Empowering Mediators in the MENA Region

A major dispute arose between a South Asian manufacturer of home appliances and a Middle Eastern distributor. The two companies had signed a contract worth USD 13.4 million for the shipment of 100,000 units. After only 30% of the order was completed, the relationship deteriorated. The distributor raised concerns about delays in the first shipments and claimed that certain units showed quality inconsistencies. On the other hand, the manufacturer accused the distributor of withholding the second installment of payment, which was clearly outlined in the contract. The disagreement escalated quickly, with both sides threatening to terminate the contract and pursue legal action, putting years of cooperation and trust at serious risk.

How the Mediation Process Was Conducted I was invited to intervene as a mediator to help prevent the collapse of the deal. My first step was to conduct separate intake meetings with both parties, during which I explained the principles of confidentiality, neutrality, and the process we would follow. Each party submitted a written statement summarizing their grievances. These initial discussions revealed the true underlying interests: the distributor was deeply concerned about its reputation in the Middle Eastern retail market if it delivered products with quality issues, while the manufacturer’s priority was ensuring steady cash flow to sustain production and avoid factory disruptions.

When the first joint session began, the distributor expressed frustration about the shipment delays and the risk of damaged credibility with its retail clients. The manufacturer responded strongly, highlighting the significant costs already incurred and the financial pressure from the withheld payment. Both sides initially used accusatory language such as unreliable and bad faith. My role was to reframe these terms into neutral and constructive concerns, translating unreliable partner into need for reliability, and bad faith into need for assurance of commitment. This shift in language helped lower tensions and allowed us to set a clear agenda around three key issues: the release of pending payments, the quality assurance process, and the timeline for completing the remaining shipments.

In the following caucus sessions, I met privately with each party. Using BATNA and WATNA analysis, I guided them through the consequences of litigation compared with negotiated settlement. Both sides realized that going to court would not only drain resources but could also jeopardize their positions in their respective markets. With this understanding, they became more open to negotiation.

During the extended joint negotiation, I introduced tools to facilitate clarity and constructive problem-solving. We developed a shared timeline map that illustrated production, delivery dates, inspection reports, and payment obligations. This visual removed much of the ambiguity that had fueled mistrust. We also used an option-generation matrix to explore different settlement structures, such as staged payments tied to third-party inspection results and revised shipment schedules. At critical moments, I employed structured silence, giving the parties space to process proposals without reacting defensively. This encouraged deeper reflection and made them more willing to explore compromise.

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Tools and Strategies That Proved Helpful:

● Reframing accusatory language into constructive needs.

● BATNA and WATNA analysis to highlight the risks of litigation versus settlement.

● Shared timeline maps to visualize obligations and deadlines.

● Option-generation matrix for structured solutions.

● Strategic use of silence to allow reflection.

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Outcome and Settlement Ultimately, the mediation produced a comprehensive settlement:

● The distributor agreed to release 50% of the pending payment, amounting to USD 2 million, within ten days.

● The manufacturer committed to replacing any defective units verifi ed by a neutral inspection agency.

● A new shipment plan was established, with 20% of the total order delivered every two months, each batch cleared through the inspection agency before payment release.

● A joint review committee, consisting of one representative from each company and an independent auditor, was created to meet quarterly.

● Both sides agreed not to make public statements about the dispute, protecting their reputations and maintaining confidence in both markets.

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The mediation concluded with the signing of a binding settlement agreement. Instead of entering a costly and uncertain legal battle, both sides preserved a lucrative business relationship. Six months later, the shipment schedule was back on track, payments were being made on time, and the distributor extended new purchase orders beyond the original contract. What began as a dispute threatening to destroy trust ultimately became an opportunity to strengthen cooperation through structured mediation.

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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.

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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.

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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.

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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?

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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.

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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.

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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.

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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.

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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.