East is East and West is West? : A Cross-Cultural Study on the Impact of Culture on Behavior in Commercial Dispute Resolution

Abstract: The purpose of this thesis was to investigate the attitude towards law in the West and the Far East, the perceptions of dispute resolution methods in a cross-cultural context, and difficulties that may arise when doing business in other cultures than your own, especially with regards to commercial dispute resolution. Due to the main ideologies, the people’s relationship to the Law is considerably different in the Western society than in the Far East. In a cross-cultural conflict, this contributes to the difficulty of understanding each other’s point of view. Through interviews, and studies of laws and doctrine, I have found that the choice of dispute resolution method, is usually made with regards to the parties’ interests, and influenced by their legal and cultural heritage. As we project our own values, thoughts and feelings onto others, we enter into negotiations with an expectation that the other party will behave a certain way. How we react in situations and how we deal with them, is based on our life experiences and cultural references, in which we have been indoctrinated since birth. Thus, with mutual respect and understanding, the parties to a cross-cultural relationship can create their own business sub-culture and establish common norms, which will facilitate their relationship and provide business success. Due to globalization, many companies nowadays do business worldwide. Although dispute resolution methods and procedural laws have been harmonized in many countries, the execution of these laws still seems to be connected to the culture. Therefore, when it comes to dispute resolution methods in a cross-cultural dispute, due to cultural differences one might have to consider other options, such as mediation, instead of the Western traditional ones, such as litigation or arbitration.