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Broadly speaking: The Mechanism of ODR from India's Persepective

Aug. 09, 2020   •   Snehal Asthana

INTRODUCTION.

Disputes are a clash of interest that is wrapped up within the surrounding of legal rights and duties. People many a time tend the need for enforcing their legal rights precluding the protection of their interests. This has lately converted to disputes between people which increased the awareness for the protection of their interest rather than emphasizing on enforcement of their rights and duties. With the increase in the interconnected business trade, there has been an increase in the disputes between the parties which ends up with the end of the smooth flow of work or trade between them. To bring an end to this problem and show that a singular dispute cannot terminate the commercial relationship of the parties anymore the concept of Alternate Dispute Resolution (ADR) was brought up to fulfil the requirement for the need for ironing the differences. And with the massive growth in the sector of e-commerce worldwide, the market shifted from offline medium to online medium. This brought a significant change in the mechanism of ‘dispute resolution system’ as well, bringing about a new kind of mechanism with some unique features with it which were later on called the Online Dispute Resolution (ODR).

After the enactment of the Information Technology Act, 2000 in India, the e-governance and e-commerce were given legal and conventional recognition in India. Then after the Online Dispute Resolution mechanism was brought in India which acted as an important part of the Legal Enablement of the ICT system in India.

ALTERNATIVE DISPUTE RESOLUTION (ADR).

As the court of justice everywhere in the world is facing problems when trying to meet the need of the market the concept of ADR is the best solution to it. It is a conceptual change in the dispute resolution mechanism and shows the movement from the jurisdictional theory to the parties’ autonomy concept. Through this system, matters were solved, whether they were initiated privately or publicly, without going to the court of justice. It was quick, simple, and at a cost proportional to the stakes. And as it provided a greater guarantee of confidentiality, people started referring to the ADR system.

Soon after this concept was pushed forward making it a more positive and realistic approach for dispute settlement by the people.

Types of ADR:

  • NEGOTIATION- It is in its simplest form, the exchange of proposal between the parties when the parties wish to settle the dispute out of the court. Unlike, the other forms of ADR, negotiation doesn’t involve any intervention of the third party. Here, the parties are mutually meant to discuss upon the dispute and come up with a solution and it entirely lies in the hands of the parties. These discussions are kept confidential and the parties can withdraw at any point they wish to.
  • MEDIATION- It is the facilitation of the negotiated agreement by a neutral third party called as the mediator for the resolution of conflict. They don’t have any decision making power so their decisions are non- binding in nature.
  • ARBITRATION- This dispute resolution process is quite analogous or similar to that of litigation as it is adjudicatory in nature. The decision is given by the impartial third party i.e. the arbitrator is binding in nature. The only difference is it more flexible and less formal as compared to that of the court of justice but the end judgment is bound to be accepted by the parties. This is the best dispute resolution process and has reduced the 57

ONLINE DISPUTE RESOLUTION (ODR).

It is a branch of dispute resolution which uses technology as its medium to resolve the disputes between the parties. It uses the digital technology and techniques of the ADR system such as negotiation, mediation, and arbitration for the resolution of the disputes. The ODR is conceived as a means to achieve access to justice at a reasonable cost i.e. everyone involved in the dispute shall be entitled to access the mechanism easily and the mechanism would provide timely resolution at a reasonable cost. It makes the resolution of the disputes feasible and convenient for the parties as through the help of internet the parties located at distant places no longer need to travel across the globe to resolve the dispute and all sort of online as well as offline disputes arising from transactions between the parties can be resolved through ODR. In the recent COVID- 19 pandemic situation, the main focus is to look after the disputed through ODR, which is an important part of economic revival.

ONLINE DISPUTE RESOLUTION IN INDIA.

The United Nations Commission on International Trade Law (UNCITRAL) had adopted the concept of UNCITRAL conciliation rules, 1980 and UNCITRAL model law on International Commercial Arbitration, 1985 and the United Nations General Assembly (UNGA) had recommended using these rules and law whenever any sort of disputes arises.

India incorporated these uniform principles and enforced its new act called as Arbitration and Conciliation Act, 1996 which was amended several times and is accepted by the UNCITRAL. The ADR system works according to the act prescribed by the law making body of India. With the growth of the e-commerce sector in India at a fast speed, the online dispute resolution was established in India. It basically utilizes the Information technology Act, 2000 to carry out the ADR. The ODR system in India is still at its infancy stage and is gaining its importance day by day. Recently, NITI Aayog, in association with the Agami and Omidyar Network India and many senior judges of the Supreme Court[1] brought together a multi- stakeholder agreement to work collaboratively to ensure efforts are taken for advancing the ODR system in India.

There is a great development in the ODR system in India after the pandemic and the mechanism which was once at the infancy stage has now acquired greater importance in the society. India has opted for the hybrid of both opt-in model and opt-out model[2] for the betterment of the parties. [3]

India has a robust ecosystem of the leading startups in the space and these startups can provide access to justice and ease the management of business if provided with proper clarity and encouragement.[4]

SUGGESTIONS ON REGARD OF ODR MECHANISM AS AN EFFECTIVE TOOL FOR INDIA:

  1. There should be a need to change the mindset of the people in respect to the idea of justice i.e. the court.
  2. ODR should be made mandatory and the hybrid model should opt.
  3. Private ODR providers should be added in the mechanism so that the online resolution can reach different industries, part of the country.
  4. More priority and recognition should be given to the ODR mechanism so that the concept reaches every people down there in the society.
  5. Need for the specialized institutions that can provide training, education, research for the success of ODR in India.
  6. India has a large scope to have ODR as an effective tool by developing the infrastructure.

The author is Abhijit Mohanty, a fourth-year law student from Amity University Rajasthan pursuing BBA LLB(Hons.) integrated course with a specialization in International Trade Law.

Disclaimer: The article is an original submission of the Author. Niti Manthan does not hold any liability arising out of this article. Kindly refer to our terms of use or write to us in case of any concerns.


[1] https://niti.gov.in/catalyzing-online-dispute-resolution-india

[2] Under Opt-in model mediation is voluntary and in opt-out model the parties are mandatory to go through the mediation process at least once.

[3] Unlocking opportunist for ODR, Justice Indu Malhotra, Supreme Court of India.

[4] ODR startup Ecosystem in India, Sachin Malhan, Co- founder Agami.


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