The Italian Mediation Reform: Elements and Perspectives

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Speaking about mediation in Italy can be harder than it seems. Because – with the development, the regulations, and the peculiar implementation of the legislation – the risk is providing an inaccurate scenario of trends and data in the country.

On the other hand, it is also worth noticing that – since 2010, with the introduction of the legislative decree 28/2010, the Italian experience has provided mediators and lawyers all over the world an interesting and thought-provoking view of what could be the effects of mandatory mediation procedures. At least at surface level, the combination of mandatory sessions, enforceable agreements, and tax incentives seemed to offer an ideal scenario to mediation aficionados worldwide. Unfortunately, the situation has become more complicated. And to understand it requires a quick retrospective.

Before 2010, the mediation in Italy was on an entirely voluntary basis. The scenario radically changed with the legislative decree 28/2010, when it became mandatory for specific matters. The introduction of mandatory mediation represented a Copernican revolution for the Italian civil Justice system, and caused a lot of turmoil, mainly from lawyers and bar associations. After a declaration of unconstitutionality for a defect of form[1], it was newly introduced in 2012, with three significant amendments[2]. The change of the mandatory mediation in a mandatory first meeting[3]  (most of the times just a brief meeting regarding pros and cons of mediation), the reduction of the areas of application (including the exclusion of most civil and commercial disputes), and the possibility for lawyers of becoming civil and commercial mediators with a short, 18-hour, course. Moreover, the direct enforceability regarded only agreements signed by both parties and respective lawyers. The legislator, indeed, had to balance several elements, including the lack of awareness regarding the procedure, a highly litigating country, a considerable number of litigation lawyers not very interested in adr, the willingness of most of legal professionals to obstacle mediation (delaying time for litigation was considered as a limitation of access to justice), cost-cutting pressures regarding the Court system, and – at the same time – the willingness to spread the seeds of adr. It is also worth mentioning that the aforementioned regulation did not take into account mediations/conciliations in criminal, labor, and family procedures – all of which were (and are) regulated by specific rules. 

In all these years most of the delicate issues have been smoothed, mainly because of two factors: judges who started deferring parties of mediation and boost of online procedures due to the pandemic. We would also argue that a mandatory first meeting allowed parties and lawyers a better view regarding the pros and cons of the procedure.

The recovery fund, and the willingness to provide Italy and European union a strong restart after the pandemic crisis, forced the government to introduce a long-awaited reform of the entire justice system. The idea is not only related to administrative reasons, but also to cost-saving measures, and better spending/management of resources. It is not – in this article – our intent to analyze in detail all the elements of the reform, but to provide a full rounded comprehensive view of the main elements regarding mediation.

The condition of admissibility. Widening of subjects

The matters for which decree 28/2010 had already provided the condition of admissibility were: condominiums, real estate, property divisions, hereditary successions, family agreements, leases, loans, company rentals, damages arising from medical and health liability, defamation via press or other means of advertising, insurance, banking, and financial contracts. The reform added the following matters: joint venture agreements, syndicates, franchising contracts, contracts for services, partnership companies, and subcontracting.

This broadening of the spectrum highlights a greater confidence from the legislator regarding the effectiveness of the procedure. Moreover, it is possible to notice a slight shift towards corporate law.

Standardization of videoconference mediation    

An important novelty of the reform is certainly the standardization of videoconference mediation, which in the previous regulation was foreseen only in exceptional cases. Strengthened by the experience gained during the pandemic period (which had considerably accelerated the process of digitalization and adaptation to new telematic tools), the legislator decided to boost a tool which allows, every day, to carry out hundreds of procedures without moving parties, lawyers, and mediators.

Regarding digitization, the legislator also obligated mediation centers to comply with the digital administration code, which requires a specific form of conservation of all the documents (on dedicated servers with certain technical characteristics) and provided detailed technical requests for electronic signatures.

Mandated mediation (by the Judge) at any time of the judicial procedure

The reform strengthened this possibility and, in a certain sense, boosts it. At any time up to the entire appeal procedure, the Judge, if she believes it is a good option, can send the parties to mediation.

It is worth to stress that the requested mediation must be understood, to all intents and purposes, as a mandatory mediation, and not as a mandatory first meeting.

To better specify the extent of the rule, when the Judge orders the parties to go back to mediation, she schedules a verification hearing after 6 months (in theory, the maximum length for the mediation procedure) and – if at the aforementioned hearing, the mediation is not completed – she declares the inadmissibility of the judicial request[4].

Personal presence of the parties, consequences of non-participation, and mediator’s proposal

One of the key elements of the reform is the mandatory presence of the parties during the procedure.

As explained before, many lawyers/parties were practically forced to participate in the first mediation meeting because of the condition of admissibility. This meeting was – in practice –not a real mediation but a purely informative meeting in which the parties decided whether to enter into the merits. Often these first meetings were seen merely as an obligatory step to be able to access the Court without any interest in the actual development of the procedure and lawyers were used to participate without parties (with a proxy), thus completely distorting the essence of the procedure.

Already in the previous text, pre-reform, the presence of the parties was emphasized with the provision of specific consequences (non-fulfillment of the condition of admissibility, declaration of inadmissibility of the case, pecuniary sanctions, chargeability of Court costs). The reform has further penalized the parties who do not want to actively participate in mediation[5].  Moreover, the legislator has not only emphasized personal participation in the mediation but has condemned the absence of the parties if not for justified (documentable) reasons.

Another very interesting topic is the proposal of the mediator that, before the reform, was foreseen only if both parties expressly requested it. The legislator has now determined that: “When the agreement is not reached, the mediator acknowledges it in the report and can formulate a proposal for conciliation to be attached to the report“. With this passage, the mediator earned wider discretionary power.

Mediation duration. Timeline expansion

With respect to the duration of the procedure, it was specifically determined that it cannot be more than 6 months. Now the duration is 3 months, which can be extended, once and with the written consent of the parties, for further 3 months.

Elimination of the first informal meeting

A truly groundbreaking change for Italian mediation is the elimination of the first purely “informative” meeting. The reform provides that the first meeting becomes, to all intents and purposes, a mediation meeting for which it is recognized, regardless of the outcome, a fee (to date it is not yet known if the amount of the compensation that will be indicated with an implementing decree or a ministerial circular).

This modification will change, once and for all, the management of mediation and its costs. Hopefully, the work, preparation, and professionalism of the mediators will be rewarded with an economic contribution[6].

Tax credits (incentives)

In order to strengthen the adoption of mediation, the legislator has provided a series of tax incentives (partly already present, but little used due to lack of funds expressly allocated for this purpose). More precisely, the reform indicates that: “When (..) an agreement is reached, the parties are granted a tax credit commensurate with the indemnity paid (..). up to the amount of six hundred euros. In cases in which the condition of admissibility is foreseen and when the mediation is demanded by the judge, the parties are also recognized a tax credit commensurate with the fee paid to their lawyer for assistance in the mediation procedure, within the limits set by the forensics tables and up to the amount of six hundred euros. The expected tax credits (….) may be used by the party within the overall limit of six hundred euros per procedure and up to a maximum annual amount of two thousand four hundred euros for natural persons and twenty-four thousand euros for legal persons. If the mediation fails, the tax credits are reduced by half. It is provided a further tax credit commensurate with the Court fee paid by the party in the judgment following the conclusion of a conciliation agreement, within the limit of the amount paid, and up to the amount of five hundred and eighteen euros”.

Conclusions

Someone says that the devil is in the details, and this may be true in this case as well. While we look positively the idea of expanding the list of subject matters, strengthening tax incentives, widening mediation proposals, and providing a stronger role of the parties, it is undeniable that a good amount of the success of this reform will be related to the implementation procedures. 

It is also worth stressing that we lost a good possibility to provide mandatory mediation in matters which – in other countries – have been managed with mediation procedures since many years, namely labour and commercial disputes (in the broader sense).

If there is one element that still lacks in Italy is a profound mediation culture, and this reform could and should have done more in terms of mediation awareness. On the other hand, it is worth noticing the positive trend and the willingness to invest in a strong and effective tool.

Our Italian background suggest us to look at a half-full glass. More parties and lawyers are starting mediating and seeing the benefits of the procedure. Let’s hope for a strong and effective adoption.

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[1] The mediation was introduced with a legislative decree (a government act), and the Italian Constitutional Court indicated that the reform needed a parliament approval. The main reason was that the matter was so relevant for the life of citizens that it needed to pass through the approval of the parliament and being emanated as a law. 

[2] At this moment, if the potential dispute concerns certain specific matters, the parties must go through mediation before filing a civil case. This provision has been named “condition of admissibility” in the sense that if the parties do not provide for this fulfillment, the Judge, in the first hearing, sends them back to mediation.

[3] As we will indicate later, the mandatory first meeting does not have to be intended as a mediation per se. It is a short (20, 30 minutes session) that is provided for free by the mediator. During the first meeting, the mediator explains how the mediation works and what the benefits for the parties are. If the parties agree to start the procedure, they will enter into the merits.

[4] This passage of the reform shows how, in Italy, the mediation procedure is not seen exclusively as an alternative to litigation, but as a complementary procedure at the service of litigation.

[5] “From the failure to participate without justified reason in the first meeting of the mediation procedure, the judge can infer proof arguments in the subsequent judgment”. In the second paragraph: “When mediation constitutes a condition of admissibility, the judge condemns the constituted party who did not participate in the first meeting without justified reason to pay a sum corresponding to double the court fee due to the state budget for judgment”. And finally: “… the judge, if requested, may also order the losing party who did not participate in the mediation to pay the counterparty a sum equitably determined in an amount not exceeding the maximum costs of the proceedings accrued after the conclusion of the mediation process”.

[6] One thing worth to be stressed is that this meeting was provided for free. Actual payment of the fees only started with the formal opening of the mediation