What is ADR

ADR stands for 'Alternative Dispute Resolution' and pertains to the growing trend initiated in the USA in the 1970s and then later in Europe to resolve business and other disputes through methods other than the adversarial process (court or arbitration cases). Mediation is foremost among these alternative methods of resolving disputes.
The term ‘Alternative Dispute Resolution’ (ADR) is normally used to describe a range of dispute resolution mechanisms such as arbitration, mediation, and other less frequently used methods. The most two common forms of ADR are mediation and arbitration. Mediation is characterized by the use of a “neutral” third party, the mediator, either to mediate a specific dispute between two parties or to reconcile their relationship. The most important difference between arbitration and mediation is that the mediator can not impose a decision on the parties and does not have the authority to rule on a settlement. Instead, the mediator offers a neutral view on the dispute to the two parties and tries to help both parties find an amicable solution. Arbitration systems, on the contrary, authorize a third party, the arbitrator, to resolve the controversy by a binding award.

ADR system offer disputes a chance to avoid the often long and expensive process of taking a case through the formal judicial system. Mediated solutions are generally faster, less expensive, and more likely to allow the parties to return to doing business with one another. ADR has long been an important part of dispute resolution in many developed countries and are becoming increasingly important in developing countries as these countries attempt to reform their judicial systems.

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