Tuesday, November 2, 2010

Building a Practical Legal Framework for eCommerce Dispute Resolution

Michael Dennis, Attorney Advisor, Private International Law, Office of Legal Advisor, US Department of State
  • e-Commerce sales estimated to be 8 trillion in 2008 and will rise to 16 trillion soon.
  • Existing legal framework for cross-border disputes has been comparable with Wild Wild West to date
  • Studies show consumers gain benefits through cross-border commerce. Benefits usually mean cost savings!
  • But many traders unwilling to trade across borders, even within EU.
  • 51% of EU retailers sell via Internet, but only 21% conduct corss-border transactions.
  • Could the system be free to consumers with a small charge to participating businesses?
  • OAS proposal: Select and approve ODR providers - and get sellers to participate.
  • OAS Process: Consumer initiates -> diagnosis -> negotiation -> facilitated settlement -> arbitration -> enforcement
  • Anticipated that most disputes will be resolved in early phases.
  • Challenge: build system to handle high volume, low value disputes at a reasonable cost.
  • OAS procedural rules attempt to minimize cost by providing procedural rules to create multi-phase process.
  • First phase(s) totally automated - lowest cost
  • OAS: provide standards for certifying ODR providers
  • Significant challenges remain - but the need for solutions is even greater. The time is now to build a global ODR system to provide much needed justice solutions.
  • Enforcement could be one of the most difficult issues we face in international ODR context.
Prof. Lou Del Duca - Dickinson School of Law, Penn State, UCC Law Journal

Prof. Del Duca's talking points:
  • Ongoing blurring of distinction between B2B and B2C: the smaller claims need immediate, efficient, transparent solutions.
  • Must distinguish between high volume / low cost and high cost/low volume disputes
  • Optional instrument: set up a new system of law for ODR; let contracting parties opt into it
  • How do individual governments develop their legal framework in the context of setting up a body of law that's optional for contracting parties to opt into?

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