Regulatory Robustness Rating in Practice

Yes, here it is. The final part of the Regulatory Robustness Rating (RRR) trilogy. For those of you who are just picking up the RRR topic for the first time, you might like to check out Part 1 andPart 2 first.

You will recall that the aim of the Rating System is to offer an indication of the regulatory robustness of a jurisdiction in relation to cross-border mediation. It is not an indicator of the popularity of mediation or the amount of practice in a jurisdiction. The RRR takes the perspective of mediation users, i.e. what is likely to be important for parties and their legal advisers in assessing the how mediation is regulated in a given country.

In this post, Part 3, I will focus on apply the RRR System with the help of fellow blogger, Sabine Walsh. We will apply the System to Ireland. In other words, we will examine the regulatory robustness of cross-border mediation in Ireland.

You will recall from Part 2, that there are 12 criteria to consider. For each criterion in awarded a star rating of up to five stars. However because not all criteria are equal from a user’s perspective, they are weighted. Each criterion has a weighting of either one, two or three with three indicating that the criterion usually holds greater importance from a user perspective.

Before we get to the actual Regulatory Robustness Rating, let’s start with a few comments about cross-border mediation in Ireland.

Ireland is an excellent example of a jurisdiction where regulation of mediation is having to catch up with practice. A variety of factors including the impact of the economic crisis and a gradual but fundamental change in dispute resolution culture have contributed to the increased use of mediation in a range of different forms of disputes. The courts, in particular, have played a significant role in this development, enthusiastically using what few regulatory powers they have to divert cases into mediation and generally creating an environment conducive to mediation.

These developments have all taken place in the absence of a coherent comprehensive regulatory framework for mediation, or perhaps in the shadow of the promised reforms which have been pending for a number of years now. The RRR highlights the strength of areas such as mediation infrastructure and services, the relationship of the courts with mediation services and the court’s positive attitude to mediation. Regulatory areas desiring high levels of flexibility such as insider-insider confidentiality also score highly on the star scores. However in terms of transparency and clarity of content of mediation laws, we see a different story. The laws on insider-outsider and insider court confidentiality suffer from a lack of certainty and predictability. While the long awaited Mediation Bill, if it is enacted, will certainly increase the regulatory robustness rating of Ireland’s framework, it will be interesting to see whether it has the same impact on boosting the use of mediation as the change in culture, and the tireless efforts of numerous bodies and institutions to raise awareness of mediation have.

The RRR for Ireland is set out in the table below. You will notice that there are four columns. The first column identifies the criterion. The second column describes the application of the criterion in the given jurisdiction. This is a very brief and basic description that enables the RRR to be presented in a tabular form so that readers can benefit from an overview of the jurisdiction’s regulatory framework. The third column shows the star rating (from 1 to 5) and also indicates the weighting given to the criterion. The fourth and final column multiplies the star score and the weighting to come up with the RRR for that criterion. This way readers can see how the various calculations have been made. Should the situation arise where users place particular importance on a certain criterion and less on others, they are able to adjust the weighting to suit their needs and this will give them an ultimate rating that better reflects their needs and interests.

You will note that there is no single final score. There is a good reason for this. If you conducted the RRR analysis with say four countries and gave each an ultimate rating, then less attention would be paid to the individual criteria. Further, the RRR would turn into a competition and countries would be ranked by their overall score only. The RRR is not a competition. It’s a tool for analysis and it’s important to look at the individual criteria and the star scores and weightings allocated to each one. Then if you are still interested in finding out more about that country, you have a framework for doing so, and you know what to look for.

So let’s take a look at Ireland.

Remember the RRR System offers an indication not a comprehensive analysis. It gives users a helpful starting point for finding and analysing the law applicable to cross-border mediation in any jurisdiction.

For example, if you are a lawyer looking to identify suitable laws for your mediation clause, you might use the RRR System to identify three jurisdictions with high regulatory robustness ratings. The RRR System should not be the only indicator in making an informed choice about the governing law and jurisdiction. But it might provide a starting point for you to do some further research to look more closely at these jurisdictions for the purposes of identifying governing law and jurisdiction for your mediation clause.