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Challenges in E- Arbitration During covid 19 and Recognition under different statutes.
Challenges in E- Arbitration during covid 19 and Recognition under different statutes.
Covid 19 has adversely affected different industries differently, and Arbitration is no exception to that. The social-distancing measures pushed the disputing parties involved in arbitrations to implement and conduct proceedings remotely and adopt creative and technological solutions. Virtual arbitration has become quite prevalent, and with increasing dependency on technology, there has also been a significant increase in challenges faced while conducting the arbitration proceedings.
Challenges-
A survey conducted before Covid-19 in 2018 by Queen Mary University in collaboration with White & Case[1] reveals that the main concern regarding IT usage in international arbitrations might be the lack of familiarity with technology infrastructure (including the cost attached to it) that weighs in a while opting for in-person proceedings.
- Data Security and privacy concerns
Parties often prefer arbitration because of this primary benefit of confidentiality attached to it. But virtual arbitration has made it difficult to protect confidential information and thereby created privacy-related issues. Frequent hacking and data leaks diminish the confidence of parties in virtually run arbitrations and raise due process concerns.
- Costs
Cost is one of the crucial factors attached to arbitration, and virtual arbitration has increased by this factor. Since arbitration proceedings cannot be conducted on any platform, several institutions have custom-built platforms for virtual proceedings, which have added to the cost of arbitration. In addition to the media costs towards using appropriate technology such as internet (with adequate bandwidth), virtual data-room, video-conferencing platforms/facility, transcription, translation, proper hardware (like screens, headphones, wide-angle and high-quality cameras), etc. have made it a costlier affair.
- Examination of witnesses
The examination of witnesses has also become difficult since the tribunal cannot judge the validity of statements using different tricks like witnesses' body language and facial expressions because it becomes tricky in virtual proceedings.
Validity of E- arbitration as per DIFFERENT ACTS
- Arbitration and Conciliation Act, 1996
The Arbitration & Conciliation Act, 1996 (“Act”) does not mention whether the arbitration proceedings can be conducted through virtual means.
Section 24 (Hearings and written proceedings) of the Act: (a) entitles the parties to have oral hearings or waive this right if they so deem fit; and (b) empowers the arbitral tribunal to decide on the need for oral hearings, in case there is a lack of agreement between the disputing parties.
Under Section 18 (Equal treatment of parties) of the act, the essential crux of due process: (a) treatment of parties with equality, which leads to an interpretation that the proceedings can be held virtually keeping in mind the essence of section 18 of the act.
- Information Technology Act, 2000
Virtual arbitrations entail deliberations, arguments, submissions, evidence, notices, hearings, and orders, all in virtual or electronic form. The Information Technology Act, 2000 (“IT Act”) under Section 4 (Legal recognition of electronic records) and Section 5 (Legal recognition of electronic signatures) allows virtual arbitration proceedings.
- Indian Evidence Act, 1872
Section 65B (Admissibility of Electronic Records) of the Indian Evidence Act, 1872 provides the necessary legal validation to an electronic record and virtual proceedings.
In conclusion, it can be said that the flexibility of arbitral procedures and advancement in technology has imbued the sector with the capacity to function even under the present situation. Though it still needs to overcome the challenges listed above.
This Article Does Not Intend To Hurt The Sentiments Of Any Individual Community, Sect, or Religion, Etcetera. This Article Is Based Purely On The Authors Personal Views And Opinions In The Exercise Of The Fundamental Right Guaranteed Under Article 19(1)(A) And Other Related Laws Being Force In India, For The Time Being. Further, despite all efforts made to ensure the accuracy and correctness of the information published, White Code VIA Mediation and Arbitration Centre shall not be responsible for any errors caused due to human error or otherwise.
- Virtual arbitration has become quite prevalent and with increasing dependency on technology, there has also been a significant increase in challenges that are being faced while conducting the arbitrat
- Frequent instances of hacking and data leaks not only diminish the confidence of parties in virtually run arbitrations but also raises due process concerns.
- Cost is one of the crucial factor attached to arbitration and virtual arbitration have increased by this factor.
