Businesses and transactions are now being carried out online, and the world is gradually becoming digitalized. As a result, online transactions should be given legal backing. Online dispute resolution is thus the best way to deal with online disputes in this digitalized era.

When disputes evolve online, parties, most of the time, want to resolve them peacefully without going to court. Since the dispute arose online, it is best for parties to adopt the Online Dispute Resolution mechanism.

The concept of Online Dispute Resolution

Online Dispute Resolution is concerned majorly with disputes that arise from over the internet or the use of internet. It could either be a conflict over domain names or e-commerce transactions. It offers an effective, less costly dispute resolution process, quick and easily accessible where the online dispute arises.[i] ODR is not complex in nature, unlike litigation, which requires filing in courts and following the court rules.

Online dispute resolution (ODR) is the settlement of disputes through an online means between disputing parties.[ii] Online dispute resolution deals with issues arising from the cyberspace or internet. It also deals with disputes that arise outside of the internet, that is, offline, but mostly disputes that arise over the internet.

Online dispute resolution serves as an alternative to litigation and also alternative dispute resolution. Litigation requires the disputing parties to go to court, while Alternative Dispute Resolution is a means of settling cases out of court, but the disputing parties will have to meet physically to come to an agreement on how to resolve their issues for Online dispute resolution, parties do not have to meet physically. They settle their issues online.

Read also: What I ordered vs What I got; Are there any remedies available to an unsuspecting buyer in an e-commerce transaction?

The disputing parties may use different technology during online dispute resolution. It can be done through the internet with either email or videoconferencing or any other means of technology that suits the parties involved.[iii]

What are the benefits of Online Dispute Resolution?

  1. It is quick and effective.

Online Dispute Resolution is effective when the parties involved have their business on the internet. This is because they are familiar with the principles of online operations. It is easy to develop relationships and work actively towards settling disputes. There is a low cost involved in online dispute resolution. If online disputes are referred to court for settlement, it will be time-consuming because of the process involved in litigation. Thus, it is preferable to resolve disputes online.

If a dispute that arise online should be referred to court for settlement, the cost of settlement might be more than the cost involved in the online transaction.

  • It addresses jurisdictional issues.

In the traditional way of settling disputes by going to court, matters are assigned to courts based on the jurisdiction where the matter arose or where the subject matter is situated.  In this instance of online dispute, it will be difficult to assign the case to a particular jurisdiction.[iv] Thus, online dispute resolution is best for resolving issues arising from internet transactions. This settlement is fully internet based and not regulated by Rules of Court like the litigation.

  • It is flexible

The parties involved in the transaction can decide how, where, and the online means to use to settle their dispute. Parties do not have to be physically present to resolve their dispute. It is done over the internet at any time.[v]

Differences between Alternative Dispute Resolution and Online Dispute Resolution

  • Alternative Dispute Resolution is a substitute for litigation in a court of law. It comprises different types like mediation, negotiation,[vi], and conciliation while Online Dispute Resolution is a form of dispute resolution that uses technology to facilitate the resolution of disputes between parties.
  • Alternative Dispute Resolution can either be done physically or online, but Online Dispute Resolution, it is strictly done online with the use of the internet and communication apps like email, skype.[vii]
  • There are laws that regulate Alternative Dispute Resolution, but no distinct law is in place that regulates Online Dispute Resolution.

Read also: Online privacy rights.


In conclusion, it is safe to say that Online Dispute Resolution, if utilized properly, is effective in solving online-related transactions. This is because it defies the normal process of following the rules in litigation. It is also cost-effective and flexible.

Online dispute resolution provides more satisfaction to the disputed parties as it offers solutions with a lot of conveniences. This process is faster, cost-effective, and more approachable when compared to the traditional legal system.








Written bOlalekan Elizabeth for The Trusted Advisors

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