Conciliation

Meaning
Conciliation is a process in which a third party assists the parties to resolve their dispute by agreement. A
Conciliator may do this by expressing an opinion about the merits of the dispute to help the parties to reach a
settlement. Conciliation is a compromise settlement with the assistance of a Conciliator. Conciliation in the
sense of ironing out mutual differences by mutual discussion and correspondence is a routine process not
uncommon in the business world.

Conciliation is a voluntary and non-binding process in comparison to Arbitration and Litigation. Any party may
terminate Conciliation proceedings at any time even without giving any reason. The other important difference
is that the parties control the process and outcome of the dispute, which is not the case in Arbitration as well as
litigation. Conciliation is a consensual process whereas Litigation and Arbitration solemnly urge the parties for
an amicable reconciliation and have no control on the outcome of the dispute or the process.

Role of a conciliator

 Hold meetings with each individual party to discuss how the meeting will go
 Review relevant documents and information to help reach conclusions
 Maintain a neutral position within a meeting to ensure both parties receive fair considerations
 Allow parties involved to reach their own resolution 
 Be prepared to settle disputes by issuing their own resolution, should the parties ask
 Meet with witnesses and other persons related to the parties to obtain statements and additional
information about the dispute in question
 Prepare settlement agreement documents based off of the resolution the parties reached
 Practice confidentiality regarding the parties, their personal information and details regarding
the dispute

According to section 63 of the Act, there could either be a sole conciliator or two or three conciliators,
according to the wishes of the parties. In case of more than one conciliator, they shall work jointly and in
cooperation with each other,

According to section 64 of the Act, to conduct the proceedings of the conciliation, the parties may appoint the
conciliator or conciliators, if there are more than one. When there are three conciliators, the parties shall appoint
the two conciliators and they, in turn, shall appoint the third conciliator. In the second part, the Act stresses that
the parties may take the assistance of a third party or institution in regards to the appointment of the
conciliator/conciliators. Such party may directly appoint the conciliator or recommend his/her name to the
parties for appointment. The condition that has been attached to this clause is that while making the
appointment, such party or institution shall keep in mind such considerations as are required to ensure the
neutrality and independence of the conciliator. Also, the section stresses upon the fact that the parties and the
conciliators should not be of th same nationality.

According to section 67 of the Act,

 The conciliator shall maintain his independence and impartiality and persuade the parties in a way to
help them reach an amicable settlement.
 The conciliator should not only uphold the principles of objectivity, fairness and justice but should also
keep in mind the rights and obligations of the parties and various circumstances surrounding the
dispute.
  The conciliator may conduct the proceedings of the case in a manner that is appropriate in his opinion.
However, he should consider the circumstances leading to the case and the wishes of the parties or any
other requests of the parties that are related to the subject of the dispute and are reasonable in the eyes of
the law.
 A settlement of the dispute can be proposed by the conciliator at any time when the proceedings are still
in force. Any such settlement proposition need not be in writing or accompanied by a statement of
reasons, necessarily.
 According to section 69 of the Act, the conciliator may communicate with the parties orally or in
writing. The communication could take place either individually or in groups as suits the needs of the
proceedings. The place of such meeting shall be decided by the conciliator in consultation with the
parties.
 According to sections 70 ad 75, confidentiality should be ensured from the ends of both the conciliator
as well as the parties. No information should be passed on to a third party except in cases of
enforcement or implementation of the conciliation proceedings.
 According to section 80 of the Act, a conciliator should not be an arbitrator or a representative of the
parties in any kind of legal proceedings in respect to a matter that is subject of the dispute. He/she also
cannot be presented as a witness for/against the parties in any arbitral or judicial proceeding.

Conciliation process in India

The conciliation proceedings are initiated by one party sending a written invitation to the other party to
conciliate. The invitation should identify the subject of the dispute. Conciliation proceedings are commenced
when the other party accepts the invitation to conciliate in writing. If the other party rejects the invitation, there
will be no conciliation proceedings. If the party inviting conciliation does not receive a reply within 30 days
from the date he sends the invitation or within such period of time as is specified in the invitation, he may elect
to treat this as rejection of the invitation to conciliate. If he so elects he should inform the other party in writing
accordingly.

2) Submission of Statement to conciliator [ Sec 65]

The conciliator may request each party to submit to him a brief written statement. The statement should describe
the general nature of the dispute and the points at issue. Each party should send a copy of such statement to the
other party. The conciliator may require each party to submit to him a further written statement of his position
and the facts and grounds in support. It may be supplemented by appropriate documents and evidence. The party
should send a copy of such statements, documents and evidence to the other party. At any stage the conciliation
proceedings, the conciliator may request a party to submit to him any additional information which h may deem
appropriate.

3) Conduct of conciliation proceedings [ Sec 69 (1), 67(3)]

The conciliator may invite the parties to meet him. He may communicate with the parties orally or in writing.
He may meet or communicate with the parties together or separately. [Sec 69(1)]

In the conduct of conciliation proceedings, the conciliator has some freedom. He may conduct them in such
manner as he may consider appropriate. But he should take into account the circumstances of the case, the
express wishes of the parties, a party’s request to be heard orally and the need of speedy settlement of the
dispute. [ Sec 67(3)]

4) Administrative assistance [ Sec 68]

Section 61: Application and Scope

There shall be one conciliator. But the parties may by their agreement provide for two or more conciliators.
Where the number of conciliators is more than one, they should be as a general rule act jointly.

Section 64: Appointment of Conciliators

Sub-section (1) of Section 64 provides three rules for the appointment of conciliators:

1. If there is one conciliator in a conciliation proceeding, the parties may agree on the name of a sole conciliator

2. If there are two conciliators in conciliation proceeding, each party may appoint one conciliator

3. If there are three conciliators in a conciliation proceeding, each party may appoint one conciliator and the
parties may agree on the name of the third conciliator who shall act as the presiding conciliator.

Sub-section (2) of Section 64 provides for the assistance of a suitable institution or person in the appointment of
conciliators. Either a party may request such institution or person to recommend the names of suitable
individuals to act as conciliators, or the parties may agree that the appointment of one or more conciliators be
made directly by such institution or person.

The proviso to Section 64 requires that in recommending or appointing individuals to act as conciliators, the
institution or person shall have regard to such considerations as are likely to secure the appointment of an
independent and impartial conciliator with respect to a sole or third conciliator, the advice ability of appointing
a conciliator of a nationality other than the nationalities of the parties should be taken into account.