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Remote arbitration: online dispute resolution

29 Feb 2024 - International Arbitration - Min Read 3 min
Remote arbitration: online dispute resolution

Remote arbitration, also known as online arbitration or e-arbitration, represents an innovative method of dispute resolution that harnesses digital technologies to optimize and expedite the arbitration process itself.

Technically, it is not a distinct form of arbitration but rather a mode of arbitration conducted remotely, utilizing information technology to overcome the barrier posed by physical distances between each party.

Despite certain constraints limiting its implementation, its use is on the rise, thanks to the advantages it offers in terms of efficiency, convenience, and speed. This was particularly evident during the pandemic period when telematic processes were extensively tested.

Regulatory requirements and validity of remote arbitration agreements

The New York Convention of 1958, adopted in Italy through Law No. 25 of 1994, recognizes the validity of arbitration agreements “in writing” without specifying the form of the document. This provides a flexible framework open to interpretation by national legislations, provided that certain conditions ensuring authenticity and integrity are met.

Legislative Decree No. 82 of 2005 adopted the European Directive 2000/31/EC on electronic commerce, equating certified and digital electronic signatures with handwritten signatures. Article 836 of the Italian Code of Civil Procedure currently acknowledges the validity of arbitration agreements signed with a certified or digital electronic signature.

Italian law also accepts “electronic writing” for arbitration agreements provided that each party has expressed their intention to accept it and that the requirements prescribed by the applicable law are met.

The favorable inclination towards the development of remote arbitration is also evident in the recent reform of the civil procedure code, which has envisaged a significant restyling of arbitration practices.

Aside from Italy, countries such as France and Germany, have unequivocally acknowledged the validity of electronic arbitration agreements, while others, like the UK, have imposed stricter requirements. In addition, there are exemplary cases of some national legislations, such as those of the United States, Singapore, and Hong Kong, which have adopted specific provisions for remote arbitration, promoting its expansion.

Advantages of Remote Arbitration

Remote arbitration utilizes information technology tools for managing the arbitration process, and similar to conventional arbitration, procedural rules can be tailored to meet the needs of the parties involved.

The advantages can be summarized as follows:

  • Efficiency, simplicity, and speed: proceedings and document exchange occur online, eliminating downtime and bureaucratic delays associated with traditional arbitration.
  • Cost reduction: expenses related to travel, accommodation, and logistics for parties, their lawyers, and arbitrators are reduced.
  • Accessibility: parties can participate from anywhere and at any time, fostering inclusivity and flexibility.
  • Transparency of digital platforms: telematic arbitration procedures take place on dedicated digital platforms that ensure the traceability and transparency of all actions.
  • Immediate communication: communication between parties and arbitrators is facilitated and expedited through instant messaging and video conferencing tools.
  • Speed of decisions: streamlining the process and focusing on substantive issues enable faster arbitration decisions.
  • Greater flexibility: parties can agree on procedural modalities that best suit their needs.
  • Security of electronic signatures: the use of advanced electronic signatures ensures the authenticity and integrity of documents.
  • Cybersecurity: digital platforms adopt advanced security measures to protect parties’ sensitive data.

Limits of remote Arbitration and Solutions

The diffusion of remote arbitration is still hindered by some critical points, especially concerning the validity of remote arbitration agreements.

The main limits of remote arbitration agreements are:

  1. Digital divide. Not all parties may have access to the necessary technology to participate in remote arbitration.
  2. Authentication and cybersecurity issues. Electronic signatures and data security are crucial in order to ensure the integrity and authenticity of the agreement. Some national legislations, whilst allowing electronic signatures, may require specific requirements for its validity in arbitration.
  3. Lack of uniformity. National and international regulations on remote arbitration are still in the developmental phase, and there is no uniform regulatory framework.
  4. Interpretation of laws. the interpretation of existing laws concerning traditional arbitration may not always be applicable to remote arbitration.

The development of new technologies and the adoption of specific regulations at national and international levels will contribute to strengthening the validity and reliability of remote arbitration, promoting its growth as an effective tool for dispute resolution, with cost savings benefits for the parties.

For further information and assistance, do not hesitate to contact our lawyers from our International Commercial Arbitration Department at Boccadutri Law Firm.

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Calogero Boccadutri

Calogero Boccadutri is the Managing Partner of Boccadutri International Law Firm. He has trial experience in Forex, Personal Injury and Administrative litigation.



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