On 21 May 2011, a new law was issued regarding the mediation of civil matters and enforcing the agreement resulting from mediation (394/2011). This law is a substitute for the old law on mediation of civil matters in state courts. This new law enforces the EU directive 2008/52/EC on certain aspects of mediation in civil and commercial matters.

The purpose of the mediation directive is to enhance the availability of dispute resolution proceedings especially in situations where a cross-border dispute has arisen. The directive is expected to broaden and diversify the supply of mediation services for the new law includes, in addition to the mediation of civil matters, the provisions of enforcing the agreement resulting from a mediation outside the state court.

The directive is not applied to fiscal, customs or administrative matters. Nor is the directive applied in relation to Denmark.

The provisions of mediation in state court were transferred from the old law to the new one practically unchanged. In mediation in state court, the mediator is a state court judge. The parties are allowed to make a petition for the person of the judge but they are not allowed to demand a specific judge to act as a mediator in their case. On the request of the parties, the proceeding can be held non-public. The parties bear their own expenses.

Mediation outside the state court means a structured process whereby two or more parties to a dispute attempt by themselves, on a voluntary basis, to reach an agreement on the settlement of their dispute with the assistance of a mediator. This is aimed to reach a status of a distinct alternative to the mediation in state courts or to trials. The "structured" process means that the mediation must be based on an agreement, rules or other such an arrangement. The mediator should be trained to act as a mediator and practise either privately or within an organisation offering mediation services. The aforementioned organisation should have rules regarding mediation.

The state court can, based on a petition, in a written proceeding, enforce the agreement resulting from the mediation. The enforcement can be done only with the acceptance of all of the parties involved. The agreement resulting from mediation cannot be enforced if it is contrary to law or clearly unreasonable, infringes a right of a third party or is not enforceable as regulated in the Execution Code (705/2007). In other cases, the agreement must be enforced.

The mediators or persons participating in the mediation process are not to be obliged to testify in a civil case for what they have found out during the mediation process. Nevertheless, this does not cover criminal proceedings and it can be agreed otherwise. The amendment has been written into chapter 17, section 23, subsection 1, paragraph 5 of the Code of Judicial Procedure.

The start of a mediation process interrupts the limitation period. The expiration of the period of limitation or filing a suit during the mediation process does not restrict a party of a civil matter from starting legal proceedings or arbitration after the mediation process. The amendment has been written into section 11, subsection 1, paragraph 4 of the Act on Limitation of Debt (L velan vanhentumisesta) (728/2003).

The limitation is interrupted for the period of the proceeding and is restarted when a final judgement or an award is given or when the process has come to an end in some other manner. In mediation in state courts, the limitation is interrupted when the judge makes the decision to start the proceeding. In mediation outside the state court, the limitation is interrupted when an agreement to start the mediation has been done. This provision, nevertheless, does not affect the regulation regarding the limitation periods or time limits deriving from a binding international agreement.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.