ONLINE DISPUTE RESOLUTION: INTERNATIONAL APPLICATION AND LESSONS FOR VIETNAM

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MINISTRY OF EDUCATION AND TRAINING
FOREIGN TRADE UNIVERSITY
MASTER THESIS
ONLINE DISPUTE RESOLUTION:
INTERNATIONAL APPLICATION AND LESSONS
FOR VIETNAM
Specialization: International Trade Policy and Law
FULL NAME: NGHIEM LY TIN
HANOI - 2020

MINISTRY OF EDUCATION AND TRAINING
FOREIGN TRADE UNIVERSITY
MASTER THESIS
ONLINE DISPUTE RESOLUTION:
INTERNATIONAL APPLICATION AND LESSONS
FOR VIETNAM
Specialization: International Trade Policy and Law
Code: 8310106
FULL NAME: NGHIEM LY TIN
SUPERVISOR: DR. HA CONG ANH BAO
HANOI - 2020

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TABLE OF CONTENT
REASSURANCE.......................................................................................................1
ACKNOWLEDGEMENT........................................................................................2
LIST OF ABBREVIATIONS...................................................................................3
LIST OF FIGURES ..................................................................................................5
SUMMARY OF THESIS RESEARCH RESULT .................................................6
INTRODUCTION.....................................................................................................7
1. Research rationale.............................................................................................. 7
2. Literature review................................................................................................ 9
3. Research objectives ..........................................................................................12
4. Research questions ...........................................................................................13
5. Scope of research..............................................................................................13
6. Methodology.....................................................................................................14
7. Research disposition.........................................................................................14
CHAPTER 1: FUNDAMENTAL FRAMEWORK .............................................15
1.1. History of Online Dispute Resolution ...........................................................15
1.2. Online Dispute Resolution and characteristics..............................................18
1.2.1. Definitions ..............................................................................................18
1.2.2. Characteristics ........................................................................................21
1.3. Methods of Online Dispute Resolution .........................................................22
1.3.1. Group of fundamental methods..............................................................22
1.3.2. Group of compound methods .................................................................28
1.3.2.1. E-Mediation-Arbitration (E Med-Arb) ..............................................28
1.3.2.2. Ombudsman .......................................................................................28
1.3.2.3. Online juries/mock trials ...................................................................29
1.4. Advantages and Disadvantages of ODR application.....................................30
1.4.1. Advantages of ODR................................................................................30
1.4.2. Disadvantages of ODR ...........................................................................35
1.5. Basic conditions for ODR implementation ...................................................39
1.5.1. Awareness and trust to ODR ..................................................................39

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1.5.2. Legal regulations ....................................................................................40
1.5.3. ICT platform...........................................................................................40
CHAPTER 2: INTERNATIONAL APPLICATION ON ONLINE DISPUTE
RESOLUTION ........................................................................................................41
2.1. Application on ODR in European Union ......................................................41
2.1.1. Legal framework of ODR in EU ............................................................41
2.1.2. Practical application in European Union................................................45
2.2. Application on ODR in North America.........................................................48
2.2.1. Legal framework of ODR in North America .........................................48
2.2.2. Practical application in North America ..................................................49
2.2.2.1. Government Initiatives in ODR .........................................................50
2.2.2.2. ODR Professional Organizations......................................................53
2.3. Application on ODR in China .......................................................................58
2.3.1. Legal framework of ODR in China........................................................58
2.3.2. Practical application in China.................................................................59
2.3.2.1. ODR and Domain Names Disputes: The ADNDRC..........................61
2.3.2.2. ODR and the CIETAC Online Dispute Resolution Center................61
2.3.2.3. The HKIACODR Initiative.................................................................63
2.3.2.4. Other Initiatives.................................................................................64
2.4. Evaluations and future of ODR .....................................................................65
CHAPTER 3: APPLICABILITY AND PERSPECTIVE OF ONLINE
DISPUTE RESOLUTION IN VIETNAM............................................................67
3.1. Statement of Online Dispute Resolution in Vietnam ....................................67
3.1.1. Factors for ensuring ODR application in Vietnam.................................67
3.1.2. The necessary of application ODR in Vietnam......................................69
3.1.3. Current situation of conditions to apply ODR in Vietnam.....................72
3.1.2.1. Current situation of ODR in Vietnam................................................72
3.1.2.2. Advantages and opportunities ...........................................................74
3.1.2.3. Disadvantages and reasons ...............................................................77
3.2. Suggestions and solutions..............................................................................78
CONCLUSION........................................................................................................82
LIST OF REFERENCES .......................................................................................83

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REASSURANCE
I hereby assure that this master thesis is exclusively made by myself and that
all data and results stated in this master thesis are honest.
In addition, I hereby assure that all of the supports in the process of
implementation cited in the master thesis have been specified its sources.
Author
Nghiem Ly Tin

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ACKNOWLEDGEMENT
First and foremost, I would like to express my sincere gratitude to my
supervisor, Dr. Ha Cong Anh Bao for his enthusiastic support of my graduation
master thesis, with patience and knowledge. Hardly could I complete my work
without his fascinating guidance and suggestions throughout the past five months.
Beside my advisor, I would like to thank all professors and lecturers in Foreign
Trade University, especially lecturers in Master Program of International Trade
Policy and Law (MITPL), who spent all their enthusiasm and dedication to bring
knowledge to us. The result acquired in the learning process is not only necessary
for me to complete my thesis, but also help me be more confident to improve my
career in the outside world.
My special thanks also is for my family, friends and my classmates for their
encouragement and spiritual supports they gave me in the whole time of composing
one of the most important and meaningful work in my life.
Hanoi, 09 July 2020
Nghiem Ly Tin

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LIST OF ABBREVIATIONS
ADNDRC The Asian Domain Name Dispute Resolution Center
ADR Alternative Dispute Resolution
B2B Business to Business
B2C Business to Consumer
C2C Consumer to consumer
CAGR Compound Annual Growth Rate
CIETAC Economic and Trade Arbitration Commission
CNDRP CNNIC Domain Name Dispute Resolution Policy
CNNIC China Internet Network Information Center
CPTPP
Comprehensive and Progressive Agreement for Trans-
Pacific Partnership
CRDP The Center for Research in Public Law
DNDRC Domain Name Dispute Resolution Center
ECC-NET European Consumer Centers Network
E-commerce Electronic commerce
EEA European Economic Area
EU European Union
EVFTA Vietnam Free Trade Agreement
FTA Free Trade Agreements
GDP Gross Domestic Product
HKDNR
The Hong Kong Domain Name Registration Company
Limited
HKIAC The Hong Kong International Arbitration Centre
ICANN The Internet Corporation for Assigned Names and Numbers
ICT Information & Communication Technology

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IT Information technology
KIDRC Korean Internet Address Dispute Resolution Committee
KLRCA
The Kuala Lumpur Office operated by the Kuala Lumpur
Regional Center for Arbitration
NADRAC
The Australia National Alternative Dispute Resolution
Advisory Council
NCAIR The National Center for Automated Information Research
NCTDR The National Center for Technology and Dispute Resolution
OAS Organization of American States
ODR Online Dispute Resolution
PPP Purchasing Power Parity
RCEP Regional Comprehensive Economic Partnership
SDRCC The Sports Dispute Resolution Center of Canada
SMEs Small and medium-sized enterprises
TDRP Transfer Dispute Resolution Providers
TLD Top level domain names
UDRP Uniform Domain-Name Dispute-Resolution Policy
UNCITRAL United Nations Commission on International Trade Law
USA United States of America
USD United States Dollar
WTO World Trade Organization

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LIST OF FIGURES
Figure 01: The process on the ODR platform .................................................... 42
Figure 02: Complaints summited per month in two years of ODR platform
implementation ................................................................................. 46
Figure 03: Structure of complaints under regional levels and product ranges ..... 47
Figure 04: Vietnamese Internet users ................................................................. 67
Figure 05: Smartphone penetration rates in Vietnam ......................................... 68
Figure 06: Structure of retail market in Vietnam................................................ 69

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SUMMARY OF THESIS RESEARCH RESULT
In the circumstance of global and regional integration, E-commerce is
expanding in Vietnamese society as the major mode of purchasing. Online dispute
resolution (ODR) seems to be the most suitable method to solve conflict arise from
E-commercial activities and other businesses in the digital era. However, currently
the full awareness of ODR and related issues still are strange with most of parties
who join ODR implementation including government, enterprises and consumers.
The Master thesis with topic of “Online dispute resolution: International
application and lessons for Vietnam” concentrates on analyzing and consolidating
ODR definition and characteristics with practical lessons from some foreign
countries with legal challenges, along with supplying recommendation on applying
ODR in Vietnam situation to bring a vision and opinion of the author based on
academic aspect. The recommendations and solutions found in the thesis hopefully
are going to contributes a little to ODR development and growth in Vietnam.

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INTRODUCTION
1. Research rationale
Conflict is a growth industry (Fisher 1991, pg. 18).
The invention of E-commerce transactions changes the essence of the social
habits of business entities and individuals. E-commerce moves the traditional
commercial social environment from and industrial economy where machines
dominated productivity, to an information-based economy where intellectual
content is the dominant source of value added and there are no geographic
boundaries. In particular, it provides small and medium-sized enterprises (SMEs)
with lower market entry cost and the ability or possibility to extend geographic
reach to a much large market. It will undoubtedly improve economic efficiency,
competitiveness and profitability (Faye. Wang 2010, pg. 6).
New opportunities are always paralleled by new challenges in any form of
technology, economy and society. IT brings the benefits of efficient cross-border
commercial transactions but challenges the essence of the traditional laws and the
knowledge and technique of traditional law makers and practitioners. Legislators,
judges, lawyers and practitioners need insight into the operation of this new and rapidly
expanding industry with sufficient cross-disciplinary knowledge, experience and skills.
In the paper-based world, connecting factors, such as the place of domicile, the place of
business and the place of performance, are used to determine jurisdiction and choice of
law. When contracts are concluded and performed by electronic means, those factors
become blurred. The determination of private international law in cyberspace requires
legal experts to have special knowledge about IT systems and to interpret new and
existing legal concepts for the online environment.
Every year, thousands of multinational companies are emerging in the world,
constantly expanding sales and production internationally through the Internet. This
is largely seen as the key to growing the economy and stimulating globalization.
Transactions in a global market increase the probability of trans-national disputes.
Moreover, parties situated sometimes in different continents are often opposed over

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small claims. However, when disputes arise, traditional dispute resolutions become
problematic because different countries have different rules for trade and various
prohibitive costs of legal action across jurisdictional boundaries. Moreover, for
traditional dispute resolutions, the appropriate forum is determined by the place of
business or the place of performance. In cyberspace, the localization factor can be
much less obvious as the boundless internet may be accessed from anywhere in the
world.
E-commerce, a new determinant of commercial transaction via cyberspace,
commenced since 1980s under the simplest form as credit card, ATMs of banks, or
initial electronic contracts. Nevertheless, E-commerce only developed disruptively
and popularized since 1990s when the Internet was invented. As the result, the
conflicts arose from E-commercial activities have increased, pressured to the
national legal system and related authorities. Courts and ADR, such as negotiation,
arbitration and other combined resolutions under common procedure have not been
suitable to apply for the special kind of dispute resolution. ODR was born to fulfill
all the gaps mentioned.
Vietnam is a land of opportunity for foreign E-commerce companies because
of its young population. Under EU-VN Business Network, high Internet penetration
rate (ranked 17th
in the world) and climbing smartphone penetration rates.
Millennials, considers the target population of E-commerce firms, account for 30%
of Vietnam’s population (approximately 30 million people). The penetration of
Internet is projected to increase steadily, with the percentage of Internet users set to
reach 65% in 2022 (EU-VN Business Network 2018, pg. 6).
Following its accession to the WTO in 2007, Vietnam has allowed foreign
investors to establish 100% foreign-owned companies. This has attracted many
foreign investors, including E-commerce retailers. As E-commerce is expected to
soon become an important part of Vietnam’s trade sector, currently, big names such
as Lazada, Shopee, Adayroi, Tiki and more recently, Amazon, market have seized
the opportunity and entered Vietnam. In 2017, the Southeast Asian E-commerce
market was growing at 35% per year, 2.5 times faster than in Japan. Vietnam ranks

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4th
for online shopping in the Asia Pacific region and is expected to continue
booming in the coming years, with sales estimated to reach EUR 8.1 billion
(approx. USD 9 billion) in 2020.
Being not beyond the global rule of development, to match the the trend of
international integration, Vietnam issued Law on E-transaction in 2005 and
Information Technology in 2006, with by-law documents to govern E-commerce.
However, until now, ODR as one of the most important to motivate E-commerce is
not governed by law in clearly and specifically to settle disputes with E-commerce
origin and affect to the online transaction efficiency.
By the reason, the topic of “Online dispute resolution: International
application and lessons for Vietnam” is selected. The thesis is will be necessary for
all of policy makers, modern enterprises and online consumer to pave the way,
actualize and develop ODR in Vietnam.
2. Literature review
Although Online Dispute Resolution has about 30 years-developing journey
with the growth of Internet, ODR in Vietnam is still inexperienced and the term is
new with most of people in both of academia and business, although there are quite
many science reports republished in Vietnam mentioned this topic in recent years.
The author would like to review some typical researches from both Vietnamese and
foreign sources as following:
- E.Katsh (2001) – “Online dispute resolution as a solution to cross-
border E-Disputes” – the author starts with describing ADR in general
and the major of ADR, then expressing the forms of ODR statement in
US and Canada, especially mediation. Finally, he tries to answer under
what conditions online mediation can provide a solution for cross-border
e-disputes in the EU and make recommendation for making online
mediation possible in the European context;
- American Bar Association (2002) – “Addressing disputes in Electronic
commerce: Final Report and Recommendations” – the Task Force of this

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association defines clearly the definition of ODR as well as detailed scope
of its application in current statement as the fundamental understanding
of lawyers and law students in USA, with important recommendations set
the protocol of ODR development;
- Colin Rule (2002) – “Online Dispute Resolution for Business: B2B, E-
commerce, Consumer, Employment, Insurance, and other commercial
conflicts” – the author supply essential information to senior
management, general counsels, and risk managers of large companies and
start-ups alike about the benefits of using Internet-based dispute
resolution to resolve disputes before they escalate, as well as
businesspeople think how about ODR can benefit their organizations, to
give a snapshot of the current global environment for ODR, and to
provide some pointers and suggestions to help get the process started;
- Faye F. Wang (2009) – “Online Dispute Resolution: Technology,
management and legal practice from an international perspective” – the
author proposes the opinion that international and national legislative
organizations should amend or update the offline ADR rules by
recognizing electronic means of communication in resolving disputes and
incorporating concepts of ODR. From many international cases, it is
necessary to establish a uniform Code of Conduct at international level;
- F. Petrauskas et al (2011) – “Online Dispute Resolution in consumer
disputes” – this article sets out general views on online transactions and
consumer protection in the context of E-commerce and possible online
dispute resolution means. The authors are chiefly concerned about legal
uncertainty and the jurisdiction as well as applicable law in business-to-
consumer (B2C) E-commerce;
- Pablo Cortés (2011) – “Online Dispute Resolution for Consumers in
European Union” – The author examines the consumer protection law in
the EU, how national judicial authorities are incorporating ICT into their
processes and online mediation for e-consumers; discusses the current

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development of ODR and evaluates the challenges posed by ODR and
evaluates the critical question of whether a legal framework is needed in
the EU to develop consumer ODR, the author explores the efficiency and
sufficiency of the existing regulatory mechanisms and the need for
designing a European legal framework in the field of ODR.
- Phan Thi Thanh Thuy (2016) – “Resolving E-commerce Disputes:
Challenging Legal Issues for Vietnam” and “Resolving Trade Disputes
through Reconciliation in Vietnam: Some Legal Issues needs being
paid attention” – the researches focus on the analyzing of the concept
and characteristics of ODR, the challenging legal issues Vietnam has to
resolve in order to develop. Besides, they also point out and analyze the
legal hurdles that should be paid attention to make reconciliation be
practical and effective in the context of global and regional economic
integration, E-commerce has widely spread in Vietnam;
- Ha Cong Anh Bao and Le Hang My Hanh (2017) – Online Dispute
Resolution – Ability of applying in Vietnam – the article mentioned
ODR as a suitable solution for Vietnam when its dispute settlement
system is facing some difficulties. In the articles, the authors analyzed the
content and characteristics of ODR, review and assess the advantages and
disadvantages if applied ODR in Vietnam, from which, the authors stated
that Vietnam can apply if there is consensus and unity of actors involved
in E-commerce transactions, as well as supporting from government
agencies;
- Nguyen Xuan Dung (2018) – “Trade dispute settlement by negotiation
and conciliation in Vietnam” – in the master dissertation, the author
researches, analyzes, and evaluates the statement of current legal system
and trade dispute resolutions, especially negotiation and conciliation. By
the way, he clarifies advantages and disadvantages, unsuitable aspects in
the legal system and practical activities to propose visions and solution to
improve legal framework for negotiation and conciliation in Vietnam;

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Due to the fact that ODR is a controversial topic, there are numerous authors
and scholars are interested in, and a large number of relating books and articles
were published in the world. However, ODR is a new issue in Vietnam, it has just
been proposed to match with high level development of E-commerce in Vietnam in
recent years. So, there are a little number researches for this field with the content
has not been backward when compare with the day by day changes of E-commerce
in our country.
By the thesis, besides theoretical issues will be updated and cited
comprehensively from both Vietnamese and foreign science reports, the author
would like to combine and analyze empirical cases in over the world to clarify
relating problems, and by the way, to propose ideas, as well as possible methods
and vision, to apply ODR implementation and interoperability in Vietnam context.
3. Research objectives
It is quite cleared that Vietnam should act soon for the unexpected dispute in
business and to defend Vietnamese enterprises against risks raised in the international
trade. Meantime, Vietnamese legal frameworks and regulations for ODR and other
forms of international dispute settlement are not strong and comprehensive enough to
be willing to integrate the international environment of business. Therefore, the content
of this thesis will highlight the objectives as following:
- Systematizing and analyzing the basic definitions, opinions and principles
of ODR as well as its mechanism;
- Getting deeper awareness of ODR statement in the world:
+ Study situation of implementing ODR in some choosen countries to
resolve conflicts appear;
+ Understanding the way ODR organized in the mentioned countries;
+ Mentioning advantages and disadvantages in practical ODR apllication.
- Recommendation for the development of ODR in Vietnam:
+ Finding out factors motivate ODR in Vietnam and challenges need to
be solved;

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+ Proposing and consulting recommendations and suggestions for
government, enterprises and consumers to improve and facilitate
effectively the development of ODR in Vietnam.
4. Research questions
The key questions of this thesis include:
1/ What are definitions and relating theoretical issues of ODR?
2/ How do developed countries apply ODR and its efficiency?
3/ What are the lessons for Vietnam, and is ODR suitable to be applied in
Vietnam in the present and future?
In order to find out the answers for the key questions above, these sub-
questions are focused as below:
- What are the fundamental definitions and principles of ODR and ADR?
- What are theoretical characteristics, advantages and disadvantages,
benefits ODR?
- How is statement of legal framework, E-commerce and general
environment for implementing online dispute settlement in Vietnam?
- What are lessons and how is ODR suitable with Vietnam context?
- To perform ODR effectively in Vietnam, what are legal resolutions and
recommendations to improve and complete?
5. Scope of research
In terms of the content of the thesis, it concentrates on the ODR and its
application in both of theoretical and practical aspect in the world and Vietnam.
Thus, the scope of the study is shown as below:
As for the geographical scope, the research is aimed to make a deep view
concerning about ODR implementation and application in European Union, North
America including USA and Canada, also China. Then, the thesis focuses on the
case of Vietnam.

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As for time scope, the thesis focuses on the duration of 2016-2019 mainly for
analyzing and synthesizing information and database. This period remarked the
appearance and spread of ODR and E-commerce in the world.
6. Methodology
To carry out the study, the author combines the methods of synthesizing
information and using the statistics to compare, analyze and clarify the mentioned
issues. Moreover, the author also incorporates ODR cases to visualize theoretical
aspects.
To be more specific, the thesis is also completed based on the application of
theoretical and practical research methods. The data is collected, quoted from
reports, researches of experiential and trusted researchers and organizations in the
field of ODR. Primary data for such study is hard to conduct since ODR is quite
new in Vietnam going along with the limitation of resource of the author.
7. Research disposition
With the table, charts, references and appendixes, the thesis includes the main
content as follows:
Introduction
Chapter 1: Fundamental Framework
Chapter 2: International Application on Online Dispute Resolution
Chapter 3: Applicability and Perspective of Online Dispute Resolution in
Vietnam
Conclusion

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CHAPTER 1: FUNDAMENTAL FRAMEWORK
1.1. History of Online Dispute Resolution
The first half of the 1990s was a period of significant change in the online
environment. The World Wide Web was invented in 1989 and the first browsers
appeared a few years later (E.Katsh 2009, pg. 23). Netscape, the most popular
browser at the time, was quite user-friendly and the online population began to grow
as it became easier to acquire Internet access and it was discovered that it was
relatively easy to communicate and to obtain large quantities of information online.
It was at this time, around 1994, that it began to be clear that cyberspace, in the
future, would not be a harmonious place and that there would be a need for tools,
resources and expertise in responding to the disputes that would occur. In 1996, the
first articles about ODR appeared in a law review, the National Center for Automated
Information Research (NCAIR) sponsored the first conference devoted to ODR
(E.Katsh 1996, pg. 193), and funding from NCAIR launch the first significant ODR
projects, the Virtual Magistrate, the Online Ombuds Office at the University of
Massachusetts and a family dispute ODR project at the University of Maryland. At that
point, the Internet was twenty-seven years old. The domain name system had come into
being in 1985 but in 1990 there were only 7,800 domain names and a single person
managed the system. Formal dispute resolution systems did not exist and apparently
were not needed. This changed, however, as the Internet grew in a variety of new
directions. Disputes are a byproduct or side-effect of transactions and relationships
since, inevitably, a percentage of interactions in any environment can be expected to
face problems. With the growth of E-commerce, more transactions were encouraged
online and, as a result, more reports of disputes were occurring.
A year after the NCAIR conference, the Hewlett Foundation provided a grant to
the University of Massachusetts to establish the Center for Information Technology and
Dispute Resolution (later the National Center for Technology and Dispute Resolution).
The goal of the Center was to support the development of the field of ODR. One of the
Center’s first activities was to organize Cyberweek, an all-online

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conference that enable over four hundred persons from many different countries
demonstrations of software. Cyberweek has been an ongoing event of the Center
and in 2010, it was co-sponsored with the ADR Hub of Creighton University
(E.Katsh 2009, pg. 23).
There were several physical conferences about ODR held in the late 1990 and
the early years of the twenty-first century but the one that has continued to be
central to the field is the International ODR Forum. The original idea for the Forum
came from Daewon Choi, an official of the United Nations Economic Commission
for Europe. The first two of which were held in Geneva in 2002 and 2003. Since
then the Forum has been held in Melbourne (Australia) (2004), Cairo (Egypt)
(2006), Hong Kong (2007), Liverpool and Victoria (Canada) (2008), Haifa (Israel)
(2009), Buenos Aires (Argentina) (2010), Chennai (India) (2011), Prague (Czech)
(2012), Montreal (Canada) (2013), Silicon Valley (USA) (2014), New York (USA)
(2015), The Hague (Netherlands) (2016), Paris (France) (2017), Auckland (New
Zealand) (2018) and Virginia (USA) (2019).
Court, in the mid-1990s, were beginning to struggle with jurisdictional
questions such as where an event occurred if parties were in different places and
were interacting online. Many of legal questions surfacing at the time, however,
while interesting, were largely irrelevant to persons who found themselves involved
in a dispute arising online. In the vast majority of situation, where parties were in
different places, land based courts and systems were not really useful options for
persons who felt aggrieved.
During the Internet “bubble” of 1999-2000, many ODR start-ups appeared and
then disappeared. A few, such as Smartsettle, Cybersettle and the Mediation Room,
remain. Ebay’s original ODR provider, SquareTrade, shifted its attention from ODR
to consumer warranties in 2006.
ICANN, a nonprofit organization responsible for coordinating the maintenance
and procedures of several databases related to the namespaces and numerical spaces of
the Internet, established the process of Uniform Domain-Name Dispute-Resolution

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Policy (UDRP) for the resolution of dispute regarding the registration of Internet
domain names. Besides, ICANN and the Uniform Dispute Resolution Policy for
resolving domain name disputes were instituted in 1999.
Interest in ODR has broadened geographically. The annual International
Forum on ODR mentioned earlier has been hosted at least once on every continent.
UNCITRAL, the United Nation body focused on international trade law, is working
on rules and policies for ODR in cross-border disputes. In Israel, Benoam is an
online arbitration system established in 2002 to resolve subrogation claims between
insurance companies over property damages incurred in “fender-bender” car
accident.
Software appropriate for ODR is more available today. More software choices
exist, some in general use and some, such as the Community Court of Modria and the
Web-based applications of Juripax and Fair-Out Comes that was specially developed.
The last ten years have also seen more interest in ODR on the part of computer
scientists and more collaboration between ODR and computer science fields.
The network’s rapid communication and information processing capabilities,
however, did open up opportunities for creative approaches and responses to problem
solving for cases that did not go to court. In other words, many of the same forces that
contributed to disputes could also be employed to resolve disputes. Today, there is little
doubt that there is an ongoing and growing need for ODR. There are indeed large
number of disputes rise from online activities; in fact, there are a greater numbers of
disputes than anyone predicted. For example, the eBay Resolution Center revolves an
incredible amount of over 60 million disputes per year, making it one of the biggest
ODR systems in the world. In addition, over this period of time, how and when ODR is
being used has also expanded. Without neglecting the need to respond to disputes
occurring offline. More to the point, the boundary line between the online and offline
worlds is, as “the digital world merges with the physical world” (Gershenfeld 1999, pg.
10), much less clear than it used to be. As a result, the challenges of ODR currently is
less focused on where the disputes originated than it

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is in finding tools and resources that can be as effective in any dispute regardless of
where it originated.
1.2. Online Dispute Resolution and characteristics
1.2.1. Definitions
Conflict is present in all environments, it is fact. On the Internet, there are many
new and interesting environments. In these virtual places, where transactions,
interactions and relationship can be begun and end quickly, where barriers of time and
space are not constraints on communication, where identities can be transformed on the
screen, and where potentially valuable new forms of intellectual property can be
created at the keyboard, it is not surprising that disputes are occurring.
Online dispute resolution was born to adapt and resolve these kinds of conflict
above, growing with the development of Internet, nowadays, ODR is still a new
field in the most countries in over the world. So, it is not difficult to understand,
until now, there are many arguments about its definition among researchers with
different concepts.
- According to Colin Rule, Online Dispute Resolution (ODR) is the use of
information and communication technology to help disputants find
resolution to their disputes;
- Julia Hörnle, from University of London, in her paper, ODR is stated as a
kind of information technology and telecommunication via the Internet –
(together referred to as “online technology”) applied to alternative dispute
resolution;
- Hon. Arthur defined ODR under its function, in which ODR provides the
ability for two (or more) disparate parties to settle their dispute using
Internet. Sometime this involves lawyers and mediators and sometimes it
does not. It depends on the vehicle/provider that the parties agree to use
to resolve their claim;

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- Susan Nauss, in her article, defined the ODR as “any method by which
parties attempt to resolve dispute online”, means of communication
include email, chat rooms, bulletin board, and virtual communications;
- Orna Rabinovich summarized ODR includes “forms of dispute resolution,
such as negotiation, mediation, and arbitration, which are conducted
through written digital communications”;
- Edwards and Wilson divide ODR into “hard” ODR, referring to
“procedures intending directly to resolve conflicts” such as traditional
ADR, and “soft” ODR, relating to “procedures seeking to prevent
disputes” such as e-Bay’s feedback system for reputation ranking. In the
author’s opinion, ODR should be defined as online procedures to resolve
disputes or conflicts covering e-ADR and cybercourts;
- Being mentioned by Feye.Wang, with the development of technology,
ODR designated cyberspace as a location for dispute resolution, moving
ADR from a physical to a virtual place. That is, ODR services are the
online transporation of the method developed in the ADR movement.
However, ODR not only employs the ADR processes in the online
environment but also enhances these processes in offline environments;
- Dr. Mohamed Wahab mentioned to the ODR as a branch of dispute
resolution that utilizes technology and artificial intelligence to settle
disputes. Traditionally, ODR targeted online disputes of diverse forms
and origin. Nevertheless, ODR seems to have outgrown its initially
predestined online milieu and is now capable of fulfilling its potential by
targeting offline diputes;
- The Australia National Alternative Dispute Resolution Advisory Council
(NADRAC) defines ODR as “process where a substantial part, or all, of
the communication in the dispute resolution process takes place
electronically, especially via email;
- The Department of Justice, Canada considers ODR as “refers to a wide
class of alternate dispute resolution processes that take advantage of the

20
availability and increasing development of internet technology”. It is a set
of DR processes that allow for the resolution of disputes via online
mechanisms such as the Internet or some forms of technology that allows
for virtual communication without requiring the parties to be in a room
together;
- According to ABA, ODR is a broad term that encompasses many forms
of alternative dispute resolution (“ADR”) that incorporate the use of the
Internet, websites, email communications, streaming media and other
information technology as part of the dispute resolution process. Parties
may never meet face to face when participating in ODR. Rather, they
might communicate solely online.
From the definitions as mentioned, we can summarize that Online dispute
resolution (ODR) is a wide field and branch of dispute resolution which uses
technology to facilitate the resolution of disputes between parties. It primarily involves
negotiation, mediation or arbitration, or a combination of all three. In this aspect, it is
often seen as being the online equivalent of alternative dispute resolution (ADR).
Therefore, ODR can also improve these traditional means of resolving disputes by
applying innovative techniques and online technologies to the process.
However, ODR does not only transfer the real ADR into cyberspace, or online
ADR, but also expand to litigation in the online environment. And it should be
noted that, ODR does not mean removing all the mechanism of processing
information traditionally and face to face among parties. ODR may be used in a
substantial part, or all, of the dispute resolution process, as confirmed in ODR
definition of NADRAC above.
Under the Department of Justice (Canada), there are three main types of
dispute classifications within the ODR framework:
i. Business to Business (B2B)
Business to Business (B2B) disputes revolve around two commercial parties
that are seeking to resolve a dispute over a specific transaction. The parties in B2B

21
tend to be sophisticated users, and there is generally less concern over party
vulnerability, and a greater emphasis placed on the convenience and expertise of the
process. With many B2B disputes resolved with some form of ODR, the use of
arbitration is prevalent.
ii. Business to Consumer (B2C)
Business to Consumer (B2C) disputes are becoming more common, particular
with the expansion of E-commerce. B2C disputes tend to be low-cost, but high-
volume, and may involve unequal bargaining power between the consumer and the
business. An ODR process may meet consumers’ need for amending businesses and
to provide the necessary support for due process rights.
iii. Consumer to Consumer (C2C)
Consumer to consumer (C2C) disputes involve transactions between two
consumers (i.e. the sale of a used item). These types of E-commerce transactions are
also becoming more common with websites such as eBay or Craigslist acting as
facilitators between two parties, although the website is not an actual party to the
dispute.
1.2.2. Characteristics
ODR was born from the synergy between ADR and ICT, so it has full of the
same characteristics as ADR and the advantages of ICT. Under The Department of
Justice, Canada, main and remarkable characteristics can be listed as below:
Voluntary: Most ODR processes allow the parties to elect to participate in
them, or pursue their claim in another forum. Most also allow the parties to
withdraw from the process at any given time.
Informal: The proceedings are generally more relaxed and informal than in-
person proceedings such as mediation, litigation or arbitration. Depending on the
ODR Provider and the rules in place, the process may be conducted in an
asynchronous manner and allow the parties time to reflect on their positions before
coming to any agreement.

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Confidential: ODR is generally a confidential process, unless the parties
agree otherwise. Notwithstanding a confidentiality clause or agreement, when the
federal government is a party, the Access to Information Act and Privacy Act must
be examined to determine the extent to which they restrict disclosure and
withholding of information. For further information about the application of these
Acts, please refer to the document entitled "Confidentiality: Access to Information
Act and Privacy Act" contained in this Reference Guide.
Assisted: The ODR Neutral’s role is that of an impartial third party who helps
the parties come to a mutually acceptable settlement. (Note that an ODR Neutral is
generally only used if the ODR process contains a mediation or arbitration
component.)
1.3. Methods of Online Dispute Resolution
Basically, ODR has been developed on ADR background, so most of methods
applied are the same. The distinguished point is, whereas ADR moves dispute
resolution “out of court”, ODR moves it even further away from court - to
cyberspace (Faye. Wang 2009, pg. 28).
There are numerous methods in practical implement of ODR, they may be
divided into 02 categories, including Fundamental and Combining methods.
1.3.1. Group of fundamental methods
a. E-negotiation
In its simplest form, negotiation involves an exchange of views and proposals
when a dispute opposes parties who wish to settle out of court. Unlike mediation or
arbitration, negotiation does not involve the intervention of a third party. Finding a
mutually acceptable solution to the dispute lies entirely in the hands of the parties,
the negotiation process is confidential and completely voluntary; generally, the
parties can withdraw at any point.
There are a number of reasons why negotiation is becoming more important in
the age of electronic commerce. Firstly, negotiation among parties is facilitated by

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the rapid means of communication that are now available. If the parties do not have
to travel to hold a “last chance meeting” to try to come to an agreement, it is much
more likely that the meeting will take place. Secondly, the phenomenon that is
generally known as the “trust deficit” with respect to legal problems in trans-border
trade increases the parties’ interest in finding solutions that avoid recourse to law
and legal processes. Thirdly, the technological tools now available to the parties to a
dispute open the way to a new range of “assisted” negotiation tools without having
to seek the intervention of a third party. Finally, integrated ODR programs now
make it possible to add a negotiation stage, which used to be completely informal,
before the mediation or arbitration process begins.
Formerly confined to an exchange of correspondence or one or more meetings
between the parties, it is now easier for direct negotiation to include tools that
facilitate the identification of basis for agreement. The most common example is
that of blind bidding tools, which are numerous in the United States. They enable to
parties to engage in a series of simultaneous “blind” bids after first agreeing on a
zone of agreement that both find satisfactory.
The software tool in question records the parameters of the settlement desired
by the parties (if the difference between the two simultaneous bids is USD 1,000 or
less, for example, the settlement is the median of the two bids), and then records the
successive bids until the preset parameters are reached. Finally, it generates the text
of an agreement to which the parties agreed ahead of time. Obviously, the tool is
useful only for resolving disputes over an amount where the claim is not contested
in any other way, for example, it is used widely in insurance disputes. Blind bidding
is a good illustration of the potential that technological tools have to add a “third
party” aspect to negotiation to facilitate the meeting of minds. Clearly, the software
environment plays a structuring role to promote the meeting of minds. There is the
reason to believe that these applications will only keep getting better, thereby
increasing the prominence of assisted negotiation as a key means of resolving
disputes.

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One of the typical applications of E-negotiation is SquareTrade. The
SquareTrade Web-based negotiation tool is automated, parties get to communicate
on neutral ground, it states that problems are usually solved in ten to fourteen days
and 85 percent of all cases are resolved without going to mediation (M.Collier 2007,
pg.105).
b. E-mediation
Mediation is a form of alternative dispute resolution, in which parties resolve
the dispute themselves, with the help of a neutral mediator. The mediator does not
make a decision, but helps the disputing parties to find the solution that is
acceptable to all parties involved (E.Katsh 2009, pg. 7).
It is important to note that the mediator does not have the power to impose or
propose a decision. After comparing the parties’ points of view, identifying with
them their points of agreement and disagreement, and taking into account the
interests of each side, the mediator orients and structures the discussions and tries to
optimize communication so as to enable the parties to come to a satisfactory
solution on their own. In most cases, the mediator is free to hear the parties together
or separately. Separate, i.e., caucus, meetings usually increase the chances that
mediation will be successful because the parties then convey information that they
would not dare to reveal to the other party, thereby enabling the mediator to find
possible middle ground that the parties might not have suspected was there if left to
their own devices. Caucus meeting are very sensitive undertakings and require some
reserve on the part of the mediator because the basis for agreement has to be woven
out of confidential information.
Once the process is completed, the mediator generally has to write a report on the
success or failure of the mediation. In case of failure, the parties are basically back
where they started, though they are better informed about each other’s positions. In
case of success, the transactional agreement is universally acknowledged, at least as a
contract binding the parties and opening the way to ordinary recourse in case of
violation. However, the contract has a special status in some civil law countries,

25
where it is considered a transaction, i.e., a special contract the purpose of which is
to resolve a dispute. The special status is translated by a virtually automatic
recognition that transforms the transaction into a judgment for all intents and
purpose. As yet, transactional agreements are far from having this status
everywhere, and despite recent efforts by the United Nations Commission on
International Trade Law (UNCITRAL), there is still no universal regime for
compulsory execution of international transactional agreements.
One of the reasons the researchers chose online mediation over online
arbitration was the fact that online arbitration projects have had great difficulty in
obtaining cases, because potential respondents do not wish to consent to the
decision making authority of an arbitrator. This probably also explains the fairly
successful launching of several online mediation initiatives and the lack of online
arbitration initiatives.
The Centre for Information Technology and Dispute Resolution at the
University of Massachusetts has conducted a study project in 1999 to ascertain how
effective an online mediator could be to solve e-dispute arising out of online auction
transactions on eBay website, the largest online auction site on the web (E.Katsh
2009, pg.11).
Internet Neutral website are examples of cyber mediation. It allows parties to
choose from several online mediation alternatives, including e-mail, instant
messaging, chat conference rooms and video conferencing. Internet Neutral uses
conferencing software that enables the mediator to communicate with the parties in
designated channels or ‘rooms’ accessed securely with passwords. During the
mediation, the software enables the parties to communicate through two channels:
one for a private dialogue between one party and the mediator, the other for open
dialogue with all participants, including the mediator (Faye. Wang 2009, pg. 49).
c. E-arbitration
Arbitration is a process in which a dispute is submitted to an independent,
private tribunal that renders a decision after having allowed the parties to make the

26
necessary representations and present relevant pieces of evidence to support their
points of view. As in the case of mediation, arbitration is sometimes very
advantageous for parties that are in conflict but nonetheless wish to pursue their
contractual relationship and maintain the confidentiality of the proceedings. It
should be noted that arbitration is generally more flexible and much less formal than
court proceedings, but results in a decision that is as binding as a judgment and for
which enforcement is greatly facilitated internationally.
Parties can provide for recourse to arbitration right when they sign the contract
that unites them. This is done through an arbitration clause such that all disputes
arising out of their contractual relationship are subject to arbitration in accordance
with the conditions set out in the clause or in legislation. Of course, it is also
possible to provide for recourse to arbitration after the contract is signed using an
adjunct, in other word, an additional legal instrument modifying the initial contract.
Finally, the parties can also initiate the arbitration process after a dispute has arisen
by signing an arbitral compromise, but this rarely occurs because it is generally
difficult to come to an agreement after a dispute has occurred. In each of these
cases, it will no longer be possible to bring the dispute before the courts, except if
there is a criminal offence involved, for example. An arbitration agreement involves
renouncing the right to regular recourse before the courts.
The renunciation is binding if the arbitration in question is ad hoc or institutional.
In ad hoc arbitration, the procedure is in principle expedited directly by the arbitrator or
arbitrators outside of any institutional framework. The primary disadvantage of ad hoc
arbitration is that if a disagreement or obstacle arises with respect to the establishment
of the arbitral tribunal, the parties have no recourse aside from the courts of the country
where the tribunal is located (if the country can be clearly identified). In such cases, the
national court acts as a judge supporting the arbitral procedure and intervenes upon
request in accordance with the modalities and time frames set out in the rules regulating
that procedure. In the case of an international transaction, recourse to a court most often
contradicts the parties’ desire

27
to avoid “national” procedures and actors in order to maintain neutrality,
confidentiality and efficiency.
The best way to avoid intervention by the courts as much as possible is to
employ institutional arbitration, which provides a framework that can establish an
arbitral tribunal and activate the process despite any disagreement or problems that
arise. Thus, the institution can appoint arbitrators, make decisions on
disqualification, see to the smooth operation of the procedure and the meeting of
deadlines, set arbitrator compensation and set parameters for the award, as required
and in accordance with pre-established conditions. Online arbitration is most often
institutional, but could also take ad hoc forms in cases where the arbitral tribunal
uses an Application Service Provider (ASP) document management system but
controls the procedure itself.
The arbitrator, who is invested with authority through the parties’ consent,
hears the parties’ claims in compliance with established rules of procedure and,
after deliberation, renders a decision, known as an arbitration award, that is binding
on the parties and can be enforced in all countries that have signed the Convention
on the Recognition and Enforcement of Foreign Arbitral Awards (New York, 1958).
The Convention provides the backdrop for all normative initiatives in arbitration,
and requires the courts of some 125 signatory states to acknowledge written
arbitration agreements, declare themselves incompetent to hear disputes that are
subject to arbitration clauses, and enforce awards in accordance with criteria set out
in its provisions. The advantages of arbitration for international transactions are
largely due to this multilateral treaty, which has no equal with respect to ensuring
the exclusive jurisdiction of national tribunals and obtaining enforcement abroad of
resulting judicial decisions. As the primary means of managing international trade
disputes and as a model for private justice, international commercial arbitration also
owes its success to accelerated modernization and harmonization of national
legislation on arbitration, which are fruit of the success of the UNCITRAL Model
Law on International Commercial Arbitration (1985).

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The New York Convention commits the states in question to recognizing and
enforcing foreign arbitral awards in accordance with a regime that essentially
restricts their legal authority to the protection of public order, in other words,
protection of the core values that would justify state intervention in the most
liberalized system. This is precisely the model that we believe could be established
for trans-border administration of justice in areas that cannot be classified as purely
commercial. It is a model of justice that takes into account the need for countries to
withdraw in order to achieve greater efficiency and tailor the process more to the
circumstances and needs of trade while providing some control over collective
principles and values that, initially, do not seem to lend themselves to regulation by
private initiative and market forces alone.
1.3.2. Group of compound methods
1.3.2.1. E-Mediation-Arbitration (E Med-Arb)
E-Mediation and E-arbitration (Med-Arb) is a mechanism of a hybrid process,
in which disputed parties agree to use a blend of mediation and arbitration to handle
their conflict. First, a mediator is in charge of the dispute mediating any
disagreement between the parties. If the disputants refuse to accept the solutions,
then the mediator acts as an arbitrator and decides the results of the remaining issues
(Faye. Wang 2009, pg. 36).
The final results, therefore, combines both mediation settlement and
adjudicatory processes. This two-step approach helps avoid throwing the conflict
into the more cumbersome and time-consuming litigation process. A successful
example can be given by NovaForum, which provide med-arb services through its
Electronic Courthouse. Another successful example can be also provided by AAA
and Cybersettle, which combines online negotiation with the other online dispute
resolution.
1.3.2.2. Ombudsman
Ombudsman is a kind of procedure for complaint from ordinary consumers
about companies, the government or public authorities. The procedure is a two-step

29
one, consisting of online mediation and an online recommendation. At the first
stage, the Ombudsman mediates between the parties. If this does not lead to a
settlement, and if both parties agree to a second stage, the Ombudsman makes a
recommendation. The process uses an online platform and electronic database
(Ha.C.A.Bao 2017, pg.5).
An interesting project in the ODR context is the Austrian Internet Ombudsman,
founded in 1999. Consumers can bring disputes against business, arising from E-
commerce, before this ombudsman service. Only consumers can make a complaint and
initiate the procedure, not businesses. The Austrian ombudsman service is not
mandatory. Consumers can choose it by initiating a claim. The company against whom
a claim is made is asked whether or not it wishes to participate in the procedure. Some
companies may have agreed to take part before the dispute, by signing up to the Euro-
label Code of Conduct and Trustmark scheme. This does not make online arbitration
generally obligatory, but, for a business which has opted to become a member of Euro
label before the dispute arose and who has been certified in Austria, it does require
participation in the Internet Ombudsman procedure. Such a business would have to
accept a recommendation made by the Internet Ombudsman service at the second stage
of the procedure (J. Hörnle 2009, pg.76).
1.3.2.3. Online juries/mock trials
Online summary jury trials or mock trials are an ODR mechanism whereby a
jury of peers makes a non-binding determination of the issues via a website. The
parties upload their respective pleadings and evidence onto the site, and the ‘jurors’
can ask questions and render an online verdict, recommending how the dispute
should be solved. The neutral third party is replaced by a number of volunteering
Internet users acting as if they were the jury in a truncated civil court trial by
posting their questions and verdicts onto the website. This ODR mechanism assists
the parties in their negotiations for a settlement by reality-testing their positions
against the supposed common sense of the volunteers forming ‘the jury’. The mock
jury is claimed to reflect the likely behavior of a real jury, and takes into account the
US constitutional preference for jury trials in civil cases (J. Hörnle 2009, pg.77).

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1.4. Advantages and Disadvantages of ODR application
1.4.1. Advantages of ODR
Obviously, ODR offers many advantages of traditional face-to-face dispute
resolution. Resolutions can be reached more quickly, and at less cost. Matters can
be kept confidential. Costs are much lower. Future complaints are avoided because
relationships are maintained and strengthened. Disputants are more satisfied with
both the process the outcome. Resolutions are more creative. Enforcement is less of
a challenge, because the disputants have ownership over the resolution.
In addition to those benefits of dispute resolution generally, ODR offers
important new benefits to everyone involved in a dispute, including:
a. Speed
The main advantage of online dispute resolution, and the one that brings the
majority of parties to it, is speed. On the internet, people have come to expect that
everything they need should be available to them twenty-four hours a day, seven
days a week. When someone wants information or services or support they often
expect that on the internet they should be able to get it whenever they want.
Traditional judicial systems are built with the exact opposite intention. Delay is
used intentionally to encourage people to reflect, or to ensure that people are serious
and determined to reach a solution. Even face-to-face dispute resolution systems
have begun to take longer and longer, particularly formal procedures like arbitration
(C. Rule 2002, pg. 63).
Online dispute resolution, on the other hand, can move very quickly because
scheduling meetings and planning for travel and finding space are not necessary to
convening and beginning an online process. A virtual meeting room can be opened
instantaneously and a neutral can be engaged from anywhere around the world. This
means that in online dispute resolution the parties’ expectation of instant availability
and fast, efficient service can be met. For most disputants, this is the most
compelling reason to utilize online dispute resolution, because their overriding
desire is to resolve the matter quickly.

31
b. Asynchronous interaction
Face-to-face dispute resolution must happen in “real time” as each side reacts
immediately to new developments. A mediator can call a “time out” or use a caucus
to break up this flow, but in most joint meetings and discussions disputants must
engage in a give-and-take where their responses are expected right away. In the
terminology of computer-mediated communication, this is synchronous interaction
(C. Rule 2002, pg.63).
Online parties, however, have the possibility of asynchronous interaction, where
their response is not expected immediately. Disputants can connect to the ongoing
discussion at different times, and even defer their response until after they’ve had time
to consult with others, do some research, or just contemplate the situation.
c. Power differences
One of the most interesting advantages online dispute resolution can offer
disputants is the way it changes the nature of their communication. When a dispute
arises between two people who have a relationship from a prior context the
disputants can get into certain communication patterns that reinforce the
disagreement they find themselves involved in. Usually relationships reflect some
sort of power equation between the participants, such as between a supervisor and
supervisee, between husband and wife, or between a professor and student. This
power dynamic affects the communication between the two parties. It may be that
the more powerful party is accustomed to speaking uninterrupted, or is accustomed
to not having her points aggressively questioned. The party that perceives himself as
less powerful may unconsciously participate in this communication dynamic. Or,
alternatively, the party that feels less powerful may feel the need to be more
aggressive or very defensive to counteract what he perceives as the advantages of
the more powerful opponent (C. Rule 2002, pg. 64).
Online communication often changes this dynamic. Research into the use of
email in organizations has found that lower-level employees are willing to send

32
emails to upper management with comments and observations that they would be
uncomfortable saying in person.
Neutrals can learn to use the newness of online communication patterns to the
process’s advantage by helping people reevaluate unproductive modes of
communication and build new communication channels in conjunction with their
exploration of online communication options. Skilled facilitators can exploit ODR
tools to combat calcified relationships and repair broken lines of communication.
People in relationships based on past power differentials can communicate on more
of a level playing field when online communication options are brought into the
picture.
d. Research
In face-to-face dispute resolution process, the two parties are often sitting at a
table looking at each other over little more than a pad, a pencil, and a few
documents. Sometimes it is very difficult for one side or the other to confirm or
deny the veracity of the facts provided by the other side. For example, in a dispute
between a computer supplier and a business owner, the computer supplier could say
in a face-to-face dispute resolution process that the cost of the raw motherboard in
each of the machines provided to the business was $500 apiece. The business owner
who purchased these machines may not have any idea if that number is wildly high
or wildly low. In a face-to-face dispute resolution process, that business owner
would probably have to respond to that estimate with a guess about its veracity. If
that valuation is crucial to crafting a resolution to the dispute, it may be that later
when the business owner finds out that price was inaccurate, he or she will feel that
they agreed to an unfair resolution.
In an online dispute resolution process, however, it’s a simple matter for participants to
conduct research in the middle of the process. If a representation is made by one side
about the cost of a component or the value of an item, the other side can easily verify
the cost over the Internet. Once that research is conducted, she can even share that
research with the other participants by providing a Web address. This ability to

33
conduct research as the dispute resolution process is occurring provides an
important reality check to any resolutions that are being considered by the
disputants. It also guarantees that any agreements that are reached will stand up to
later scrutiny because the parties were fully informed at the time the agreement was
being crafted (C. Rule 2002, pg. 65-66).
e. More reflective communication
One of the goals of the dispute resolution profession is to help disputants
reflect on why they feel the way they do in a particular dispute situation, why they
want what they’re asking for, and what they really need to be satisfied with the
resolution to the matter. Sometimes it’s very difficult to get the parties to
communicate why they are frustrated in a particular situation. Often the disputant
walks in with a particular demand and refuses to rethink that demand. The only
thing that will satisfy him, he says, is getting that one thing. Much of the work a
mediator does may be asking the party to step back and think more broadly about
other ways the matter can be resolved.
Online communication, by its very nature, encourages this kind of reflection.
As people draft their written comments they are naturally forced to answer the
question “why?”
In writing, people have more of the tendency to explain why they are saying what
they’re saying, whereas in face-to-face communications people often just state their
position and cross their arms, refusing to elaborate further. Because online
communication encourages reflection, mediators often find it easier to have parties
think about why the dispute came about and what they really need to resolve the
matter at hand (C. Rule 2002, pg. 67-68).
f. Self-disclosure - Race, Gender, and Age
One of the most difficult aspects of human nature to deal with is the problem of
bias. Different people are biased by different things. For example, some people may be
biased on the basis of race. For others, it may be sex, or sexual orientation, or age.
Sometimes one’s physical characteristics may lead to certain assumptions on the part

34
of others that are untrue. This is not only a challenge for disputants; neutrals need to
be cognizant of their own vulnerabilities to bias. Not all biases are negative. Some
people may find themselves favorably predisposed to others who share a common
physical or ethnic characteristic.
The problem of bias in human relations is well documented, but bias remains
very difficult to address. If a neutral is confronted with a party who is biased against
the other party, it can often be difficult or impossible to address that bias within the
limited time frame of the dispute resolution process. Many dispute resolution
professionals would argue that even attempting to address such bias within a dispute
resolution process would be difficult if not impossible.
Online dispute resolution is powerful because it enables parties to self-
represent. It is not immediately obvious in an online interaction if the other party or
neutral is male or female, black or white, gay or straight, or old or young. In many
circumstances, the parties can choose what they want to share about themselves or
what they want to hide. It is even possible for the parties to misrepresent
themselves, or to leave certain characteristics unaddressed. The challenge of bias is
a very difficult one to address in mediation practice. But online dispute resolution
creates an environment where bias can be removed as a factor in building an
agreement between two disputants. This is impossible in face-to-face interactions.
g. Convenience
The most obvious advantage of an online dispute resolution process is its
convenience. In a face-to-face process, the participants must dress up, take time off
of work, travel perhaps long distances to the meeting place, and spend hours
discussing the issues underlying the dispute. The time spent on all of these activities
has a clear cost, which is sometimes called the convening penalty. The convening
penalty is the time, money, and energy required to merely get the parties to sit down
at the table. In some circumstances, the convening penalty outweighs the desire of
the participants to resolve the dispute (C. Rule 2002, pg. 69).

35
In an online process the convening penalty is almost eliminated. Participants
can login whenever and wherever it is convenient for them to do so. The disputant
can login from his desk at work, or from home sitting in front of the computer in his
pajamas. There is no necessity to synchronize everyone’s schedules and to find
acceptable meeting times because the parties and the neutral can simply login
whenever they have time available. For many people with busy schedules this type
of flexibility is what makes their participation in a dispute resolution process
possible. For them, face-to-face dispute resolution may not even be an option.
h. Cost Effectiveness
Another major benefit of online dispute resolution from a business perspective
is the cost-effectiveness of the tools. Because there is no convening penalty, travel
and time expenses are significantly minimized.
Top-quality neutrals often charge less for online dispute resolution procedures
because they do not have to spend as much time traveling to meetings, scheduling
and synchronizing people’s calendars, and locating and reserving meeting rooms. In
addition, the significant negative exposure that can come from unresolved disputes
makes the financial calculus behind implementing online dispute resolution even
more obvious. Even if only one claim out of one thousand makes it all the way to a
courtroom hearing, the financial exposure on the part of the company may be
enormous.
Effective and efficient online dispute resolution services, provided early in the
development of the business-consumer relationship, can significantly decrease such
legal exposure, if not erase it completely (C. Rule 2002, pg. 77).
1.4.2. Disadvantages of ODR
Online dispute resolution can radically change the communication dynamics in a
dispute, which can lead to many of the advantages listed in the previous sections. It is
important to note, however, that these changed communication dynamics can also
result in disadvantages as well. Many of the characteristics of ODR processes are
double-edged, with both plusses and minuses. They can enable parties and neutrals

36
to make significant progress if used appropriately and correctly, but they can also
create new problems and challenges if mishandled.
a. Privacy and Confidentiality Concerns
Another shortcoming that grows out of archived communication is concerns
about privacy and confidentiality. They can be a major barrier in getting parties to
participate in an online process. If the parties are not 100 percent sure that
communications will remain confidential they will refuse to participate in a process
where they would be required to put sensitive information down in text form. Online
dispute resolution technology platforms usually rely on Web-based interactivity as
opposed to email because email is inherently insecure. It is easier to protect the
confidentiality of information that is maintained in a Web-based environment and
provided only to users who have logged on with the appropriate password and
username. However, there is no foolproof way to prevent parties from copying
information off of their screen for later use. Even if the parties are prevented from
cutting and pasting text, they can still take a screen capture of the text. In a face-to-face
dispute resolution process, it is much harder to surreptitiously capture communications
through the use of voice recording devices or similar techniques.
For this reason, it is of the utmost importance that online dispute resolution
service providers maintain the security of their platforms, and that they build
adequate protections to ensure that private information stays private. If a party
comes to a dispute resolution process because she is frustrated with what she
perceives to be a violation of her privacy, she will feel doubly wronged if the
dispute resolution platform cannot protect her privacy and ensure confidentiality as
well (C. Rule 2002, pg. 81).
b. Strategic communication
Research into online communication has also shown that people are more likely
to lie during online communication. It takes a special kind of person to be able to look
into his opponent’s eyes in a face-to-face interaction and to knowingly tell him
something that is untrue. Most people are confident that they can tell when another

37
person is lying if they can observe them face-to-face. The way that they make this
determination is to read the body language of the other side. In an online interaction,
there is no body language to give a cue to the intentions of the other side. If
someone looks you in the eye and says, “Yes, I sent the check,” most people believe
that they will be able to tell if that person is being truthful. In an online interaction,
that person could be laughing while he typed, “Yes, I sent the check,” and the other
side would never know.
Because it is so much easier to lie online, people are also less trusting of
information that they receive online. People are often much more skeptical of facts,
assertions, and apologies that they receive in online communication than they are when
the same information is presented face-to-face. Fortunately, the ability for parties to do
research online and to verify facts during the dispute resolution process can help to
build confidence in information exchange between the parties online. In some dispute
situations this skepticism can be a good thing, as it prevents one side from manipulating
or pulling the wool over the other side’s eyes. The ease with which people can
misrepresent or be strategic in what they say, and the resultant skepticism on the part of
the listener, can undermine communications and interfere with the development of
understanding between the parties (C. Rule 2002, pg. 82-83).
c. Lack of body language and nonverbal behaviors
Because online communication is primarily textual, most of the nonverbal
behaviors that people use to communicate are lost.
In a face-to-face dispute resolution process, skilled neutrals can almost learn
more about the true feelings of the disputants from watching the way they sit in
their chair, talk with the other party, or react to points made. If someone crosses
their arms or shakes their head no while listening to someone speak, or if they look
exasperated or sigh in frustration, important communication is taking place.
In an online interaction this communication is not possible. Every bit of
communication between the neutrals and the parties has to be typed in and sent
deliberately, which makes communication much more intentional but also filters out

38
many of these nonverbal cues. Many dispute resolution professionals rely so heavily
on these nonverbal cues that they are skeptical that any meaningful communication
can happen in a text-only environment. This is taking things a bit far, as it is
possible to have rich communication online, and there are ways to replicate
nonverbal communication. But the point is well taken that the lack of body language
is a disadvantage to online interaction (C. Rule 2002, pg. 83-84).
d. Establishing relationships
It is also much harder to build relationship between the parties in an online
environment than it is in a face-to-face interaction. Many of the things that people
talk about with each other when they first meet are not intended to communicate
meaningful or important information. They are intended only to establish a friendly
relationship. Often when strangers meet they have a discussion about the weather,
or the upcoming weekend, or the performance of local sports teams. This
communication can be very important in establishing a friendly environment for
future communications, even though no real information is being passed.
In online communications, this type of friendly banter is very rare. Such
communications come off very differently when typed in and posted in a discussion
environment.
People are usually much more businesslike in textual communications, which
means they don’t devote as much time as they would in a face-to-face
communication toward building that rapport and establishing a friendly
environment for the interaction. There are ways that technology designers can
combat this tendency to be overly businesslike, and neutrals can encourage parties
to begin their discussion with some rapport building, but it often does not come as
naturally online as it might face-to-face. Friendly, crowded participants oftentimes
will begin online interactions by jumping right into the issues, whereas in a face-to-
face interaction they would have taken the time to ask about the other side’s
interests, family, or make small talk (C. Rule 2002, pg. 84).

39
e. Power corrupts
Dispute resolution professionals often assume that they will not have as much
power in an online dispute resolution environment to control the agenda and keep
parties focused on the goals of the process. In reality, the opposite is usually the
case: online neutrals have much more power in their ability to direct parties to focus
on a particular issue, and often this power is unintentionally abused or misused.
Parties can feel bossed around by technology that forces them to go to a particular
place or answer a particular question. In a more prescriptive process, like blind
bidding or arbitration, parties may expect this type of treatment, but in a
negotiation-based process, like a mediation, parties can easily chafe under
technology or neutrals that are overly aggressive. I have seen online disputants rebel
against bossy neutrals and upend the process in frustration. Once an online process
devolves to this level it is nearly impossible to get the discussion back on track.
Like in any dispute resolution process, online or face-to-face, neutrals need to
be cognizant of both the positive powers of the tools available to them and the
negative potential of those same tools. Training neutrals about how not to use online
environments is as important as training them in best practices for ODR (C. Rule
2002, pg. 84-85).
1.5. Basic conditions for ODR implementation
1.5.1. Awareness and trust to ODR
The biggest barrier is the fact that ODR is a phenomenon that is not yet well
known to the legal profession. When ADR was concerned, most lawyers had
become aware of the existence of offline dispute resolution over the last ten years.
Hence, it might be take another decade for ODR to become accepted as fully
fledged forms of dispute resolution (E.Katsh 2011, pg. 19).
The first step towards the acceptance of ODR, is making the public awareness
for ODR as the part of modernization of the judicial system, and persuade customer
to believe in its confidentiality and fairness.

40
1.5.2. Legal regulations
ODR needs legislature to take steps toward encouraging parties to use the
dispute resolution on a widespread basis, in order to ensure fair and efficient, it will
first be necessary to create public legal standard. The unequal bargaining position of
disputants creates a requirement for legal provisions to uphold quality ODR
processes that prevent weaker parties from being abused. A legal framework will
boost the legitimacy of ODR by providing appropriate information, awareness and
trust (P.Cortés 2011, pg. 207).
1.5.3. ICT platform
Software platforms for administering dispute resolution cases were also being
sold in the late 1980s and early 1990s. Individual case administration entities, like
community mediation centers or arbitration offices, could use these pieces of
software on a single computer to coordinate case intake, the assignment of neutrals,
and follow up in particular matters. These programs were used only internally in a
single office, but they did provide a technologic infrastructure for the later
integration of collaborative technology (C.Rule 2002, pg. 24).
In this increasingly connected world, domestics and multi-jurisdiction
transactions conducted entirely over the Internet or facilitated by technology. This
has created a parallel need for innovative mechanism for resolving disputes arising
from E-commerce. The dynamic growth of the internet, absence of territorial
limitations, development of e-commerce and technological revolution has
demanded a re-think of the traditional methods of alternative dispute resolution
(ADR). This has led to a better integration of information communication
technology (ICT) tools into ODR processes in other to meet the expectations of this
technology age. Understanding artificial intelligence, big data, videoconferencing,
online repositories, block chain technology and Internet of Things (IoT) has become
paramount because this technological change has the ability to increase efficiency,
if properly harnessed.

41
CHAPTER 2: INTERNATIONAL APPLICATION ON
ONLINE DISPUTE RESOLUTION
2.1. Application on ODR in European Union
2.1.1. Legal framework of ODR in EU
The ODR platform was launched in January 2016 and opened to the public on
15 February 2016 (EC 2017, pg. 2). The platform's aim is to facilitate the online
resolution of disputes between consumers and traders over online transactions. The
platform has the following key characteristics:
 Consumers and traders can choose any of the EU official languages for
their interaction with the platform (e.g. submitting their complaints,
receiving notifications). An automatic translation tool is available for free
text communication.

 The platform identities which notified ADR bodies are competent to handle
the case and refers the dispute the ADR body on which the parties agree.

 ADR bodies can use the platform's case management system to conduct
the ADR procedure entirely online.

 The parties can request that the outcome of the ADR procedure is
translated by a professional translator.

 Clear deadlines are built into the platform to ensure a fast process.
The ODR platform is fully functional and has been developed as an interactive
web-interface offering a single point of entry to consumers and traders seeking to
resolve disputes arising from online transactions without going to court. More
specifically, under the Regulation (EU) No 524/2013 on online dispute resolution for
consumer disputes, amending Regulation (EC) No 2006/2004 and Directive
2009/22/EC (Regulation on consumer ODR), the platform's functions have been
designed and developed in compliance with Article 5 paragraph 4 of the ODR
Regulation, to allow the parties to conduct the dispute resolution procedure online
through electronic case management. The ODR platform allows consumers to initiate a
procedure by submitting a complaint electronically to a trader, allows the trader to

42
identify the competent ADR entity and, in case of agreement of both parties on the
ADR body, transmits the complaint to that body. In addition, it provides all relevant
actors with the free translation of information necessary for the resolution of the
dispute.
Consumer
Complaint goes to the trader
Trader proposes
Or
complains ODR Body
Proposal
goes to
consumer
No agreement is reached on
Or Trader proposes ODR Body
the choice of ODR Body
Proposal
goes to
consumer
Trader rejects
complaint or does not
respond via the
platform ODR Body
An ODR body is agreed
within 30 days or the
complaint is automatically
closed
ODR Body resolves dispute
From complaint to
ODR Process should take
resolution within 120 days
maximum 90 days
(Source: European Commission, Brussel, 2017)
Figure 01: The process on the ODR platform
In building the ODR platform, the Commission was supported by an expert group
composed of ODR experts designated by the Member States. Furthermore, the
Commission conducted three comprehensive testing exercises where 120 ODR experts
designated by the Member States, consumer organizations, trader associations and the
European Disability Forum tested the platform's various interfaces on the basis of real-
life scenarios. The feedback received from those exercises directly fed into the
platform's development and was important in ensuring its user-friendliness and
accessibility. The platform's workflow is prescribed in the ODR Regulation; the

43
Commission therefore designed the platform's various interfaces in full respect of
those legal requirements.
In accordance with the Report from the European Commission, the ODR
Regulation builds on the Directive on consumer ADR and thus the legal framework
for the operation of the platform includes both pieces of legislation. The ADR
Directive ensures that EU consumers can turn to certified ADR bodies when they
have a problem with a trader over the purchase of a product or a service in virtually
all retail sectors both domestically and across borders irrespective of whether the
purchase was made online or offline. The certified ADR bodies are required to
respect binding quality requirements such as impartiality, fairness, transparency and
effectiveness. Member States need to establish national lists of certified ADR
bodies and communicate those lists to the Commission. The details of the ADR
bodies (name, sectoral coverage and information on fees) are translated in all the
official languages of the Union and are subsequently electronically registered and
made publically available on the ODR platform (EC 2017, pg. 3).
The ADR/ODR legal framework applies to consumer disputes involving traders
established in the EU and in EEA countries. The ODR platform processes disputes that
stem from online sales or online service contracts between consumers and traders
resident/established in the Union and EEA countries. The platform does not address
disputes between consumers (C2C) or between traders (B2B), nor does it provide a
technical framework for direct negotiation between the parties, settlement attempts
made by a judge in the course of judicial proceedings, or disputes concerning health
services or public providers of further or higher education.
The ODR Regulation provides that Member States should designate ODR contact
points to provide one-to-one support to users of the ODR platform when necessary.
Online traders are required to provide a link to the ODR platform and state their e-mail
address, on which they can be reached via the platform, on their website.
In the context of ICT, there are two main Directives which aim to protect
consumers when buying online. These are the Distance Selling Directive (Directive

44
97/7EC) and the E-Commerce Directive (Directive 2000/3/EC), which aim not just
to grant minimum rights for consumers but also to harmonize the Member States’
legislation in order to facilitate and boot the internal market.
According to Pablo Cortés, the Electronic Commerce Directive, EU Member
States must ensure that their legal systems allow the formation, completion and
enforcement of electronic contracts. The requirements to create a valid electronic
contract are similar to those relating to traditional paper contracts.
On the one hand, common law legal systems require the concurrence of at
least three elements:
(i) An agreement ad idem (offer and acceptance);
(ii) Consideration (the acquisition of something of value in return for
what one gives or promises, usually an agreed sum of money); and
(iii) The intention to create legal relations.
On the other hand, civil law countries do not see consideration as a compulsory
element. In addition to the requisites to enter into traditional contracts, consumer
electronic contracts must fulfil extra legal requirements. First, consumers must be
informed about the technical steps required to conclude the e-contract. Secondly, the
terms and conditions must be available in a manner that allows their storage and
reproduction. Finally, the directive introduces a new element required for the formation
of an e-contract, namely the confirmation, which requires the service provider to
acknowledge the receipt of a consumer’s order (P.Cortés 2011, pg. 12).
One of the challenges of e-contracts is the difficulty in verifying the identity of
the parties. This obstacle is partly overcome through the use of electronic signatures. In
this regard, the European Commission has adopted a directive guaranteeing EU-wide
legal recognition of electronic signatures. However, this directive provides for some
exceptions such as contracts relating to land transactions, where, even though the
preparatory acts were carried out online, the final signature must be of the established
accepted paper based type. Although the directive intends to be technological neutral, it
establishes two types of e-signatures, simple and advanced

45
signatures. The latter type of signature has cryptographic assurance of the sender’s
identity, and the integrity of the text to which is attached. This differentiation has
attracted many criticisms for being biased in favor of advanced technologies, e.g.
smart cards. The directive has been criticized for being over-regulatory to the point
that it has restricted the development of ICT in this area. However, it can be argued
that the market needs to know when an e-signature is legally binding; yet the need
for legal certainty must be balanced with the risk of creating technological
restrictions and barriers to the development of e-signatures.
Consumer protection in the EU is still developing. The Directive on Unfair
Commercial Practice outlines ‘sharp practices’ such as pressure selling, pyramid
schemes, misleading marketing and unfair advertising. It is important to point out that
this directive, unlike the Directive on Consumer Rights (but in the same way as most
EU directives in the field of consumer protection), only provides minimum
harmonization. In order words, the Directive on Unfair Consumer Practice has set
minimum standards to contribute to the harmonization of consumer protection law
between the Member States, but allowing Member States to expand consumers’ rights
further. Additionally, this directive obliges businesses not to mislead consumers with
misinformation through acts or omissions. Through these directive consumers are given
the same protection against aggressive or misleading marketing whether they buy
locally or from other Member States. It also provides additional protections for
vulnerable consumers who are often the target of unscrupulous traders, such as rules
regulating advertising that targets children (P.Cortés 2011, pg. 13).
2.1.2. Practical application in European Union
The Commission conducted an analysis of a complete data set related to all
complaints lodged on the platform between 15 February 2016 and 15 February 2017.
The analysis focuses solely on complaints that are generated within the platform's
workflow and does not take into consideration complaints received by ADR entities
directly, i.e. outside the platform. The ODR platform is part of a wider framework
aiming to help the parties access qualified bodies for alternative dispute resolution.

ONLINE DISPUTE RESOLUTION: INTERNATIONAL APPLICATION AND LESSONS FOR VIETNAM

ONLINE DISPUTE RESOLUTION: INTERNATIONAL APPLICATION AND LESSONS FOR VIETNAM

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