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This article has been written by Gayathri pursuing the Introductory Course – Legal Writing For Blogging, Paid Internships, Knowledge Management and Editing Jobs from LawSikho. This article has been edited by Aatima Bhatia (Associate, Lawsikho) and Ruchika Mohapatra (Associate, Lawsikho). 


Online dispute resolution (ODR) is a branch using technology for the resolution of disputes of parties involving negotiation, mediation, arbitration or a combination of the above by augmenting the innovative technologies in the process. The  techniques of resolution in which the parties have full procedural control on methods and the third party is in control of the process and the  (Rule C, 2007) outcome. The primary method of resolving the dispute is complemented with Information and Communication Technology (ICT) (Cortes P, 2009). The procedures like filing at initial stages, the appointment of neutral, process of evidentiary, oral hearings if needed, discussions and the rendering of binding settlements from beginning to end, respecting the due process of ADR principles are all online.

Origin & development of ODR Mechanism

The Internet is a vital facilitator in today’s communication. The emergence of the Internet took place in 1968 by the US military network called ARPANET. In 1990, the Defence Advanced Research Projects Agency (DARPA) — transformed from ARPA by completing the development of a network for civilians. US federal institutions managed the Internet till it acquired the status of a public good in 1991 (Russell  A. L, 2014; Salus  P, 1995) and grew to the most powerful medium in the 21st century. The network fulfills many functions such as being a source of information, a communications tool and a global trading platform and has also become the engine for introducing modern technological solutions. 

The Internet has an important role in public life, including law. Its fast development is causing many positive phenomena. This has also highlighted the non-compliance of the legal framework with new realities (which comes in the scope of intellectual property rights). The global character of the Internet changed the approach regarding the access of information impacting the copyright and press law. In the absence of territorial boundaries, the private international laws became outdated and necessitated the introduction of new regulations ((Directive on electronic commerce, 2000). The non-compliances of settlements in the national & international commerce forced us to look at the statutory frameworks and out of court settlements in case of any disputes. The online dispute resolution evolved in the process.

The Indian government of the day feels that the method promises from its adoption of the Digital India scheme. The necessity of ODR emerged in the early 1990s next in 1992 as the ban on internet commercial activity was removed in the United States. The disputes became proportional to the online commercial activities which needed to be resolved fairly. In 1996 a conference on online dispute resolution was sponsored by ‘The National Centre for Automated Information Research (NCAIR)’, that led to an experimental project with the Virtual Magistrate. Subsequently in 1997 the Centre for Information Technology and Dispute Resolution was established & E-bay requested for the building of the ODR system. This pilot project was a great success. This is confirmed by data that show a constant increase in the number of internet users in India.

Cases pending in courts of India

As per the National Judicial Data Grid (District & Taluka Courts of India) ( (National Judicial Data Grid, 2021), Table 2 & Figure 2 depicts the pending Civil & Criminal cases as on 14.10.2021. However, it may be noted that the majority of the Pending Civil cases of 26.65% can be addressed by the alternate methods of the judiciary and the criminal cases should be addressed by the judiciary only. The process relaxes the over – pressured courts.

Information Technology – its components & its law

IT integrates the acquisition of data, its storing, processing & the information dissemination at various utilization levels with the help of computers & communication technology. The information accessibility is restricted using the technologies. Suitable amendments in the laws were made in the Information Technology Bill 1999, by Government of India to encourage ecommerce trading that led in the creation of the legal rights & the obligations. After the Presidents accent it evolved as the Information Technology Act 2000. Further with the amendments in the Indian Penal Code, the Indian Evidence Act, 1872, the Banker’s Book Evidence Act, 1891 and the Reserve Bank of India Act, 1934 and for matters connected therewith or incidental thereto, gave an exponential growth of e-commerce business.

Table 1- Internet Users Worldwide & in India
No. of users in (x 1000) millionsNo. of users in (x 1000) millions

Figure 1- Internet Users Worldwide & in India
Table 2- Pending Cases in Indian District & Taluka courts as on 14.10.2021
Sl.NoParticularsPending Cases 
10 to 1 Year3567237983955613406793
21 to 3 Years3215286821201411427300
33 to 5 Years162214544606406082785
45 to 10 Years159170443459455937649
510 to 20 Years54536421402932685657
620 to 30 Years114299362353476652
7Above 30 Years362806365099930
Figure 2- Pending Cases in Indian District & Taluka courts as on 14.10.2021

Structure of the IT Act 2000

The Act comprises 13 chapters having 90 sections. Sections 91 to 94 deals with the Information Technology Act, 2000 and conjointly read with the   Amendments of The Indian Penal Code 1860, The Indian Evidence Act 1872, The Bankers’ Books Evidence Act 1891 and the Reserve Bank of India Act 1934). The Act deals with authentication of electronic records, digital signatures, electronic signatures etc. & elaborate procedures for certifying authorities (for digital certificates as per Information Technology Act -2000 and replaced by electronic signatures amendment in the Act of 2008). The offence of data theft and the adjudication process and appellate procedures are discussed. Some of the well-known cybercrimes and lay down the punishments are also described. The concept of due diligence, the role of intermediaries and some miscellaneous provisions are described. Rules and procedures are laid down in a phased manner. Further the definition of private and sensitive personal data and the role of intermediaries, due diligence were made in April 2011.

Online Dispute Resolution- an integrated model

This is receiving growing interest in the dispute resolution and legal arenas. The literature published to date highlights the great promise offered by ODR processes and its unique boundary-less cyber characteristics. Nevertheless, even proponents recognize that, as with any emerging phenomenon, there are inevitable pitfalls and challenges to consider when evaluating ODR’s potential societal contribution in both general and specific ODR procedures. As with traditional dispute resolution procedures, ODR researchers have been attempting to develop a clear and measurable set of criteria.

Standard criteria for evaluating ODR

The negotiation theory is divided into six categories, as depicted in Figure 3 are used to develop new criteria in ODR evaluation & assess the advantages and disadvantages for the removal of blocks if any. 

Four critical dimensions of ODR

An essential building block is to provide a theoretical framework for ODR assessment from conventional face-to-face dispute resolution and to develop hypotheses for core dimensions, distinguishing from one form to another and is depicted in Figure 4. 

Figure 3 -Standard criteria for evaluating ODR

Theoretical framework for assessing ODR: applying bargaining and negotiation theory 

Number permutations & combinations of themes emerge from the standard criteria of bargaining which leads to five central ODR dimensions. The existing ODR literature has not attempted to incorporate the various evaluation criteria into a coherent and integrated framework. The overall bargaining & negotiation theory is depicted in Figure 5.

ODR : usage of   Artificial Intelligence & fuzzy logic

Online resolution methods of disputes become necessary with the development of e-commerce, which applies information and communications technology, taking place partly or entirely online. Using the ADR process the disputes are resolved from cyberspace as well as outside it. For resolution four parties have to be incorporated: initiating party (a claimant), a respondent, a neutral party and a technology-based intermediary. The ODR process is initiated by a party when requested to start a new dispute resolution. Initiating party provides information about other participants, who are subsequently informed and asked if they are willing to participate. With the mutual agreement of all the parties involved, the system gathers information and details about the dispute, such as monetary values, the expectations and feelings of parties, and the documents as evidence. Due to the involvement of emotions involved, this phase is the hardest for autonomous ODR providers. Next all collected information is analysed and the system (human or technology) determines the result. The technologies are used for finding the solution of the dispute. Lastly the award is presented to the parties. The algorithm and strategy are studied for further improvement.

The procedure of ODR

 ODR mostly consists of mediation (as per 74 % of ODR providers), arbitration (as per 40 % of ODR providers), negotiation, client counseling or their combination. The procedures differ in the degree of control of the parties. With e-Negotiation (electronic negotiation) the parties are in full control during the process, deciding whether the outcome is accepted or rejected. On the other hand, settling the dispute in court gives the parties almost no control over the outcome. 

The parties are suggested to start with negotiation, if necessary, continue with mediation and finally arbitration. If the dispute is still not resolved, the failure is reported and another 

Figure 4 Four Critical dimensions of ODR
Figure 5 – Types of Bargaining
Figure 6- Degree of control of Parties in Dispute Resolution System
Table 3 AI Application used for different Legal areas 
Sl. NoProcessAI Applications
1Electronic discoveryCatalyst, DISCO, OpenText
2Contract analysisKira, RAVN, Seal, LawGeex, Leverton, eBrevia
3Legal researchROSS, RavelLaw, Judicata, CaseText
4Document automationPerfectNDA
5Analytics & PredictionLex Machina, Premonition, RavelLaw
6Electronic billingBrightflag, Smokeball
7Intellectual propertySmartShell, ANAQUA Studio, TrademarkNow
Table 4 AI Application used for ODR Legal areas 
Sl. NoSystem CategoryAI Applications
1Virtual mediation roomsECODIR, Mediation room, Mediationline
2Expert systemsCODR
3eNegotiationFamily_Winner, Inspire, SmartSettle,
4Decision support systemsSplit-Up
6Blind biddingCyberSettle
7Document managementNegoisst
8Customized systemseBay
9Arbitration systemsWord & Bond

Conclusion & recommendations 

With the exponential growth of e-commerce that led to the  global consumer transactions on the internet also raised in disputes between the parties from different jurisdictions. Innovative mechanisms such as ODR that include techniques of arbitration, mediation are extremely useful. This dispute resolution in India ( is in its infancy stage but it is gaining prominence with the enactment of the Information Technology Act, 2000 as legal recognition is given to e-commerce and e-governance.  The reformulation of arbitration laws in accordance with UNCITRAL Model led to the successful ODR system encouraging e-commerce and timely dispute resolution. As the participation of users are governed by the contract the alternate dispute resolution should be included in the contract. The Consumer Protection Bill 2015, which includes provisions for mediation, sees the proper and impartial procedural follow up. ODR is the best alternative way as it reduces the loss of time often that causes loss of opportunities. It also ensures the smoother functioning of the whole process. As a result, ODR with the sophisticated tools is a good resource for dispute resolution.

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