Mandatory ADR in Spain: an opportunity for amicable dispute resolution?

The length of court proceedings has been a significant concern in Spain for some time, due to the lack of a culture of amicable resolution. This led to a trend where litigants initiate their disputes directly in national courts right from the outset, resulting in an increase in the number of cases and delays in the delivery of judgments. 

The fact that Alternative Dispute Resolution (ADR) provides a more flexible, timely and cost-effective resolution process in contrast to national courts, is widely recognised. These advantages have gained significant attention in Spain recently. 

The Organic Law

On 2 January 2025, Spain approved Ley Orgánica 1/2025, or the Organic Law, which introduces several measures aimed at improving the efficiency of the public justice system. One of its main objectives is to modernise the Spanish justice system and ensure the swift resolution of disputes, in response to the growing reliance on litigation rather than ADR methods. 

The Organic Law will generally come into effect on 3 April 2025, and one of the key changes this Law introduces pertains to ADR in civil and commercial matters, including international disputes. However, labour, criminal and bankruptcy matters, as well as any cases involving a party that is a public sector entity, are excluded from its scope. 

Rather than specifying a particular type of ADR falls under its provisions (although perhaps mediation is the preferred method), the Organic Law simply requires that the ADR process meets the following criteria:

• negotiation activity.
• recognition under national or regional Spanish Law.
• parties must attend in good faith.
• the objective is to find an extrajudicial solution between the parties or with assistance of a neutral third party.

Implications of Mandatory ADR

One of the key and controversial aspects of the Organic Law is the introduction of mandatory ADR. Specifically, the Organic Law establishes a procedural requirement to first attempt ADR before a claim can be admitted. This requirement applies in civil, commercial and social jurisdictions. However, cases involving the protection of fundamental rights, sensitive family conflicts, proceedings for the adoption of judicial measures for people with disabilities, and disputes related to minors and emergency situations - such as precautionary measures or immediate execution - are excluded from prior mediation. 

The above-mentioned procedural requirement will be considered fulfilled if mediation, conciliation or the neutral opinion of an independent expert is sought beforehand, if a binding confidential offer is made, or if any other type of negotiation activity is used. It is also important to note that the requirement for procedural admissibility will also be fulfilled when the negotiation activity is carried out by the parties or their lawyers, and when the parties have resorted to a collaborative law process. 

The initiative to attempt ADR may come: (i) from the parties themselves; or (ii) order from the Court or Administration of Justice. However, this requirement will not be necessary if, for example, a party was to apply for an interim measure before issuing a claim.

Furthermore, the Organic Law requires the parties to provide proof, in the form of a certificate, that ADR has been attempted. The content of this certificate will vary depending on whether a neutral third party was involved.

Failure to comply

The consequences of failing to comply with the above-mentioned requirements cannot be ignored by parties litigating in Spain. Failure to comply with them will result in the claim not proceeding. Additionally, the request by one party to attempt ADR will interrupt the limitation period from running or suspend the expiration of an action from the date on which the attempt to communicate such request to the other party is recorded at the personal address or place of work known to the requesting party, or through the electronic communication means used by the parties in the prior relations. For clarity, an action will not be permanently interrupted or suspended, but will remain suspended until a settlement agreement is signed or when the ADR process concludes without an agreement.

Additionally, the Organic Law introduces changes in the matter of costs. In particular, the refusal of a party to engage in ADR will be a factor that the court considers when assessing costs. 

One of the important features of mediation is its voluntary nature, meaning the power given to the parties that allows them to have control over it by choosing when to being or terminate the process and to choose the mediator. This principle is recognised in the Organic Law.

The introduction of mandatory mediation has been criticised for creating a situation where mediation imposed by law cannot be interpreted as true mediation. When you request the parties to initiate mediation before going to court, it creates a series of circumstances that we would not find in a voluntary mediation and will undermine its success, such as where the parties will not be willing to go to mediation as they prefer to litigate, or the fact they have to go through mediation before the case can be heard in court is violating their access to justice. 

If we focus solely on the voluntariness aspect of mediation, such a criticism may be valid. However, the concept of mediation is wider as it also includes the lack of pressure on the parties to necessarily reach an agreement, as well as the power to produce a result. 

A growing culture of mediation in Spain

When we refer to mandatory mediation, the dispute is still being dealt with through mediation. What mandatory mediation exactly does is that it eliminates the will of the parties to access mediation, but at the same time preserves their control over the outcome by freely deciding whether an agreement will be reached. 

Arguably, the introduction of mandatory ADR in the Organic Law makes sense in Spain. As mentioned earlier, there is little culture of an amicable dispute settlement culture in Spain, and mediation is still in its infancy compared to other countries. Therefore, mandatory mediation could provide the impetus that the parties need to resolve their dispute by mediation and help them become more familiar with the process. 

The Organic Law presents a valuable opportunity for Spain to foster a culture of amicable dispute resolution, similar to that in countries like the UK or the USA. However, one of the challenges that Spain will need to address to ensure the success of mandatory mediation, is the lack of resources and infrastructure. Without adequate resources, there is a significant risk that, instead of assisting the quick resolution of disputes, the process will prolong the litigation process, which is precisely one of the various issues the Organic Law aims to resolve.