1. An Emerging Model for
Global eCommerce ODR
June 2nd 2010
Colin Rule
Director of Online Dispute Resolution, PayPal

2. eCommerce Continues to Expand
e-Commerce has exploded over the last decade
U.S. B2B e-commerce generated $3.1 trillion in sales
revenue in 2008, accounting for 27% of B2B transactions
U.S. B2C e-commerce generated $225.2 billion in sales in
2008, up 5% from 2007
Consumers are becoming a major part of international
commercial transactions for first time
Cross border e-commerce trade is flat-lining
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3. The Challenge: Creating Justice for eCommerce
Traditionally business and consumer issues have found
redress in courts
However, eCommerce issues are difficult for courts to
handle because the issues cross multiple jurisdictions
Traditional judicial mechanisms also struggle with
eCommerce cases because:
the transactions are low value
litigation is expensive
it is difficult to enforce foreign judgments
The solution is ODR: global, cross-jurisdiction, low cost
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4. A Decade of Progress
 1999: OECD publishes “Guidelines for Consumer Protection in the Context
of Electronic Commerce”
 2000: US FTC and Department of Commerce host “Alternative Dispute
Resolution for Consumer Transactions in the Borderless Online
Marketplace” conference
 2002: The American Bar Association releases recommended standards for
eCommerce Dispute Resolution
 2003: GBDe / Consumers International agreement
 2004: Global Trustmark Alliance Organizing Committee launched at GBDe
Summit in Malaysia
 2007: OECD Recommendations call for states to establish mechanisms for
arbitration of consumer disputes
 2009: European Committee for Standardization releases recommended best
practices for ODR
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5. International Consensus
Rome I Regulation – EU Parliament Recital on special
conflict of law rule for consumer contracts calls for
ODR
European Parliament has cited the need to promote
ADR in the field of electronic commerce
Several nations (e.g. US, Mexico, Chile) have already
launched and evolved alternate dispute resolution
(ADR) mechanisms for business to consumer disputes
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6. New Initiative: The Global eCommerce ODR Proposal
The ODR Initiative is intended to promote consumer
confidence in e-Commerce by providing quick resolution
and enforcement of disputes across borders, languages,
and different legal jurisdictions.
Modeled on the ICANN system
Model law/cooperative framework and rules developed
over 6 months by an extended working group of public,
private, academic, and NGO representatives
Advanced as a formal proposal of the US Government to
the Organization of American States in January 2010
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7. Overall System Design
Central Clearinghouse
Sellers Seller
each opt-in
to the ODR
system
voluntarily Providers
Seller OAS
ODR providers apply
Case and are approved
Seller DB individually
Key Components:
A Central
Clearinghouse, who
maintains the case
database; National
National Administrators; and
National
Administrator ODR providers Administrator
approved by the
National
Administrators

8. CONFIDENTIAL AND PROPRIETARY 8

9. 43rd Session of the United Nations
Commission on International Trade Law
21 June - 9 July 2010, New York
• Note by Secretariat: Provisional  Note by Secretariat: Possible
agenda, annotations thereto and future work on online dispute
resolution in cross-border electronic
scheduling of meetings of the forty- commerce transactions (A/CN.9/706)
third session (A/CN.9/683)
“The Commission will also have “The goal of any work undertaken
before it a note by the Secretariat by UNCITRAL in this field should
on the issue of online dispute be to design generic rules which,
resolution and, in particular, will consistent with the approach
inform on the outcome of the adopted in UNCITRAL
colloquium “A fresh look at online instruments (such as the Model
dispute resolution (ODR) and Law on Electronic Commerce),
global e-commerce”, organized in could apply in both business-to-
Vienna on 29-30 March 2010 jointly business and business-to-consumer
with the Institute of International environments”
Commercial Law (A/CN.9/706).”

10. Conclusion
E-commerce cross-border disputes:
will form a significant proportion of complaints in
coming years;
require tailored mechanisms that do not impose cost,
delay and burdens that are disproportionate to the
economic value at stake.
The time is now to build a global ODR system to
address these challenges, and extend justice to
issues that are not served by existing systems
We’re closer than ever before
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11. Appendix
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12. Rome I Regulation – EU Parliament Recital
 “With reference to consumer contracts, recourse to the courts must be
regarded as the last resort.”
 “Legal proceedings, especially where foreign law has to be applied, are
expensive and slow. . . .”
 “The protection afforded to consumers by conflict-of-laws provisions
is largely illusory in view of the small value of most consumer claims
and the cost and time consumed by bringing court proceedings.”
 “As regards electronic commerce, the conflicts rule should be backed
up by easier and more widespread availability of appropriate online
alternative dispute resolution (ADR) systems. . . ”
 Available at
http://www.europarl.europa.eu/meetdocs/2004_2009/documents/dv/juri_oj(2007)1119_romei_am_/juri_oj(2007)1119_romei_a
m_en.pdf
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13. Rome I Regulation -- Review Clause
Article 27 of Rome I Regulations requires that by 2013
the EC provide special report to the European
Parliament on application of the special Rome I rule for
consumer contracts.
European Parliament cites need to promote inter alia
“ADR in the field of electronic commerce and . . . to
review to what extent on-line ADR schemes might be
used . . . to increase consumer confidence in electronic
commerce and obviate the need for court proceedings”
Special report may be accompanied by proposals to
amend the special Rome I rule for consumer contracts.
 EU Parliament Final Compromise Amendment 104 Article 23(b) (new), available at
http://www.europarl.europa.eu/meetdocs/2004_2009/documents/dv/juri_oj(2007)1119_romei_am_/juri_oj
(2007)1119_romei_am_en.pdf
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14. State ODR Models
 In some OAS member states, state-run alternate dispute resolution
(ADR) mechanisms for business to consumer disputes are very well
developed, offering dispute resolution services for a wide range of
consumer disputes.
 In Mexico, Concilianet, has been established to provide a
government run online dispute resolution platform. The Federal
Consumer Protection Law promotes and protects the rights of
consumers without distinction based on nationality or other
considerations.
Available at: http://concilianet.profeco.gob.mx/concilianet/faces/inicio.jsp.
 In Chile, a similar online platform has been established.
http://www.sernac.cl/tramites/index.php
 The US Federal Trade Commission launched www.econsumer.gov to
refer consumer cross-border cases to ODR providers
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