(Luận văn) online dispute resolution international application and lessons for vietnam

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(Luận văn) online dispute resolution international application and lessons for vietnam

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MINISTRY OF EDUCATION AND TRAINING FOREIGN TRADE UNIVERSITY MASTER THESIS lu an va n ONLINE DISPUTE RESOLUTION: to gh tn INTERNATIONAL APPLICATION AND LESSONS p ie FOR VIETNAM d oa nl w nf va an lu Specialization: International Trade Policy and Law z at nh oi lm ul FULL NAME: NGHIEM LY TIN z m co l gm @ an Lu HANOI - 2020 n va ac th si MINISTRY OF EDUCATION AND TRAINING FOREIGN TRADE UNIVERSITY MASTER THESIS lu an ONLINE DISPUTE RESOLUTION: va n INTERNATIONAL APPLICATION AND LESSONS tn to p ie gh FOR VIETNAM w Specialization: International Trade Policy and Law d oa nl Code: 8310106 nf va an lu lm ul FULL NAME: NGHIEM LY TIN z at nh oi SUPERVISOR: DR HA CONG ANH BAO z m co l gm @ an Lu HANOI - 2020 n va ac th si i TABLE OF CONTENT REASSURANCE ACKNOWLEDGEMENT LIST OF ABBREVIATIONS LIST OF FIGURES SUMMARY OF THESIS RESEARCH RESULT INTRODUCTION Research rationale Literature review Research objectives 12 lu an Research questions 13 va Scope of research 13 n Research disposition 14 ie gh tn to Methodology 14 p CHAPTER 1: FUNDAMENTAL FRAMEWORK 15 1.1 History of Online Dispute Resolution 15 nl w oa 1.2 Online Dispute Resolution and characteristics 18 d 1.2.1 Definitions 18 lu nf va an 1.2.2 Characteristics 21 1.3 Methods of Online Dispute Resolution 22 lm ul 1.3.1 Group of fundamental methods 22 z at nh oi 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 z 1.3.2.3 Online juries/mock trials 29 @ l gm 1.4 Advantages and Disadvantages of ODR application 30 1.4.1 Advantages of ODR 30 co 1.4.2 Disadvantages of ODR 35 m an Lu 1.5 Basic conditions for ODR implementation 39 1.5.1 Awareness and trust to ODR 39 n va ac th si ii 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 lu 2.2.2.1 Government Initiatives in ODR 50 an va 2.2.2.2 ODR Professional Organizations 53 n 2.3 Application on ODR in China 58 to 2.3.2 Practical application in China 59 2.3.2.1 ODR and Domain Names Disputes: The ADNDRC 61 p ie gh tn 2.3.1 Legal framework of ODR in China 58 nl w 2.3.2.2 ODR and the CIETAC Online Dispute Resolution Center 61 oa 2.3.2.3 The HKIACODR Initiative 63 d 2.3.2.4 Other Initiatives 64 lu nf va an 2.4 Evaluations and future of ODR 65 lm ul CHAPTER 3: APPLICABILITY AND PERSPECTIVE OF ONLINE DISPUTE RESOLUTION IN VIETNAM 67 3.1 Statement of Online Dispute Resolution in Vietnam 67 z at nh oi 3.1.1 Factors for ensuring ODR application in Vietnam 67 3.1.2 The necessary of application ODR in Vietnam 69 z 3.1.3 Current situation of conditions to apply ODR in Vietnam 72 @ gm 3.1.2.1 Current situation of ODR in Vietnam 72 l 3.1.2.2 Advantages and opportunities 74 m co 3.1.2.3 Disadvantages and reasons 77 an Lu 3.2 Suggestions and solutions 78 CONCLUSION 82 n va LIST OF REFERENCES 83 ac th si 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 lu an Nghiem Ly Tin n va p ie gh tn to d oa nl w nf va an lu z at nh oi lm ul z m co l gm @ an Lu n va ac th si 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 lu me to complete my thesis, but also help me be more confident to improve my career an n va in the outside world tn to 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 gh p ie one of the most important and meaningful work in my life Hanoi, 09 July 2020 d oa nl w an lu nf va Nghiem Ly Tin z at nh oi lm ul z m co l gm @ an Lu n va ac th si LIST OF ABBREVIATIONS lu an n va 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 tn to ADNDRC Comprehensive and Progressive Agreement for Trans- gh CPTPP p ie Pacific Partnership The Center for Research in Public Law w CRDP Domain Name Dispute Resolution Center Electronic commerce nf va an lu E-commerce European Consumer Centers Network d ECC-NET oa nl DNDRC European Economic Area EU European Union EVFTA Vietnam Free Trade Agreement FTA Free Trade Agreements GDP Gross Domestic Product z at nh oi lm ul EEA z @ The Hong Kong Domain Name Registration Company co l Limited gm HKDNR The Hong Kong International Arbitration Centre ICANN The Internet Corporation for Assigned Names and Numbers ICT Information & Communication Technology m HKIAC an Lu n va ac th si IT Information technology KIDRC Korean Internet Address Dispute Resolution Committee The Kuala Lumpur Office operated by the Kuala Lumpur KLRCA Regional Center for Arbitration The Australia National Alternative Dispute Resolution NADRAC Advisory Council lu an 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 n va NCAIR tn to The Sports Dispute Resolution Center of Canada ie gh SDRCC Small and medium-sized enterprises p SMEs nl Top level domain names Uniform Domain-Name Dispute-Resolution Policy an United Nations Commission on International Trade Law nf va UNCITRAL lu UDRP d oa TLD Transfer Dispute Resolution Providers w TDRP United States of America USD United States Dollar WTO World Trade Organization z at nh oi lm ul USA z m co l gm @ an Lu n va ac th si 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 lu an n va p ie gh tn to d oa nl w nf va an lu z at nh oi lm ul z m co l gm @ an Lu n va ac th si 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 lu ODR definition and characteristics with practical lessons from some foreign countries an va with legal challenges, along with supplying recommendation on applying ODR in n Vietnam situation to bring a vision and opinion of the author based on academic gh tn to aspect The recommendations and solutions found in the thesis hopefully are going p ie to contributes a little to ODR development and growth in Vietnam d oa nl w nf va an lu z at nh oi lm ul z m co l gm @ an Lu n va ac th si 73 Lazada, Tiki and Sendo launch the feature of livestream on smartphone apps simultaneously, parallel with develop infrastructure and competition of delivery time to create new and substantial values to keep growth and reach sustainable development Along with the remarkable attributes, the policies of dispute resolution regulated by exchanges play as a vital role to get belief of both sellers and buyers, as well as make the transaction environment be safe with consumers’ right will be defensed Being one of the biggest E-commerce exchanges, Tiki is a typical case of applying online dispute resolution at early level in Vietnam It prioritizes negotiation and mediation among parties to remain relationship, belief of customers in Tiki lu an service quality Under the support policy of Tiki, the detailed claim mechanism runs va under the steps below: n Step 1: Customers complaint of goods, service of the seller that bought on tiki tn to - p ie gh exchange via one of the channels:  Email to: hotro@tiki.vn; w  Call to Hotline: 19006035 Step 2: Tiki Care team will receive claims, contact to clarify customers’ d - oa nl  Send letter to Tiki headquarter lu an requirements as soon as possible, and no more than working days since nf va receiving day Depending on quality and serious level, Tiki will have detailed - lm ul solutions to support customers Step 3: Tiki may require customers and/or sellers to supply information, z at nh oi evidences relate with transactions, products to check, clarify and find suitable solution Step 4: In case Tiki tried to settle, but the work is over its ability and authority, z - @ co l under law rule gm Tiki will suggest customer to submit the dispute to relating state authority Beside the forces of improve online dispute settlement implemented by E- m an Lu commerce exchange, professional legal organizations are also established to serve demands of ODR, in which Hanoi International Arbitration Center (HIAC) is a n va ac th si 74 remarkable case Combining the advantages of out-of court dispute resolution, the ODR system of HIAC allows organizations, persons to be able to reach the system at everywhere and every time with Internet connection, warrant the process of settlement happens quickly, conveniently with low cost The disputes are settled by HIAC system not depend on their value The disputes settled by the system includes ones rose by online and real transactions since June 2020 at www.hiac.vn To contribute to the development of ODR in Vietnam, HIAC intends to connect its ODR system with E-commerce exchanges to support relating parties, corporate with foreign ODR suppliers to resolve trans-boundary E-commercial conflicts, work with domestic organizations of arbitration and mediation to supply ODR solution and lu an other entities to expand branches of HIAC, or provide the protocol for parties who va want to run the system by themselves n a) ICT infrastructure matches ODR requirement basically ie gh tn to 3.1.2.2 Advantages and opportunities p In recent years, ICT infrastructures in Vietnam are being considered to invest nl w and improve, such as computers, ICT equipment and services, internet, etc ICT d oa suppliers currently are preparing both of labor, technology and equipment to an lu implement service of 4G LTE in recent years as well as 5G in the near future This force distributes significantly to the demand of online service development, nf va applications, especially online trading and transactions lm ul b) The advantages and effects of ODR play as motivating role to develop ODR z at nh oi system in Vietnam Flexibility, transparence, information control, removing cross-border barriers, z consolidating neutral and saving cost for dispute settlement under ODR system will @ gm be attractive with parties The characteristics may be considered by state authorities co l and companies to use ODR in Vietnam statement suitably ODR may be used as a competitive tool by enterprises, because belief is an important factor for customers to m an Lu penetrate into E-commerce market On another aspect, ODR is able to decrease or avoid some pressure in negotiations of difficult issues, as such authorization of courts, n va ac th si 75 applying laws, real destination to sue while all disputes will be settled on cyberspace Parties may come to a standstill initially and leave negotiation without agreement, when the issues arise An ODR system that is simple, efficient, effective, transparent and fair offers the hope of real justice in such disputes (R.A Brand 2012, pg.13) c) ODR reduces pressure of court system in Vietnam Vietnamese court system is always in overload (Thao Moc, 2016) with many complicated procedures, so ODR plays a role as the alternative method The effects of ODR will be more and more effective for cross-border transactions, when it can save time and cost, remove language differences and authorization that are considered lu as disadvantages when applying traditional dispute resolutions an n va d) ODR contributes Vietnam economic growth tn to Internet makes background for Vietnam in general, reduces time to keep up with ie gh global economy while commercial growth is always along with Internet and E- p commerce Besides, ODR encourages belief in E-commerce, it leads to E-commerce activities will increase, as well as digital economy will expand Economy w oa nl development will come along with growth of digital economy, as general From the d aspect, ODR plays a role as the motivation of Vietnamese economic growth lu ODR nf va an e) Vietnamese system law on E-commerce is the initial background to improve lm ul In the period of 2004-2016, legal framework related with E-commerce was z at nh oi finished basically with 14 laws and 18 by-law documents with the orient of clearing E-commerce activities, regulate rights and obligations of E-commerce-related parties, and increase administrating role of state authorities simultaneously Although there z gm @ is not regulation governs ODR directly in Vietnam, current legal documents have made base to build the method in coming time, with the reason below: l Firstly, Vietnamese law admits legal value of E-messages equivalent to written m co - an Lu documents, along with detailed regulation of E-signature (token) to identify signing person and verify his approval for the signed message This is an n va ac th si 76 important factor to set up ODR mechanism, while submitting and its evidence are in digital form - Secondly, Decree 52/2013/NĐ-CP on E-commerce to govern its commercial activities has had terms on dispute resolution The Decree regulates specifically parties’ responsibilities in E-commercial transactions, and list feasible methods to settle disputes arise from actions - Thirdly, Law on consumer protection, issued on 2014, supplies terms on settling disputes apply for all kinds of consumer, including buyers, online services with orders and procedures are regulated clearly of settling dispute among consumers and organization/person who trading commodity, through lu an four methods are negotiation, mediation, arbitration and litigation (for disputes va with value less than 100 million Vietnam Dong) n tn to - Fourthly, Civil Procedure Code, issued in 2015, shows some new terms settlement at court, e.g Article 94 and 95 in this law added the definition of p ie gh relating to electronic database and IT application for process of dispute Finally, ability of enterprises is protocol for ODR development E-commerce oa nl - w “electronic data” as the evidence can be collected d improve dramatically with various forms, such as website for selling, trading lu an exchange, auction and other services are always attached by strict legal nf va regulations But Vietnamese enterprises themselves actually not follow the dispute z at nh oi lm ul regulations completely, especially forms of E-contract that lead to the risks of In accordance with the Report of Vietnam E-Business Index 2019, sellers on social networks are mainly households and individuals Most of them have not z grasped proper knowledge about the regulations on E-commerce, so they have @ gm no sense of compliance with the laws, including the provisions of the Decree l on E-Commerce Whereas, buyers on social networks are often individuals, m co they usually enter into the contract because they trust the seller or the an Lu community Transaction value is usually not much When a dispute happens, it is difficult for them to receive support from the social network provider, and n va ac th si 77 at the same time, buyers not actively exploit the support from other organizations such as state management agencies on consumer protection, the Standard and Consumers Association, arbitration or court (VECOM 2019, pg.13) Besides, Vietnamese enterprises usually not care fully enough about electronic data in data management and processing, person in charge is not specialized, that leads to issues of confidentiality and privacy Disputes will appear with high possibility, and ODR will have more chances to be applied 3.1.2.3 Disadvantages and reasons lu a) Vietnamese culture makes significant barrier for ODR development an n va Apprehension is set up in Vietnamese deep mind for a long time ago, they also tn to not care so much for enterprise’s responsibility when buying a defected product with low value, it leads to most of them will not sue when disputes arise Besides, gh p ie ODR is a new definition with Vietnamese consumers, mostly they want to take w dispute to court instead of settling disputes on cyberspace Unbelievable evidences, oa nl untrusted judgement, or lack of body language and nonverbal behaviors may appear in their mind are the reasons make Vietnamese consumers not choose ODR as d an lu priority nf va b) Vietnamese enterprises’ unwillingness reduces demand of ODR application lm ul Speed of E-commerce growth goes up significantly in Vietnam, but there are z at nh oi not many enterprises match standards to apply ODR in their business activities The standards are not only infrastructure, but also technical labor Therefore, enterprises not dare to put themselves at risks by settling disputes publically and transparently z transactions l gm @ c) The barrier of language meanwhile applying ODR for international m co The number of E-commercial websites supply fully with updated information an Lu in Vietnamese and English are not really popular in Vietnam, it is quite difficult for partner to check ODR statement In contrary, most of websites all over the world just n va use English and their tongue languages make Vietnamese consumers use their supply ac th si 78 d) Lack of synchronization in policies and laws Personal information confidentiality is importance to apply and extract Ecommerce Many legal documents have regulations about the protection of personal information such as the Civil Code, the Criminal Code, the Law on Information Technology, the Law on Network Information Safety, the Decree on E-Commerce, Decree stipulating penalties for administrative violations in the postal field, telecommunications, information technology, and radio frequencies However, the situation of collecting, using, dispersing, illegally trading personal information is still widespread lu 3.2 Suggestions and solutions an n va Profoundly affected by the globalization, convenience of the Internet, so far, tn to Vietnam's e-commerce policies have paid little attention to geo-economic factors and narrowing the digital divide between regions ie gh p The overall E-commerce Development Master Plan for the 2016-2020 period has partly paid attention to this factor However, it just basically refers to improving w oa nl the quality of state management, organizing short-term training courses for d enterprises in localities and proposing support of E-commerce development in some lu an key economic regions National E-commerce development program in the 2014 - nf va 2020 period assigned local state management agencies for E-commerce to build and lm ul organize the implementation of annual E-commerce development projects with these main contents (VECOM 2019, pg 19): z at nh oi 1) Constructing and Developing E-commerce infrastructure; 2) Propagating, Disseminating and Raising awareness; z @ gm 3) Training and Developing human resources; co l 4) Developing E-commerce products and solutions m According to analyze of advantages for ODR applied in Vietnam currently, in an Lu general, ODR can be applied meanwhile the initial conditions of ICT, law can be matched basically in Vietnam, as well as the the benefits from ODR will be n va ac th si 79 motivations for parties are willing to use Although there are many barriers arise when applied ODR practically as a new tool, it is not meaning as insurmountable In process of analyzing disadvantages of ODR, it showed the “belief” of ODRrelating parties behind the difficulties Therefore, to apply ODR in Vietnam context, parties should build belief in E-transactions and arising dispute firstly, belief building up takes time and will not be easy as well The solutions and forces of parties should be implemented simultaneously a) Suggestions for Government Playing role of policy maker, government has a great responsibility for issuing lu an law rules to implement, introduce step by step to resolve legal issues arise when n va applying ODR to built belief of parties The regulations will not replace traditional tn to methods of dispute resolution, but supply many methods for choosing to be the most convenience with each form of disputes ie gh p Courts, Commercial Arbitration centers should apply ODR actively Although the documents of direct introduction have not issued, the authorities can build their w oa nl own Code of conduct to facilitate ODR application Judges, arbitrators and mediators d should reach actively and get knowledge of ODR, interpret legal regulations flexibly lu nf va an and suitably with current situation to improve ODR in Vietnam b) Solutions for enterprises lm ul E-commercial enterprises should be the pioneers of ODR application in their z at nh oi business activities, they can commence with little disputes with low value to build belief of their partners Therefore, arming legal knowledge and technical infrastructure, setting up ODR system little by little up to complete automation, z French, Spanish, etc into ODR systems l gm @ besides, popular foreign languages should be invested such as English, Chinese, m co ICT suppliers also play an important role, because improving and updating an Lu ODR infrastructure is prerequisite The ICT companies should synchronize ICT infrastructure not only in central cities, but also other cities and provinces in Vietnam, n va facilitate enterprises and consumers to be able to access Internet the most ac th si 80 conveniently The E-Business Index report for many consecutive years shows that most E-commerce activities take place in the two largest cities of the country – Hanoi and Ho Chi Minh City and some nearby provinces such as Bac Ninh, Vinh Phuc, Dong Nai, Binh Duong and municipalities such as Hai Phong, Da Nang and Can Tho Online business activities in most other provinces are still weak and there is a risk of falling behind compared to the two leading cities According to an estimate, Hanoi and Ho Chi Minh City accounted for 70% of E-commerce transactions E-commerce scale in other localities, especially in rural and remote areas is very small Meanwhile, about 70% of the population lives in rural areas The rural area has a great potential consumption and is also a supply of various products suitable for online sales lu an It is necessary to narrow the digital divide between localities, especially to va n support rural areas to sell online in order for E-commerce to develop quickly and tn to sustainably It’s time for state management agencies as well as professional social ie gh organizations to have synchronous policies and solutions to turn E-commerce p opportunities into reality in every locality, enterprise, and citizen In addition to nl w propagating to local consumers to exploit the benefits of online shopping, the key oa factor is to actively implement activities to support small and medium enterprises and d households in rural areas to sell goods and provide services online an lu c) Solutions for consumers nf va lm ul Currently, Vietnamese consumers are able to reach E-commerce every times in every where basically, just with smartphone or computer in their hands E- z at nh oi commercial as well as ODR development are undeniable and inevitable, and not science fiction fantasy, it is real and affect to consumers’ life everyday z Consumer need improve their own ICT skills and knowledge to avoid fraudulent @ l gm troubles while they join online shopping or transactions Besides, consumers need to learn and increase awareness of laws and their co m procedures Taking advantage of available mechanisms of dispute settlement, an Lu including traditional and alternative resolution, to protect own rights actively when n va ac th si 81 disputes arise, update progressively information and policies of ODR application to catch up trend and integrate domestic and global E-commercial market efficiently lu an n va p ie gh tn to d oa nl w nf va an lu z at nh oi lm ul z m co l gm @ an Lu n va ac th si 82 CONCLUSION By the Master thesis, the author consolidated definition, characteristics, strength and weakness, along with proved the ability of implementing ODR in reality with typical applications from foreign countries that are famous for applying the advanced kind of dispute resolution Through the process of completing the thesis, although ODR is still new field in the system of dispute resolution in Vietnam, the author found the irreversible trend of ODR in the era of E-commerce and digital transformation, as well as benefits ODR bring for Vietnam not only in legal aspect, but also in economic development lu an Applying ODR efficiently is one of the most important factor to build belief of n va involved parties and motivate E-commerce development in Vietnam Because private tn to and complicated characteristics of ODR, the suggestions and resolutions the author proposed should be always implemented simultaneously for gaining positive results gh p ie Improving management in administrative works, monitoring, controlling, penalize w violating websites, etc they all are not suitable resolutions to set up right procedures oa nl and promote ODR operating efficiency To resolve adequately weaknesses of ODR activities, it need the combination of both of establishing professional system of ADR d an lu supplying organizations to support ODR activities, and setting up consistent legal nf va documents suitable with international and regional standards and customs of E- lm ul commerce and ODR Furthermore, national information gate should be built to receive claims, requirements of dispute resolutions, expanding awareness of rights z at nh oi and obligations of parties in E-commercial transactions, especially for consumers, along with upgrading ICT infrastructure comprehensively in provinces of Vietnam z will be indispensable condition to implement ODR efficiently m co l gm @ an Lu n va ac th si 83 LIST OF REFERENCES A Articles/Papers Albornoz, “Feasibility analysis of online dispute resolution in developing countries”, University of Miami Inter-American Law Review, Vol 44, No 2, 2013 Arthur Pearlstein et al, “ODR in North America”, 2009 CNNIC, “Statistical Report on Internet Development in China”, 2019 Ethan Katsh, “Online Dispute 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