International Conference on
Dispute Resolution in Electronic Commerce
organized by the WIPO Arbitration and Mediation Center
Geneva, November 6 and 7, 2000
OPENING STATEMENT
by
L. Yves Fortier, C.C., Q.C. (Footnote 1)
"INTERNATIONAL COMMERCIAL ARBITRATION AND E-COMMERCE:
PLUS ÇA CHANGE, PLUS CEST LA MÊME CHOSE"
The breathtaking pace of change wrought by what some people refer to as "the third (the technological) revolution", over the last quarter-century, has left many people and industries gasping for breath. Thanks largely to great leaps in information technology, the modern commercial community encompasses far more players living and working in more far-flung regions of the globe, rapidly amassing greater fortunes trading in greater quantities of goods, services and ideas than ever before. For international arbitrators and other dispute resolution providers providers of services key to the success of this or any commercial age the challenge to remain in step with rapid change is particularly important. Fortunately, in my view, it is a challenge that goes to the heart of what we do, and have been doing for centuries.
On 13 October 2000, in an article entitled "Lies, Damned Lies ... and Web Valuations", the Financial Times wrote: (Footnote 2)
"The internet has turned out to be one of the most powerful forces shaping business for decades. But it has also proved to be fertile ground for speculation. Entirely new markets have been promised, with entirely new ways of doing business and entirely new ways of making money."
There is no doubt that the advent and proliferation of electronic means of conducting commercial transactions a.k.a., "e-commerce" have forced a reassessment of how business is carried out. Electronic commerce has also greatly accelerated the convergence of national and regional market forces toward a truly international, indeed global economy. Globalisation influences all aspects of modern life, transforming our perceptions, ideas and expectations of the world we inhabit. In the view of some, globalisation implies the end of human history; others see it in a more benign fashion: merely as the end of geography. (Footnote 3)
However one approaches the subject, it is undeniable that these developments have engendered a new generation of commercial practices, and hence of commercial issues, which, if they are not entirely unique to the world of e-commerce, nonetheless require solutions tailored to fit this new mode of doing business.
Whether the question is the protection of domain names, transactional security, the establishment and use of crypto-secured digital identities, or any other issue arising in the context of electronic commercial transactions, the need for efficient and effective dispute resolution cannot be overstated. This is all the more true in light of the fact that the march of technology continues to compress not only the time actually - perhaps one should say "virtually" - required to conclude agreements and effect transactions but, perhaps more importantly, our perceptions and expectations regarding what are, and are not, acceptable delays. Clearly, this phenomenon of "time compression" applies equally to the concept and the means of resolution of electronic-commercial disputes. As an illustration of this, one need look no further (or further back) than the first ICANN (Internet Corporation for Assigned Names and Numbers) award, which was rendered within a few days of the appointment of the arbitral panel and, excluding attorneys fees, cost a mere US$ 1,000. (Footnote 4) Nor is this sort of process unique. Increasingly, when it comes to adjudicating conflicting claims to electronic identity and domain, it reflects the norm.
Beyond this sort of new issue susceptible of resolution by new means, I suspect that e-commerce promises, perhaps most significantly, an explosion of what for lack of a better word might be called old-fashioned issues arising simply by virtue of the fact that modern technology has enabled an almost inconceivable expansion in the number of possible commercial transactions taking place at any given moment, any one of which is liable to result in a dispute of some sort. For example, during a sample two-week period, 225 buyers and sellers from eBay (the largest internet-based auction company) filed complaints and initiated arbitration relating to their transactions. (Footnote 5) Knowing that the overall volume of "C2C" (consumer-to-consumer) transactions remains insignificant when compared to "B2B" (business-to-business) e-commerce, this number is in fact more horrifying than it sounds. (Footnote 6)
If one is not to succumb to the tendency toward hyperbolic rhetoric associated with all things "e", however, or to the speculation (all too often un-rewarded) that it prompts, a more considered assessment is in order. This is, one presumes, why we are all here today.
Whether or not electronic commerce has truly revolutionised business is a question that I leave to others, better qualified than I, to answer. Similarly, the question of whether or to what extent traditional business or legal models (for example, as they relate to intellectual property) remain sound, or require complete overhaul, in an economy based, more than at any time in history, on intangible assets: where knowledge and information constitute both primary resource and finished product. What I will state, however, is that in my view, as a long-time practitioner and arbitrator of international commercial disputes, e-commerce and, more generally, information technology, may change the way some of the business of dispute-
resolution is conducted, for example by imposing specialised techniques, such as on-line arbitration. They will likely generate increased demands for quicker justice and foster greater use of so-called fast-track methods of dispute resolution. They will certainly add to the type of disputes requiring expert adjudication. But they have not, and will not, fundamentally alter the job of the international commercial arbitrator any more than the transition from the ancient law merchant to the modern Uniform Commercial Code, or from steam- to electric-powered transportation fundamentally altered the arbitrators job.
Of course, the arbitrator if he or she is to remain an expert purveyor of a justice that is uniquely attuned to the interests of parties in a particular industry will necessarily be required to learn new tricks. He or she must understand the changing environments within which new enterprises incubate, operate and compete. He or she will be required to adapt traditional notions regarding such concepts as "assets" or "value" to the intangible realm in which untold billions of dollars worth of business is transacted today. And yes, he or she in this case, most definitely he will have to become comfortable with new technologies from web crawlers to wireless application protocol to, finally, the VCR.
Yet it was not that long ago theres a good reason why for some of us it seems only yesterday that the VCR was a mystery, the fax machine a miracle and the original Macintosh the epitome of both style and speed. Time- and digital-compression notwithstanding, it is not so long since the internet was the exclusive domain of academics and military scientists (and, of course, Al Gore).
None of the changes wrought by such innovations has fundamentally altered the nature of the arbitrators role, which has always required an appreciation of the legal, commercial, practical and yes technological realities of the world within which a particular dispute has arisen. The issues that the arbitrator is called upon to resolve, and the business contexts that give rise to such issues and in which any solution is to be implemented, may be different than they were just yesterday. Yet, I submit that such changes go more to the question of the "how" rather than the more basic "what" or "why" of the arbitrators task. Nor am I convinced that the need for fair, efficient, speedy and appropriate dispute resolution is any more pressing today than it was when Venice or Genoa were centres of global trade and commerce.
In 1622, Gerard Malynes published his treatise: "Consuedo, vel, Lex Mercatoria: or, The Law Merchant: Divided into three parts, according to the Essential Parts of Traffick Necessary for All Statesmen, Judges, Magistrates, Temporal and Civil Lawyers, Mint-Men, Merchants, Mariners and Others Negotiating in all Places of the World". Malynes shall we say ... comprehensive text contains one of the first legal commentaries on international commercial arbitration in England, and remains, in many respects (spelling and pronunciation aside), as relevant today as then. Malynes wrote:
"The second Mean or rather ordinarie course to end the questions and controversies a-rising between Merchants [the first being negotiation], is by way of Arbitrement, when both parties do make choice of honest men to end their causes, which is voluntary and in their own power, and therefore called Arbitrium, or Free will, whence the name Arbitrator is derived: and these men (by some called good men) give their judgements by Awards, according to
equity and good conscience, observing the Custome of Merchants, and ought to be void of all partiality more or less to the one and to the other; having only
care that right may take place according to the truth, and that the difference be ended with brevity and expedition."
Malynes presumably never contemplated the possibility of on-line arbitration. Doubtless, he could not have imagined such a thing as electronic commerce. What he could, however, and did, comprehend, was the singular importance in a mercantile world of a system of justice derived from the will of the parties and reposing on the diligence, good faith, impartiality, legal skill and commercial sense of private arbitrators selected by them to resolve their disputes.
From that perspective, it might be said that nothing in the intervening three and three-quarter centuries has changed. Effective arbitration is required by e-commerce, today, much as it was required by the spice trade long ago or, in a previous millennium, by trade and commerce between Greek city-states.
The oath taken by the "Amihictiones" of Delphi citizens chosen to act as arbitrators in international commercial disputes more than 2000 years ago provides a vivid illustration of the remarkable strength, endurance and flexibility of the arbitral process:
"Every question in the judgment relating to the moneys and boundaries of Apollo I will decide as is true to the best of my belief, nor will I in any wise give false judgements for the sake of favour or friendship or enmity; and the sentence passed in accordance with the judgment I will enforce to the best of my power with all possible speed, and I will make just restoration to the god". (Footnote 7)
The stuff of international commerce the goods traded and the means of exchange has changed utterly since that time. However, the stuff of international commercial arbitration economy, fairness and efficiency of process; impartiality and skill of the arbitrator remains surprisingly durable, even in todays increasingly virtual world.
Arbitration, a millennia-old dispute resolution mechanism, has always demanded innovation. It has always required arbitrators to be both aware of and responsive to the needs of its users, as these have changed over time. Today, the development and ubiquity of electronic commerce represents a new challenge. Yet, e-commerce also opens the door to new opportunities for practitioners of international commercial arbitration, to advocate and market this uniquely flexible and well-established method of dispute resolution to a new generation of e-business people.
This Conference provides an important forum within which to discuss, debate and learn from the views and ideas of all those present, regarding the evolving role and requirements of arbitration as the principal means, and of arbitrators as the preeminent providers, of dispute resolution in the commercial world of the new millennium.
Footnotes:
- President, London Court of International Arbitration; Chairman and Senior Partner, Ogilvy Renault, Montreal, Canada. Mr. Fortier would like to thank his colleague, Stephen L. Drymer, for his invaluable assistance in the preparation of this text.
- At page 9
- Zygmunt Bauman:" Globalization: The Human Consequences", 1998, Columbia University Press, p.12
- M. Scott Donahey: "The First ICANN Decision and Some Thoughts on the Future", http://www.disputes.net/cyberweek2000/donahey.htm. The decision in question is available at http://arbiter.wipo.int/domains/decisions/pdf/d99-0001.pdf
- Ethan Katsh, Janet Rifkin and Alan Gaitenby, "E-commerce, E-disputes, and E-Dispute Resolution: In the Shadow of 'eBay Law'",1999, http://www.disputes.net/cyberweek2000/ohiostate/katsh.htm
- The Economist: E-commerce survey: Define and Sell, February 26th 2000.
- Marcus Niebuhr Tod, M.A.:"International Arbitration Amongst the Greeks"1913, Oxford University Press, p.116