On the 3rd of April 2025 the new Organic Law 1/2025 on Appropriate Means of Dispute Settlement (Medios Adecuados de Solución de Controversias) (hereinafter the “New Law”), whose principal objective is to encourage the use of alternative means of dispute resolution (hereinafter, “MASC”), will come into force. This reform comes as a response to the increasing congestion in Spanish courts and to the necessity to offer quicker and more efficient solutions to the public.
Among the most prominent MASCs are mediation, conciliation and arbitration: methods that allow the parties involved to resolve their conflicts outside the courts, in a less formal environment and with more control over the process. The reform is part of a wider plan to modernise a Spanish judicial system which is overloaded with cases and lacking specialisation in certain areas. For more information about the updates to the New Law in relation to specialisation and reorganisation of the courts you can consult our recent article GOODBYE TO SINGLE-JUDGE COURTS.
Among the most relevant changes to the New Law is the obligation to try to resolve disputes through a MASC before initiating legal proceedings, except in exceptional cases specified in this New Law. This is intended, where possible, to avoid court proceedings and, as a consequence, reduce the current saturation of the courts in our country. With MASCs an effective alternative to the traditional judicial justice system is sought, one which is more accessible, cost-efficient and streamlined.
MASCs, in the majority of cases, are quicker and more affordable proceedings than the traditional judicial ones. These mechanisms will probably avoid the judicialisation of certain conflicts, allowing the parties to reach an agreement directly, under the supervision of a specialised mediator or arbiter. However, the jury is still out on whether the impact, a priori, will be sufficient to speed up the legal proceedings that are initiated, given that, although MASCs are more cost-effective than traditional judicial proceedings, they require an adequate infrastructure and an appropriate budget allocation which, for the time being, has not been approved by the Government.
Mediation is one of the most prominent tools in this framework and is characterised by the intervention of an impartial third party that facilitates communication between the parties so that they reach an agreement. Although mediation does not oblige either of the parties to reach an agreement, it offers a safe space for negotiation and the amicable resolution of conflicts. Furthermore, mediation has the advantage of preserving relations between the parties which is especially useful in commercial or family disputes. On the other hand, arbitration is another of the principle methods set forth in the New Law. In arbitration, the arbiter decides the result of the conflict, and the parties must comply with the decision, which has the same validity as a court ruling. This mechanism is especially useful in corporate and civil conflicts, in which the parties prefer an enforceable and final decision.
An important challenge of the New Law will be the effective implementation of these alternative mechanisms, because in many cases the parties involved in conflicts are not familiar with these methods nor are they prepared to reach an agreement. Therefore, extensive awareness-raising and training will be required, both on a judicial level and between legal professionals and the general public so that its implementation effectively and positively influences the processing and resolution of proceedings.
In short, Organic Law 1/2025 represents an ambitious attempt to modernise the Spanish judicial system through the promotion of “Appropriate Means of Dispute Settlement” (MASC). However, its actual effectiveness will depend upon various factors: the existence of an adequate infrastructure, investment in training and awareness-raising and the parties’ willingness to adopt these measures. Whilst the reform may help to reduce the judicial burden, it is not an immediate or guaranteed solution. With the necessary resources and commitment, MASCs may become merely a bureaucratic obstacle before litigation, instead of a truly effective alternative to traditional justice.
Julio González
Vilá Abogados
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28th March 2025
