Mar 14,2022 | 5 min read

VIRTUAL ARBITRATION - THE NEW NORMAL

India is spreading its wings of technology across the country and worldwide. The scope and objective of digital infrastructure has gained colossal momentum among various sectors and citizens of urban and rural India. Likewise, the digital footprint has found its presence in the Indian judicial system in the past few years. The Supreme Court of India has encouraged techno-friendly platforms from e-court fees including e-filings, e-courts services portal to judicial proceedings empowering and enabling litigants, lawyers and justice delivery system. The e-committee of the Supreme Court of India was constituted to ease accessibility of information, enhance productivity, deliver cost-effective, transparent and efficient judicial services. While from the top court of the country to all the High courts, lower courts, tribunals and forums in the states and districts were adapting to digitisation, the outbreak of coronavirus all over the world not only compelled people to stay at home but brought everything to a standstill. The Government of India imposed nationwide lockdown and quarantine restrictions to curb this life-threatening virus. This unforeseeable chain of events affects the daily lives of people and the workforce in all walks of life. However, the effects of the pandemic did not deter the judicial commitment from hearing court cases via video conferencing and consequently, standard operating procedure (SOP) was introduced by the respective courts in India. Such procedural guidelines for virtual hearings have improved the judicial advancement and smooth functioning of courts. 

The consequences of surge in covid cases, safety measures and social distancing norms have deeply impacted physical arbitration proceedings before the arbitral tribunals. Otherwise, dispute resolution through arbitration proceedings has been encouraged by the Indian legislature, contesting parties and their respective counsels. The notable amendments in recent years, the arbitration law of India i.e. the Arbitration and Conciliation Act, 1996 stipulates a specific time limit for passing the award by the arbitrator, provides adoption for fast track procedure based on the principle of party autonomy. Such prevailing circumstances and statutory provisions will certainly facilitate the adaptation of virtual hearings of arbitral proceedings in domestic and international arbitration within the jurisdiction of Indian territory. Although, the Indian Arbitration Act is mute on taking up virtual hearings before the arbitral tribunal.

GLOBAL PERSPECTIVE:

Whereas, many international arbitration centres such as the International Chamber of Commerce (ICC), Singapore International Arbitration Centre (SIAC), London Court of International Arbitration (LCIA) and many more to the growing demand and on account of Covid-19 crises have set out the requisite guidelines for hearing arbitral proceedings by the use of video conferencing to expedite and effectively deliver dispute resolution mechanism. As per 2021 International Arbitration Survey, titled ‘Adapting arbitration to a changing world,’ it appears to look at how international arbitration has changed to meet adapting needs and situations, inclusive of virtual hearings. Besides, according to the arbitration community, 79 percent of respondents would prefer to ‘proceed at the scheduled time as a virtual hearing' if a hearing could no longer be performed in person and 61 percent of respondents said they choose virtual hearings over in-person hearings because it saves them time and money. All of this is done to guarantee that future procedures are not only as simple as feasible for the parties involved but also more transparent and accountable than ever before, owing to the use of technology.

INDIAN STANDPOINT:

Having said that, quite the opposite is witnessed in India. Several major arbitration institutions due to pandemic have postponed hearings, and no postponement request has been denied by the head of these institutions. Additionally, the ad hoc arbitrators appointed by courts have equally dispirited the legislative objective to dispose of pending arbitration in the time prescribed manner. Though the institutions have maintained that they wish to avoid delays and conduct proceedings to maintain the time-bound sanctity for arbitral adjudication, no countering measures appeared to have been taken against the same.  The Law Commission of India has encouraged the use of technology such as video conferencing and teleconferencing to improve the efficiency of online arbitral proceedings, but these recommendations have lacked traction in Indian arbitration due to resistance from arbitrators and counsels, majorly due to loose & incoherent approach to the technological exposure. 

The developments made by international arbitration institutions such as ICC, SIAC, LCIA should encourage the Indian arbitral institutions to reinforce the importance of arbitration as a legal tool and highlight the willingness of the legal industry to meet the desirable procedural trends alongside guaranteeing adjudication of the highest caliber. Arbitral Institutions in India should espouse opportunities to become more attractive to domestic and international markets for dispute resolution and promptly prepare themselves with the infrastructure to administer online arbitrations. The government, being the statutory body, should introduce and enact the necessary changes for adopting virtual hearings via video conferencing in the Arbitration Act, and issue model guidelines on virtual hearing for all the arbitral institutions in India from domestic to international arbitration, seated in Indian jurisdiction. 

KEY TAKEAWAY:

While the use of technology in overseas arbitration is becoming more frequent and habitual, particularly where it improves efficiency, transparency and accessibility. In international arbitration, technology has been widely employed, notably 'videoconferencing' and 'hearing room technologies'. The rise of virtual hearing rooms appears to be a result of how arbitration has evolved in reaction to the COVID-19 curse, as parties have been compelled to look for alternatives to in-person hearings.

Virtual hearings have provided a chance to assess users' perceptions of this procedural modification based on the development of technology and the rising urge for productive adjudication. The largest benefit of virtual hearings is viewed as the 'potential for increased availability of hearing dates,' followed by 'more efficiency through electronic platforms', 'better procedural and logistical flexibility and most importantly 'reduction of travel cost both in domestic and international disputes. On the contrary, prevalent downside comprises of 'difficulty of accommodating multiple or disparate time zones,' the impression that it is 'harder for counsels and clients to confer during hearing sessions,' and concerns that it might be more difficult to control witnesses and assess their credibility,' are among the most concerning aspects of remote hearings. The fallibility of technology is also noticed as well as the problem of screen weariness.' Nonetheless, the science of technology has been transforming to shape the future of digital impressions in the field of law and justice.

Need of the hour for Indian arbitral tribunals, either institutional arbitrations or ad hoc arbitrators, parties to disputes in domestic or international arbitrations, are required to embrace a virtual mode of hearings and get attuned to the objectives of the provisions of the Arbitration and Conciliation Act, 1996 towards party autonomy, fast track procedure and timely adjudication of arbitral disputes towards a collective approach for a NEW NORMAL.


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ABOUT THE AUTHOR


Raghu Vasishth

Presently, I am practicing diversified litigation. Engaged in all kinds of civil suits, commercial matters, arbitration proceedings, criminal cases including FIR cases and bail applications, corporate litigation, divorce cases, consumer disputes, writ petitions. Well versed with court crafts in Delhi District courts, Delhi High Court. Mentoring startups for upcoming ventures towards, legal compliances, legal opinions, vetting contracts as NDA, Service Agreements, License Agreements, etc.

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