SMEs account for 90% of all businesses worldwide and 70% of global employment. WIPO promotes the use of mediation among SMEs to reduce the impact of disputes in innovation and creative processes.
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Alternative dispute resolution (ADR) procedures offer several advantages:
Party autonomy. Because of its private nature, ADR affords parties the opportunity to
exercise greater control over the way their dispute is resolved than would be the case in court
litigation. In contrast to court litigation, the parties themselves may select the most appropriate
decision-makers for their dispute. In addition, they may choose the applicable law, place and
language of the proceedings. Increased party autonomy can also result in a faster process, as
parties are free to devise the most efficient procedures for their dispute. This can result in
material cost savings.
Neutrality. ADR can be neutral to the law, language and institutional culture of the
parties, thereby avoiding any home court advantage that one of the parties may enjoy in court-based
litigation, where familiarity with the applicable law and local processes can offer significant
strategic advantages.
A single procedure. Through ADR, the parties can agree to resolve in a single procedure a
dispute involving intellectual property that is protected in a number of different countries,
thereby avoiding the expense and complexity of multi-jurisdictional litigation, and the risk of
inconsistent results.
Confidentiality. ADR proceedings are private. Accordingly, the parties can agree to keep
the proceedings and any results confidential. This allows them to focus on the merits of the
dispute without concern about its public impact, and may be of special importance where commercial
reputations and trade secrets are involved.
Finality of Awards. Unlike court decisions, which can generally be contested through one
or more rounds of litigation, arbitral awards are not normally subject to appeal.
Enforceability of Awards. The United Nations Convention for the Recognition and
Enforcement of Foreign Arbitral Awards of 1958, known as the
New York Convention, generally provides
for the recognition of arbitral awards on par with domestic court judgments without review on the
merits. This greatly facilitates the enforcement of awards across borders.
There are, of course, circumstances in which court litigation is preferable to ADR. For example,
ADR's consensual nature makes it less appropriate if one of the two parties is extremely
uncooperative, which may occur in the context of an extra-contractual infringement dispute. In
addition, a court judgment will be preferable if, in order to clarify its rights, a party seeks to
establish a public legal precedent rather than an award that is limited to the relationship between
the parties. In any event, it is important that potential parties, and their advisors are aware of
their dispute resolution options in order to be able to choose the procedure that best fits their
needs.