The emergence of disputes among individuals in human societies is inevitable; accordingly, legal systems have consistently sought mechanisms for the peaceful resolution of such disputes. In this regard, conciliation and mediation have long been recognized in the Iranian legal system as important and community-based means of dispute resolution. However, the development of these institutions in recent decades has no longer been confined to their private-law function. Rather, judicial and legislative policies of the country—aimed at reducing the caseload of courts, strengthening restorative justice, and promoting social peace—have played a decisive role in shaping the contemporary legal structure and functions of these institutions.

Nevertheless, governmental intervention and policy-making based on dejudicialization have given rise to challenges concerning the traditional position of these institutions within private law. Such challenges include ambiguity regarding the legal nature of conciliation agreements, conceptual overlap between conciliation and the contract of settlement (ṣulḥ), alterations in the legal effects of the judicial settlement report provided for in Article 182 of the Civil Procedure Code, and the weakening or, in some instances, the strengthening of party autonomy as a result of mandatory or incentive-based policies adopted by the judiciary. This situation has emerged at a time when conciliation and mediation, within overarching judicial policies, have increasingly assumed an instrumental function aimed primarily at reducing the inflow of cases, while the coherence necessary in statutes and by-laws to consolidate the legal status of these institutions is, at times, lacking.

Previous studies have largely focused on introducing the mechanisms of mediation and conciliation and have paid comparatively little attention to an analytical assessment of macro-level policy-making, or to the practical challenges and implementation deficiencies affecting these institutions. This research gap is particularly evident in the distinction between contractual conciliation and judicial conciliation, in the examination of the legal nature of the judicial settlement report, and in the role of non-judicial bodies in quasi-judicial processes.

Adopting an analytical approach, the present study examines the impact of Iran’s judicial and legislative policies on the nature, legal effects, and validity of private agreements in the fields of conciliation and mediation, and addresses the following question: what challenges has state intervention in regulating these institutions created with respect to their demarcation from classical institutions of civil law? The findings indicate that the fragmentation of legislation, ambiguity regarding the legal effects of the judicial settlement report, the delegation of decision making functions to non-judicial bodies, and the absence of clear standards for distinguishing private conciliation from judicial conciliation constitute some of the most significant existing shortcomings.

Finally, while evaluating the current policies, the article offers proposals aimed at restoring conciliation and mediation to their natural position within private law, while at the same time preserving their functions in dejudicialization and restorative justice.