In the age of the internet, disputes can be settled on-line

Vamilson José Costa

The development of new technologies has been influencing not only global economy, but also the way people establish legal relations. Each day, the internet enhances its influence as a channel for several deals to be closed between parties from different locations. In these cases, the actual presence in person of the signatory parties is no longer needed. On the heels of this process, an alternative dispute resolution method arose: the “on-line dispute resolution (ODR)”, meaning a method to solve disputes on-line. Among the advantages of the ODR, one could emphasize the simplicity, convenience and cost reduction – mostly when the parties involved in the dispute are physically away from each other, once there are no expenses with travels, meetings, long distance calls (specially in Brazil, where the amounts involved in a conventional arbitration may be considered significant). The speed of the proceeding is also a highlight: there is less bureaucracy compared to the other dispute resolution methods and it is possible for all applicable measures to be taken on-line.

On-line arbitration is not yet widely spread in Brazil, but there are several websites that already provide this service internationally. Many times, the system used is offered by the supplier of the on-line arbitration service itself. Therefore, the party that hires the service, theoretically, is bound to the on-line arbitration clause at the moment it accepts the adhesion contract made available on the supplier’s website.

It is important to notice that the validity and effectiveness of the on-line arbitration have been discussed due to some issues, which may cause the on-line arbitration clauses to be considered abusive, illegal and thus null. One of the controversial issues is that the simplicity and speed of the on-line proceeding may lead to violation of constitutional and legal rules that assure the due process of law in the scope of arbitration. Another issue refers to the validity of the arbitral award issued electronically, once most laws and conventions on the matter require arbitral awards to be rendered by means of written documents. Lastly, it is important to bear in mind the need to adjust the acceptance of the on-line arbitration clause to the consumer law context, which is still under discussion by the Brazilian Judiciary.

The Law No. 9307/96, that governs arbitration in Brazil, for instance, provides that the arbitration award must be expressed in a written document (article 24). Accordingly, the New York Convention (Convention on the Recognition and Enforcement of Foreign Arbitral Awards – New York, 1958), signed by Brazil, does not consider decisions and agreements produced by electronic means to be “written documents”, as per joint reading of its articles 2(1), 2(2) and 4(1).

However, one must not disregard the fact that, in an environment of increasing development and use of internet for commercial purposes, ODR may become a valuable and useful method to solve matters out-of-court in the future. In order to cease doubts as to its regularity, it is necessary to review the existing regulation on the matter so to adjust it to the on-line system.