Arbitration is still expensive.
The direct cost of arbitration mainly includes: (1) the arbitrator’s fee; (2) expenses for arbitrator travel and hearing room rental; (3) the cost of site inspection or experts appointed to assist the arbitrator; (4) legal fee.
Among these fees, legal fee usually takes up most part of the whole cost. The parties have to appoint lawyers to deal with the dispute except very simple case, because the law is very complexity. Legal fee main depends on how much time the attorneys spend. The longer the procedure lasts, the more legal fee is charged. At the same time, the disputes are often concern with professional knowledge, arbitrators have to appoint experts to assessment. The expense of employing these professionals is very high. In addition, the parties and their lawyers and arbitrators usually live in different countries, they have to make international trip to deal with the disputes. The transport fare is also very high. Hence, slow processing of arbitration will waste time and leads to the higher expenditure.
At present, because of these disadvantages, arbitration has been facing significant competition over the last few years from new tools of alternative dispute resolution (ADR) such as negotiation, mediation, conciliation, and mini-trials. These ADR mechanisms have been consistently advanced as alternative meant either to complement arbitration or to displace it altogether. So, arbitration institutions must make use of the advantage of new digital technology to short the processing, decrease the inconvenience and low the expense.
With the quick development of the Internet, e-commerce plays a more and more important role in economic growth. The development of e-commerce also makes online arbitration possible and necessary. The benefits of online arbitration are obviously. The first, convenient. The Internet has created new opportunities for parties to communicate and to engage in transactions at great distance. At the same time, the potential for disputes arising out of such communications or transactions between parties that are physically remote from each other has been increased. On-line facilities can eliminate the barrier of distance. There is no need for the parties and their lawyers and the arbitrators to travel from one side of the Planet to the opposite side. The second, speed. Speed is equal to distance divided by time. The elimination of the barrier of distance by the Internet and the use of the Internet as the medium for resolving disputes will increase the speed with which the dispute-resolution process can be conducted. The third, affordable. Since the cost of post and travel is reduced, and the duration of the proceeding is decreased, the arbitration cost will be decreased accordingly, thus the total
cost will be reduced to an affordable level.
Is online arbitration feasible?
Firstly, most parties to the international commercial disputes have the requisite technical facilities to participate in the
on-line resolution of the disputes.