outcome. Unlike litigation or arbitration, which prioritize winning over collaboration, mediation emphasizes dialogue, mutual understanding, and future cooperation. Experienced mediators facilitate open communication, helping parties rebuild trust and goodwill. A 2024 report by the International Chamber of Commerce (ICC) highlights that 80% of businesses using mediation under ICC Mediation Rules reported improved communication and stronger partnerships post-resolution, compared to only 35% for arbitration-based outcomes. This collaborative approach ensures disputes do not derail valuable commercial relationships.

Mediation’s ability to preserve relationships is exemplified by real-world cases. For instance, a 2023 JAMS case study detailed how mediation resolved a $20 million contract dispute between a U.S. technology firm and its Asian supplier over intellectual property rights. By addressing underlying concerns—such as licensing terms—through mediation, the parties not only settled the dispute but also established a new joint venture, generating $75 million in revenue over two years. Similarly, a 2024 CEDR mediation between two European pharmaceutical companies resolved a €15 million supply chain dispute, preserving a 10-year partnership critical to both firms’ operations.

‍

Enhancing Business Relationship Stability

Whether between suppliers, joint venture partners, or clients, business relationships are often more valuable than any single transaction. Mediation supports stability by:

• Preserving partnerships: Sensitive business information remains private, preserving corporate integrity and trust.

Mediation encourages solutions that satisfy both parties, fostering ongoing collaboration. A 2024 AAA report found that 87% of businesses that resolved disputes through mediation continued their partnerships, compared to only 40% after litigation.

• Reducing hostility: The collaborative environment minimizes reputational damage and emotional strain.

By focusing on mutual interests, mediation minimizes adversarial dynamics that erode trust. A 2023 CEDR case study documented a £8 million dispute between a UK retailer and its logistics provider, resolved through mediation in six weeks, maintaining a partnership that accounted for 20% of the retailer’s supply chain.

• Ensuring confidentiality: Sensitive business information remains private, preserving corporate integrity and trust. Unlike public court proceedings, mediation protects proprietary data, critical for multinationals in competitive industries.

Testimonials from multinational corporations underscore mediation’s impact. In 2024, Siemens AG reported using mediation to resolve a $50 million dispute with a Latin American energy partner, saving an estimated $7 million in legal costs compared to litigation and enabling a new $120 million renewable energy project. A 2025 testimonial from Unilever, published by Mediate.com, highlighted how mediation resolved a $10 million dispute with a Southeast Asian supplier, avoiding $3 million in potential losses and strengthening a supply chain critical to its regional operations. Additionally, a 2024 ICC Mediation Roundtable featured a testimonial from a Fortune 500 retailer, which credited mediation with preserving a $200 million distribution agreement with a Middle Eastern partner, avoiding costly arbitration.

‍

Driving Economic Sustainability

Mediation contributes to economic sustainability by reducing costs, enhancing efficiency, and supporting long-term business viability:

• Cost savings: Mediation is significantly less expensive than litigation. A 2023 World Bank report estimated that mediation costs 65–85% less than litigation globally, with average mediation expenses ranging from $8,000 to $40,000 compared to $150,000–$600,000 for litigation in complex commercial cases. For example, a 2024 ICC mediation case involving a $30 million construction dispute saved $4 million in legal fees and resolved the matter in two months, compared to an estimated 24 months in court.

• Time efficiency: Mediation resolves disputes faster, allowing businesses to focus on growth. The ICC’s 2024 Dispute Resolution Statistics reported that mediations under ICC Rules typically take 1–2 months, compared to 12–36 months for litigation, reducing downtime and opportunity costs. A 2023 AAA case study noted a mediation that resolved a $5 million dispute between two U.S. manufacturers in three weeks, saving $500,000 in lost productivity.

• Systemic benefits: In regions with overloaded or underdeveloped judicial systems, mediation alleviates pressure on courts. A 2024 UNCITRAL study found that countries with robust mediation frameworks saw a 35% reduction in commercial case backlogs, enhancing economic stability. For example, Bahrain’s Chamber for Dispute Resolution (BCDR) reported in 2024 that its mediation services reduced court caseloads by 20% for disputes exceeding $1.3 million, boosting investor confidence. Beyond dispute resolution, mediation serves as a proactive enabler for businesses.

Companies like Procter & Gamble have integrated mediation clauses into contracts to facilitate negotiations and prevent conflicts. A 2024 Harvard Business Review article highlighted how a global pharmaceutical company used mediation to structure a $300 million joint venture in Asia, aligning partner interests and avoiding future disputes. Similarly, a 2025 ICC report noted that 37 mediation requests were filed under ICC Mediation Rules in 2024, with 60% involving proactive negotiations to establish partnerships or prevent disputes, demonstrating mediation’s role in business enablement. The Hong Kong government’s 2024 decision to incorporate mediation clauses in all government contracts further underscores mediation’s strategic value in fostering business collaboration.

‍

Conclusion: Mediation as a Strategic Business Tool

For over three decades, mediation has proven to be a cornerstone of sustainable economic growth—not just by resolving disputes but by strengthening relationships critical to business success. The ICC’s 2024 statistics, reporting 61 new mediation cases, reflect growing global trust in mediation’s ability to deliver efficient, cost- effective solutions. Mediation supports these relationships by resolving conflicts in a way that promotes understanding, respect, and mutual benefit. In a world where commercial disputes are inevitable, choosing mediation can determine whether a business merely survives or truly thrives. As Joseph Grynbaum aptly stated, “An ounce of mediation is worth a pound of arbitration and a ton of litigation.” By embracing mediation, businesses can achieve cost-effective, relationship-preserving solutions that drive economic sustainability and long-term success in today’s interconnected global economy.

‍