“Discuss the Application of Alternative Dispute resolution (ADR) in International Disputes and the Concerned Authorities & Institutions”.

  1. 1.      INTRODUCTION;

 Alternative Dispute Resolution (ADR, sometimes also called “Appropriate Dispute Resolution”) is a general term, used to define a set of approaches and techniques aimed at resolving disputes in a non-confrontational way. Alternative Dispute Resolution (“ADR”) processes are alternative methods of helping people resolve legal problems before going to court. ADR involves an independent third person, called a “neutral” who tries to help resolve or narrow the areas of conflict[1]. The use of ADR early in a case can result in the more efficient, cost-effective resolution of disputes with greater satisfaction to the parties. It covers a broad spectrum of approaches, from party-to-party engagement in negotiations as the most direct way to reach a mutually accepted resolution, to arbitration[2] and adjudication at the other end, where an external party imposes a solution Somewhere along the axis of ADR approaches between these two extremes lies “mediation[3],” a process by which a third party aids the disputants to reach a mutually agreed solution.

Increasingly, the international business community is using arbitration to resolve commercial disputes arising in the global marketplace. Supportive laws are in place in many countries that provide a favorable climate for the enforcement of arbitration clauses. International commercial arbitration awards are recognized by national courts in most parts of the world.

Many of the world’s leading international companies select arbitration rather than court proceedings to resolve commercial disputes. In the ADR Blueprint Discussion Paper released in April 2009, the ADR Directorate recommended the introduction of new commercial arbitration laws and the establishment of an international arbitration center in Australia. The aim of these recommendations is to establish Sydney as a center for international commercial arbitration. NSWs new commercial arbitration legislation, which is based on the United Nations Commission on International Trade Law (UNCITRAL) Model Law on International Commercial Arbitration, was passed on 22 June 2010. The Australian International Disputes Centre was established in 2010 with the assistance of the NSW and Commonwealth Governments.





Whenever two or more parties have a dispute, it would be preferable if they were able to discuss it between themselves and to arrive at a peaceful solution. That is true whether the parties are members of a family, States or commercial entities. Only the parties themselves can achieve a solution that will not only resolve the dispute, but will facilitate a useful future relationship. However, sometimes the parties are not interested in any future relationship and only want the dispute to be settled, preferably on their own terms. That may lead to war or its private equivalents. Even when they are interested in a peaceful settlement of the dispute, it is not infrequent that the parties are not able to discuss – or negotiate – a mutually agreeable solution. In such a situation the aid of a third party must be sought[4].

There are two basic methods of defining an international arbitration for the above-mentioned purposes. One is to consider the transaction; does it involve a transaction that is either in a State other than the place of arbitration or that takes place in two or more States. The other method is to consider the parties; do they come from different States.

Particular important international ADR authorities and institutions are described below which are specialize in settling international disputes.

I.     Association for International Arbitration (AIA)

 The Association for International Arbitration (AIA) works towards promotion of alternative dispute resolution (ADR) in general and arbitration in particular, as a means of dispute resolution and strives to bring together the global community in this field, be it as professionals in the form of judges, lawyers, arbitrators, mediators or as academics as well research scholars and students[5]. With this unique blend of people, it is our endeavor to inculcate an interest in ADR, not only in the professional sphere but also create awareness and interest in it among budding professionals in law schools/universities all around the globe.

II. North American Free Trade Area (NAFTA) – Dispute Settlement Procedures

The North American Free Trade Area, comprising Canada, Mexico and the United States, was established in 1992 by the North American Free Trade Agreement (NAFTA). Like several other regional economic integration agreements, such as the European Communities, the EFTA, the Andean Community or the Mercosur, the objective of NAFTA is to remove trade barriers, create a common market, and promote economic cooperation between participating states[6]. However, unlike most similar agreements, NAFTA falls significantly short of creating an integrated legal system, much less a structured dispute settlement system.

           III. International Alternative Dispute Resolution – World Bank

International alternative dispute resolution (ADR) is the process of settling transnational disputes through the use of dispute resolution mechanisms other than courts. Due to the time, expense and complications involved in resolving and enforcing disputes between transnational parties in courts, international ADR is sought because it can be a confidential, speedy and predictable process and the parties might have more trust in the enforceability of these settlements.

IV. International Chamber of Commerce (ICC) – Commission on Arbitration

The Commission on Arbitration aims to create a forum for experts to pool ideas and impact new policy on practical issues relating to international settlement, the settlement of international business disputes and the legal and procedural aspects of arbitration. The Commission also aims to examine ICC dispute settlement services in view of current developments, including new technologies[7].

            V. International Court of Environmental Arbitration and Conciliation

The International Court of Environmental Arbitration and Conciliation (“the Court”) was established in Mexico D.F. on November 1994, by 28 lawyers from 22 different countries, as a form of Institutionalized Arbitration. The Court facilitates through conciliation and arbitration the settlement of environmental disputes submitted by States, natural or legal persons (“Parties”).[8]

VI.   International Centre for Settlement of Investment Disputes (ICSID)


The International Centre for Settlement of Investment Disputes (ICSID) is an autonomous international organization, which has close links with and was created by the World Bank in 1966. ICSID facilitates the arbitration of disputes between member countries and foreign investors who are nationals of other member countries. Parties may voluntarily resort to ICSID arbitrations; however, once they have consented to ICSID arbitration, the parties cannot withdraw their consent.

VII. International Chamber of Commerce (ICC)


The International Chamber of Commerce (ICC) is an international organization that, amongst other things, targets international business disputes by providing international arbitration and other forms of dispute resolution. ICC arbitrations offer transnational parties the choice and place of arbitration and its own rules of arbitration, including model clauses that can be used in business contracts.[9]


 In past decades, only diplomats conducted international negotiation and agreements between countries. Negotiating today is not restricted to the diplomatic corps; it involves professional people, experts, non-governmental organizations, local interested groups, local authorities, and international entities, all of which have an impact on the process. Cultural issues play a major part in international negotiation, and have a significant impact on it. A strong personal relationship and trust between the negotiators can be a positive force in future agreements. Issues such as personal relations, time, sovereignty, face-saving, mode of bargaining, and hierarchy, which are culturally based, need to be considered during negotiations between different nations, societies, and ethnic groups. Today it is realized that conflicts and the issues involved are very complex, the outcomes are far reaching, and can often affect other nations,

a region, or the world. The international negotiation process is more complex, because of the various interdependencies between countries, cultural issues, and past history, and the fact that individual people or a group of people negotiate on behalf of a collective. Their culture, psychology, emotional state, behavior, ethics, values, and private agendas may affect the outcome of the negotiation. In the past decades the world has become one global village. Distances are smaller, communication means are easier and faster, and the economy has become a major factor in international relations. A conflict between two or more countries may affect a whole region.

Some conflicts may not be resolved easily, and can last many years. Sometimes these conflicts persist in spite of the fact that they cause heavy losses of resources, and even human life. According to a study at Stanford University (Arrow et al., 1995) there are three categories of barriers to resolving conflicts:

a)      Tactical and strategic barriers; these stem from the parties’ efforts to maximize short or long term gains.[10]

b)      Psychological barriers; these stem from differences in social identity, needs, fear, interpretation, values, and perceptions of one another.[11]

c)      Organizational, institutional and structural barriers; these can disrupt the transfer of information, and prevent leaders from reaching decisions that are in the interests of the parties in dispute.[12]

A dispute between Israel and Egypt over the location of the border between the two countries in the Gulf of the Red Sea was settled in favor of Egypt by an international arbitration panel, on September 29 1988. Israel had to return the town of Taba, a resort town near Eilat, to Egypt as a result of the arbitration. Again, the conflict in Yugoslavia had an adverse effect economically on the shipping and transport industry on the Danube, with very heavy financial loses for countries such as Hungary, Ukraine, Germany, Romania, and Austria, which were not connected with the conflict in Yugoslavia (Egglestone, 1999). The Israeli-Palestinian conflict affects the whole region, especially the economy and political situation of Israel and the Palestinian Authority, but also neighboring countries such as Egypt and Jordan that are negatively affected. Bangladesh, which formed a coalition with India who helped in gaining its independence from Pakistan, is threatening to cancel the Treaty of Friendship with India

Because of the issues of reduced quantities of water and increased salinity in the water, this endangers the existence of millions in Bangladesh.

An increasing number of states are experiencing occasional or lasting water stress, yet in most cases mechanisms and institutions to manage disputes over water resources are either absent or inadequate[13]. Competition over this precious resource could increasingly become a source of tension – and even conflict – between states and sectors. History has often shown that the need for freshwater can cause different users to cooperate, rather than allow confrontations that could jeopardize the water supplies. Water Conflicts can be resolved in various ways:

  • Force: a decision imposed by force on one or more of the parties.[14]
  • Adjudication: a decision rendered by an authority, state, institution, Court of Law, or Special Master. Some states assign a “Special Master” who will act as a judge or arbitrator in water disputes.
  • Negotiation: a decision requiring an agreement among the parties.

The tendency for resolution in the world today is to use interest-based negotiation and mediation, equitable and reasonable use of water, and reach an agreement where the parties will jointly manage the shared water resources.

In the Zambezi River dispute, where eleven countries are involved, they reached an agreement to manage and develop the Zambezi resources jointly. The Vatican played the mediator/facilitator and used its authority to influence the parties and promote an agreement (Milich and Varady, 1998).

The public dispute over water issues in Hawaii was a long and escalating controversy that entailed issues such as protection and control of surface and groundwater, water ownership, and issues of water quality that even the lawmakers could not resolve. Councilwoman Jo Ann Yukimura decided to mediate the dispute, all parties reached a resolution by consensus, and the result was a 75-page code proposal, and a state water agency managing a system of water use permits (Glaser, 1998).

4. CONCLUSION: This underlying philosophy creates a challenge (for water resources managers, governments, local and international NGOs, and national and international institutions) to seek ways of avoiding conflicts if possible, and resolving them amicably and effectively when they do arise. In order to accomplish this, there is a need to raise the capacity of these organizations so that they can better prepare for, and respond to, challenges that arise because of constantly changing circumstances. This capacity is especially critical in areas where there is potential conflict brewing.

If there is goodwill, a desire to avoid confrontation and dispute, and an understanding that all parties can benefit from a strategy of using alternative dispute resolution approaches, there is a real opportunity to reduce the damage caused by conflicts and move from potential conflict to potential cooperation.



  1. Acland, A. F. 1990. Managing Conflict through Mediation. London, Hutchinson Business.

  1.   1995. Resolving Disputes without Going to Court: A Consumer Guide to Alternative Dispute Resolution. London, Random House. Aitken, R.; Brand, M.; Allooloo, T.; McCready, K.; and Grant, J. 1993. Building Consensus for A Sustainable Future: Guiding Principles. Canada, Round tables on Environment.

  1.  Arrow, K.; Mnookin, R. H.; Ross, L.; Tversky, A.; and Wilson, R. 1995. Barriers To Conflict Resolution. London, W. W. Norton.
  2.  Bazerman, M. 1983. Negotiator Judgment: A Critical Look at the Rationality Assumption. American Behavioral Scientist, Vol. 27, No. 2.

  1.  1986. Why Negotiations Go Wrong. Psychology Today, March

  1.  Bazerman, M. and Neale, M. 1993. Negotiating Rationally. New York, Free Press.

  1.  Bercovitch, J. 1984. Problems and Approaches in The Study of Bargaining and Negotiation. Political Science. Boulder, Colo.

  1. 1984. Social Conflict and Third Parties. Westview Press.

  1.  Bercovitch, J. and Rubin, J. 1992. Mediation in International Relations. London, Macmillan.

  1.  Berton, P.; Hiroshi, K.; and Zartman, B. 1999. Justice, Fairness, and Negotiation: Theory and Reality. New York, St. Martin’s.

  1.  Berton, P.; Kimura, H.; and Zartman, W. 1999. International Negotiation, Actors, Structure/Process, Values. New York, St. Martin’s.

  1. Eggleston, R. 1999. Yugoslavia: Danube River Trade Hurt by Conflict.


  1. Global Chaos: Sources of and Responses to International Conflict, Washington, D.C., United States Institute of Peace

  1. Hamer, J. and Wolf, A. 1997. Patterns in International Water Resources Treaties: The Transboundary Freshwater Dispute Database. Colorado Journal of International Environmental Law and Policy 1997 Yearbook.

  1.  Hampson, F. and Hart, M. 1995. Multilateral Negotiations: Lessons From Arms Control, Trade, and the Environment. Baltimore, Md., Johns Hopkins University Press.

  1.  Hampson, F. and Reppy, J. 1996. Earthly Goods: Environmental Change and Social Justice. New York, Cornell University Press.

  1.  Hoffman, D. 1997. Tools of the Trade: A Manual for the Settlement-Oriented Mediator. Harvard Law Review, Spring.

  1.  Hopmann, P. 1995. Two Paradigms of Negotiation Bargaining and Problem-Solving. The Annals of the American Academy of Political and Social Science, November.

  1.  Hunter, J. 1998. Tuman River Area Development Program and Transboundary Water Pollution. http:// www.nautilus.org/papers/enviro/hunter_tumen.html1998

  1.  Hofstede, G. 1980. Culture’s Consequences. Sage.

  1.  Jabbour, E. 1993. Sulha: Palestinian Traditional Peacemaking Process. Montreal, House of Hope.

  1.  Klhon, W. and Andjelic, M. n.d. Lake Victoria: A Case in International Cooperation. http://www.fao.org/ag/AGL/AGLW/webpub/lakevic/LAKEVIC4.htm

  1.  Kramer, R. and Messick, D. 1991. Negotiation as a Social Process. Sage.

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[1] Report of the Secretary-General: Possible Features of a Model Law on International Commercial Arbitration, A/CN.9/207, paras. 29-30.

[2] This is a process wherein parties to the dispute agree to submit their dispute to a neutral party, who will decide their case. Arbitration is the closest form to adjudication. The parties agree on a third neutral party or a panel, to whom they will present their case.


[3] Mediation is a process that employs a neutral/impartial person or persons to facilitate negotiation between the parties to a dispute in an effort to reach a mutually accepted resolution. Mediation is a process close in its premises to negotiation.

[4] Issues such as personal relations, time, sovereignty, face-saving, mode of bargaining, and hierarchy, which are culturally based, need to be considered during negotiations between different nations, societies, and ethnic groups.


[5] All participants should be committed to implementing the agreement and creating a mechanism of effective monitoring to deal with problem that may arise in the near and distant future.

[6] In the process of negotiation between countries, or international entities, one nation often needs to build a coalition with others to achieve its goals. The parties to the coalition do not have necessarily the same interests, priorities, or values, but have some similar objectives.


[7] The desire to reach a resolution to the dispute is an important starting point, an attitude vital for the progression of a process so complex. It manifests the willingness of all the participants to make efforts towards reaching a resolution, even though the parties know that at a later stage there may arise the need for some compromise.

[8] An increasing number of states are experiencing occasional or lasting water stress, yet in most cases mechanisms and institutions to manage disputes over water resources are either absent or inadequate

[9]The ICC offers clients the opportunity to file cases under specific sets of rules, which allow clients to choose where a dispute will be arbitrated as well as provide a mechanism to select a skilled arbitrator or mediator with the appropriate language skills.

[10] It is very important that parties provide for ADR in their contracts before a dispute arises. If the parties do not include an arbitration or mediation clause in their contract, they will have little choice but to use the court system to resolve their dispute. After a dispute arises, it is usually very difficult to agree on ADR.


[11] The psychological attitude of individuals to negotiation, their personal perceptions, past experience, and expectations are manifested in rational or irrational decisions, which have an effect on the outcome of the negotiation.

[12] In some legal systems the courts will not come to the aid of a “foreign” arbitration by way of aiding in the procurement of evidence, granting interim orders of protection or the like.

[13] Many countries along its route use the river Rhine. Pollution of the river has been caused by the chemical industries of Germany, Switzerland, and France, and the shipping industry along the river.

[14] When upstream countries cause the pollution of a river and degrade the quality of the water reaching downstream riparians, water quality and pollution can cause conflicts between the users.