The Emergence of Online Dispute Resolution

Author:Anthony Connerty
Profession:Barrister and member of WIPO arbitration panel

1) Electronic Commerce. -2) Online Dispute Resolution: i) Commercial Developments: eBay and Square Trade. ii) International Developments: the United Nations.


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1) Electronic Commerce

In the introduction to the 1999 article on electronic commerce referred to in the last Chapter, this writer stated that:

"For the past few years the emergence and development of the Internet has made changes to the life of millions of people worldwide. The rate of development is extraordinary. Even today, no one can predict with certainty where the Internet will take us. One of the areas where the Internet has had a particular impact is commerce. Cross-border trading can take place on the Internet virtually without regard to national boundaries. The problems which this raises for politicians, lawyers and legislators are immense....

"Broadly speaking, there are two types of business being transacted on the Internet: that between business and consumer and that between business and business.... Many consumers in the United Kingdom are now becoming used to shopping on the Internet: not just supermarket shopping, but shopping in increasingly sophisticated areas.... If the increasing consumer business on the Internet in Britain follows the trend in America, the rate of growth will be staggering. The estimated business-to-consumer trading in America, presently put at $8 billion, is reckoned to increase to $108 billion over the next five years. But this is small beer compared with business-to-business trading. The American forecasts for inter-company trading put the present figure at $43 billion, increasing to $1.3 trillion in 2003....

"Business on the Internet - electronic commerce - will not simply present opportunities and challenges to businessmen: cybertrade presents challenges and opportunities to lawyers, legislators, governments and international bodies concerned with international trade." 110

The article then went on to consider problems likely to be created in relation to trading on the Internet:

* formation of a contract;

* digital signatures, encryption and authentication;

* electronic payment;

* intellectual property rights;

* governing law and jurisdiction;

* dispute resolution.

It is the last of these topics - dispute resolution - that will now be considered: specifically, online dispute resolution (ODR).

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2) Online Dispute Resolution

ODR may be defined as a dispute resolution process that operates entirely by electronic means, without the need for the parties in dispute to meet physically. The actual dispute resolution procedures used may include some of the types of alternative dispute resolution (ADR) systems considered in Part IV of the Manual.111

ODR has been developing not only in the commercial field, but also internationally through organisations such as the United Nations.

i) Commercial Developments: eBay and Square Trade

The Internet auction organisation, eBay, has instituted a system for resolving disputes...

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