Arbitration And Mediation Agreement Template for Malaysia

An Arbitration And Mediation Agreement is a legally binding contract that establishes how you and other parties will resolve disputes outside of traditional court proceedings. Under Malaysian law, this agreement provides a structured framework for alternative dispute resolution, combining both mediation and arbitration processes to handle commercial conflicts efficiently and confidentially.

When do you need this document?

You should implement this agreement when entering into significant commercial relationships where disputes may arise. This includes joint ventures, partnership agreements, supply contracts, construction projects, and international business deals. The agreement is particularly valuable when you're working with government entities, state-owned enterprises, or public listed companies in Malaysia, as it provides a neutral forum for dispute resolution. You'll also need this document when establishing ongoing business relationships where maintaining professional rapport is crucial, as mediation and arbitration processes are generally less adversarial than court litigation.

Key legal considerations

Your agreement must clearly define the scope of disputes covered, specifying whether all disagreements or only certain categories fall under the alternative dispute resolution process. You need to establish a two-tier system where mediation is attempted first, followed by arbitration if mediation fails. The document should specify timeframes for each process, appointment procedures for mediators and arbitrators, and the governing rules for proceedings. Confidentiality clauses are essential to protect sensitive business information shared during the process. You must also address the enforceability of decisions, particularly arbitral awards, and include provisions for interim measures when necessary. Consider including emergency arbitrator provisions for urgent matters that cannot wait for full tribunal constitution.

Legal requirements in Malaysia

Under Malaysia's Arbitration Act 2005, your agreement must be in writing and clearly express the parties' intention to submit disputes to arbitration. The agreement should specify whether domestic or international arbitration rules apply, with international rules governed by the UNCITRAL Model Law provisions within the Act. You must designate the seat of arbitration, which determines the procedural law and supervisory court jurisdiction. The Mediation Act 2012 requires that mediation agreements include provisions for mediator qualifications, confidentiality obligations, and the process for transitioning to arbitration if mediation fails. Your agreement should reference the Asian International Arbitration Centre (AIAC) rules if you choose institutional arbitration, as this provides established procedures and administrative support. The document must comply with the Courts of Judicature Act 1964 regarding court intervention limitations and enforcement procedures for arbitral awards.