Summary

Standing neutrals are a neutral, trusted, and independent party selected by parties at the outset of a contractual relationship with the remit of assisting the parties to resolve any issues or disputes which may arise. Although not especially common in any jurisdiction(but most used in the Nordics and in the USA), using standing neutrals to facilitate good commercial relationships between counterparties may be of interest where a long-lasting relationship is planned and keeping good relationships will be key to achieving a joint mission.

Standing neutrals may be especially helpful in circumstances where there is an imbalance of power between contracting counterparties. Often, where there is an imbalance of power at the outset of a relationship, expectations can be misaligned and crucial conversations necessary to embed mutual understanding are missed. A standing neutral can assist to address any imbalance by supporting the parties and ensuring that issues are addressed early - before they grow to become full-blown disputes.

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