HOW HAS ODR BEEN AFFECTED BY COVID-19

Ashmin Goel*

*Ashmin Goel is a student of Law at The University Institute of Legal Studies, Panjab University. This Blog Post won the third place in the Blog Writing Competition which was co-organised by Ex Curia International and ODR Latin America.

HOW HAS ODR BEEN AFFECTED BY COVID-19

Ashmin Goel*

 

I.     INTRODUCTION

In 2020, the onset of covid-19 created a severe disruption in almost all the countries of the world at an unprecedented level. The countries had to respond to this pandemic by taking stringent safety measures that included imposing overall lockdowns and curfews, leading to deleterious effects on the economies and a plummet in the GDP growth of the countries in the year 2020. As of now, we still do not know when the pandemic will be over; it has posed enormous health and socio-economic challenges for the world. The precarity posed by the threat of the rise of the coronavirus has stymied the growth of both private and public institutions for quite a long time. A need has arisen where the whole world will have to accustom themselves to the new digital life of social distancing as the virus has curbed the possibility to hold physical meetings and gatherings to run the economy. 

Accordingly, judicial, and arbitral institutions have been under tremendous pressure to keep functioning during the pandemic, notwithstanding the delay in delivering judgements due to lockdown restrictions and following social distancing and other measures to suppress the pandemic. The courts are frequently questioned about how they will continue providing justice, and thus there arises a need to assess their priorities while adapting to the pandemic. In such an aberrant situation where most of the workplaces and institutions have shut down, and arbitration hearings have been delayed or cancelled, it becomes pertinent to analyse the impact of the pandemic on dispute resolution. The corollary of the current crisis is the disruptions in the Alternative dispute resolution system, the ineffectiveness of which at a larger scale has led to seeking of solutions by a plethora of institutions and individuals which have hastily veered their minds and attention to the efficacy of the ODR mechanisms. The covid-19 outbreak has led to a rapid reshaping of how pending proceedings and future disputes will go forward. ODR is not an old phenomenon and has been in use since the 1990s and therefore, it will be easier to adapt to the online mode of solving disputes and given the flexibility and efficacy that ODR provides, we can expect a step forward towards the delivery of justice in this exigent situation with the support of technology.

II.    WHAT IS ODR MECHANISM?

Before we delve into the impact of the covid-19 outbreak on ODR, it is apposite to get an understanding of what is ODR. The United Nations Commission on International Trade Law ODR Working Group defines ODR as “a mechanism for resolving disputes facilitated through the use of electronic communications and other information and communication technology”.[i] In other words, Online Dispute Resolution (ODR) refers to the use of Alternative Dispute Resolution (ADR) mechanisms over the internet. ODR encompasses a series of online means of communication, including “e-mail, Internet Relay Chat (IRC), instant messaging, Web forum discussions, and similar text-based electronic communications”. [ii] ODR is aimed at resolving a claim or dispute arising out of issues ranging from an online e-commerce transaction to disputes arising from an issue not involving internet, called as an “offline” dispute. ODR being a modification cum addition to the traditional legal process of resolving claims and disputes, it has become one of the most widely used methods of alternative dispute resolution mechanisms. Online Dispute Resolution can be seen as an online equivalent of ADR as it primarily involves the use of negotiation, mediation or arbitration for dispute resolution.[iii]

Dispute resolution techniques range from methods where parties have complete control of the procedure, to methods where a third party is in control of both the process and the outcome.[iv]But with the introduction of the ODR mechanism, an additional two parties are found, which play a significant role in resolving disputes like the other three parties that are ubiquitous. The added parties are ‘technology’ being the fourth party and ‘the provider of the technology’ being the fifth party. The fourth party embodies a variety of capabilities in the same manner that the third party does, thus making an increase in technology advances, reducing the role of the third party. While the fourth party sometimes takes the place of the third party in the process of dealing with automated negotiations, it will frequently be used by the third-party as a tool for assisting the process.

As a result of this, ODR processes offers faster, transparent, low-cost, and accessible options for resolving disputes online. The attempt made by the judiciary and the legislature to achieve the goal of providing access to justice for all has been made attainable and smooth by the processes of ODR.

III.  CHANGES BROUGHT BY COVID-19

The virus has made the future uncertain, it has already affected the way business is done; most of the organisations are working on sub-optimal capacities, which had exacerbated the problems. Given the situation, the judiciary has readily incorporated technology as a means to deliver inclusive justice. Even during the nation-wide lockdown, the courts made an attempt to provide justice through the system of e-filings and virtual hearings. Still, given the excess delay in resolving disputes, arbitration through the way of technology came as the answer to increase the efficacy of resolving disputes, thereby becoming a turning point in finally bringing online dispute resolution (ODR) in the world of arbitration. The relevance of ODR in the covid era can be attributed to its cost-effective, flexibility and expedient nature. Even before the pandemic, ODR has been of much use in resolving e-commerce dispute at a significant level, but in the present time, it has been adopted to determine a wider variety of conflicts across the globe.

In light of the COVID-19 pandemic, even the current Chief Justice, Justice Bobde, has noted the need for steps to be taken to make courts virtual in order to prevent the shutdown of the top courts.[v]He has also emphasised the need to have international arbitration and artificial intelligence (“AI”) as a leading alternative to the current status quo.[vi]

Therefore, the arena seems set, driven by the pandemic induced urgency, for ODR to take-off as the primary mode of dispute resolution in India. ODR holds great potential in bringing efficient dispute resolution to revive the economy from the challenges posed by the pandemic.

IV.   CHALLENGES

In the Indian scenario, ODR is at a very nascent stage and given the exigency of the pandemic, ODR in India has been posed with severe challenges that need to be resolved by instantaneous actions. Despite the fact that the volume of online transactions in India has increased significantly over the last half-decade, there is no better role than accepting ODR as an efficient mechanism for resolving disputes and implementing a quick and equal dispute resolution system.[vii] Though the concept of “online dispute resolution” (ODR) has been batted around for years, it is ambiguous whether ODR is genuinely ready for prime time. Although there are many advantages of this process, but as a coin has two sides to it, ODR process like other process has its own shortcomings which need to be cured to adapt the process of ODR entirely in the times of pandemic. The main challenges posed are as follows:

    i. Building capacity and ensuring technological support-

One of the main pre-requisites of making ODR a reality in the covid-19 era is the technological capacity and provision of the internet across the nation. Even though India might have a large absolute number of internet users, it still accounts for only 34.8% (2016) of its population.[viii] The lack of infrastructure and other technological barriers such as limited internet access will come out as a hindrance in the widespread adoption of ODR as a mechanism in India. To clear these obstacles, both government and private players will be required to contribute large-scale intensive resources to enable the adoption of ODR. Moreover, apart from technological shortcomings, ODR in India faces the challenge of mental barriers as people are not comfortable with solving disputes through internet-driven communications compared to face-to-face interaction to solve disputes. However, due to the enormous success of ODR in resolving e-commerce disputes, people will start building credence with the mechanisms of ODR gradually.

    ii. Data protection and privacy

Another shortcoming of using online platform and digitization is the growing frequency and sophistication of cyber-attacks. Although arbitral institutions have veered towards digitization as per the rising demand in resolving cases, essential security measures needed for virtual hearings have still not been appropriately addressed by the institutions. When dispute resolutions are made online, there is always a concern about the confidentiality of the proceedings and privacy of data of the parties both before and after proceedings. One way to protect the rights of the parties is to ensure that there are protocols and requirements in place that require document encryption as well as a strict privacy policy, the specifications of which must be communicated to the parties.

V.    DELIVERY OF JUSTICE IN POST-PANDEMIC ERA

When the possible threats posed by the covid-19 outbreak subsides, arbitral institutions have expected a surge in the cases for dispute resolution. Particularly, it is envisaged an increase in the number of new cases as a ramification of the impact on projects that were either postponed or cancelled due to the economic impact of the pandemic on the country or by governmental actions. Further, several analysts have anticipated that a tsunami of disputes is likely to dawn on in the post-pandemic period, closely following the ‘waves’ of infection, and there is some evidence that this is already happening. With this, we can expect a rise in the cases related to health care disputes or health insurance disputes. Moreover, due to the historic unemployment caused by the pandemic, effects of which are loss of insurances of employees given by their employers, there is an increased risk that they may suffer economic hardships or health issues and thus might be forced to file for disputes and seek for alternative courses of action for their resolutions. Likewise, the precarity of the virus now makes it somewhat a dystopic task to anticipate what measures will be needed to keep providing ‘access to justice’ to the people without any unreasonable delay. Susskind has previously observed that we must decide if a court is a place, or a service and this question proves more relevant now than ever. To respond to the possible ‘case surge’, there is an urgent need for judicial & arbitral institutions to develop corresponding strategies. Given the increasing relevance of the ODR mechanism in the covid era, people will get accustomed to opting for the arbitration method rather than going for the traditional court hearings so that they can get less time consuming and efficient resolutions to resolve their disputes. Thus, it can be seen that ODR as a mechanism has a significant role to play in the impending time, where technological progression will be the new norm.

VI.   CONCLUSION

The large-scale pervasion of the virus worldwide has caused the countries to adopt innovative methods by shifting towards technological advantages to conduct businesses or govern people. After analysing a plethora of facts leading to increase in relevance of ODR mechanism in the upcoming time, one thing is clear that ODR has a growing role to play in the future, arbitral institutions will have to build appropriate strategies and take stringent measures to fight back the considerable backlog of cases caused by the pandemic and also fight the boom in cases in the upcoming time. ODR undoubtedly offers various advantages over the traditional legal system, but it is pertinent for institutions to be aware of the challenges posed to the ODR mechanism. There are issues like ensuring technological support to all, privacy and confidentiality concerns that need to be taken care of. Moreover, the scope of ODR in handling disputes is still limited to small and medium-sized disputes, which include businesses-to-businesses disputes, disputes arising out of large international commercial transactions is still not under its purview. As ODR grows, it will need to be carefully designed in terms of governance and regulation. It is imperative to strike a balance between protecting users’ rights and interests while also avoiding over-regulation that stifles innovation. The present is a new era of justice delivery, one that can fulfil the constitutional goal of providing equal ‘access to justice for all by using the best that technology has to offer to question and improve upon traditional processes.


[i] United Nations Commission on International Trade Law, ‘UNCITRAL Technical Notes on Online Dispute Resolution’ (2017) vii (25 march, 2020, 8:36pm)

<unicitral.org/pdf/English/texts/odr/V1700382_English_Technical_Notes_on_ODR.pdf>

[ii] A History of Alternative Dispute Resolution: The Story of a Political, Cultural, and Social Movement p.261 ,(San Francisco:Jossey-Bass, 2004)

[iii] Karan Singh, Online Dispute Resolution (ODR): A Positive Contrivance To Justice Post Covid- 19, [mondaq], [march,25, 2021,8:40pm] https://www.mondaq.com/india/arbitration-dispute-resolution/935022/online-dispute-resolution-odr-a-positivecontrivance-to-justice-post-covid-19

[iv] C. Rule, Online Dispute Resolution for Businesses. B2B, E-Commerce, Consumer, Employment, Insurance, and Other Commercial Conflicts (p. 37) (San Francisco, Jossey Bass, 2002) 

[v] PTI, ‘CJI rules out total shutdown of Supreme Court amid coronavirus threat’,(Livemint), (25 march, 2021, 8:50 pm) https://www.livemint.com/news/india/cji-rules-out-total-shutdown-of-supreme-court-amidcoronavirus-threat-11584300621602.html 

[vi] PTI, ‘CJI Bobde bats for law containing compulsory ‘pre-litigation mediation’, (The week)(25 march. 2021, 9:00 m) https://www.theweek.in/news/india/2020/02/08/cji-bobde-bats-for-law-containing-compulsory-prelitigation-mediation.html 

[vii] Karan Singh, Online Dispute Resolution (ODR): A Positive Contrivance To Justice Post Covid- 19, [mondaq], [march,25, 2021,8:40pm] https://www.mondaq.com/india/arbitration-dispute-resolution/935022/online-dispute-resolution-odr-a-positivecontrivance-to-justice-post-covid-19

[viii] Internet Live Stats, ‘Internet Users by Country (2016)’ (25 march, 2021, 9:01 pm) https://www.internetlivestats.com/internet-users-by-country/ 

*Ashmin Goel is a student of Law at The University Institute of Legal Studies, Panjab University. This Blog Post won the third place in the Blog Writing Competition which was co-organised by Ex Curia International and ODR Latin America.

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