FINLAND Law and Practice Contributed by: Tuuli Timonen, Annika Lampela and Tony Chokairy, Dottir Attorneys
Other consensual methods, such as structured settle- ment negotiations or expert determination, may also be used in certain commercial contexts, particularly where the dispute concerns technical or valuation issues. No specific local rules govern these types of proceedings, however. 4.2 Requirements to Engage in ADR Finnish law does not generally require parties to engage in ADR before initiating litigation or arbitra- tion, and the courts do not hold the power to impose court-ordered mediation on parties. Parties are free to commence formal proceedings without first attempt- ing mediation or other settlement mechanisms. However, members of the Finnish Bar are subject to professional rules of conduct which require them, as a general principle, to seek an amicable resolution of disputes where appropriate. In particular, an attorney should not, without a justified reason, initiate legal proceedings without first presenting the client’s claims to the opposing party, allowing a reasonable time for response and providing an opportunity to resolve the matter amicably. Attorneys are also expected to assess, throughout the assignment, whether settle- ment or alternative dispute resolution methods could be appropriate. Parties may also agree contractually to engage in ADR before pursuing litigation or arbitration. Such multi- tier clauses may require negotiation or mediation as a preliminary step in the dispute resolution process. Failure to comply with an agreed ADR step may have procedural consequences, such as a temporary sus- pension of proceedings or consideration in the allo- cation of legal costs. Nevertheless, courts and tribu- nals typically prioritise access to justice and will not permanently prevent a party from pursuing its claims. 4.3 Impact of ADR Engaging in ADR does not generally prevent a party from subsequently initiating litigation or arbitration if a settlement cannot be reached. While parties may agree on multi-tier dispute resolution clauses requiring negotiation or mediation as a preliminary step, such arrangements typically affect the timing or admissi-
bility of proceedings rather than excluding access to litigation or arbitration. Mediation and other ADR processes are voluntary, unless agreed otherwise by the parties. They are also non-binding unless the parties reach a settlement agreement. If the parties successfully resolve their dispute through ADR, the settlement agreement is typically formalised as a binding contract. In court-annexed mediation, the settlement may also be confirmed by the court, which gives it the same enforceability as a court judgment. In arbitration, the parties may request the tribunal to record the settlement in an award by consent, which gives the settlement the status and enforceability of an arbitral award. 4.4 Timing of ADR ADR may take place at any stage of a dispute in Fin- land. Typically, parties attempt negotiations or media- tion before initiating formal proceedings. This is often motivated by the desire to resolve the dispute quickly and preserve commercial relationships. However, ADR may also occur during ongoing court proceedings or arbitration. Arbitral tribunals may also support settlement discussions where appropriate. Engaging in ADR does not automatically suspend or interrupt limitation periods. Unless otherwise agreed or provided by law, parties must ensure that limitation periods are preserved, for example, by initiating formal proceedings if necessary. 4.5 Confidentiality Confidentiality is a central feature of most ADR pro- cesses in Finland. Mediation (private, court-annexed, institution-based) is generally conducted on a con- fidential basis, and the mediator is bound not to disclose information obtained during the process. Statements made during mediation are generally not admissible as evidence in subsequent proceedings without the parties’ consent, and settlement offers may not be used as such evidence.
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