Brazil’s Best Counsel 2023 - Chapter Opening: Dispute Resolution: Northeast

Online Dispute Resolution: a growing global phenomenon

Between January and October 2022, the judicial branch of the brazilian government received 22.9 million new cases. "Consumidor.gov.br", an Online Dispute Resolution (ODR) platform maintained by the federal government and specialized in consumer law, has so far attended 6.3 million people. These data show the need, in the brazilian scenario, of technology development directed to conflict resolution.

The National Council of Justice (CNJ), an institution focused on improving the judicial branch in Brazil, realized this situation. In early December 2020, during the COVID-19 pandemic, it was determined that the Courts throughout the country would make available technology for conflict resolution. Under these circumstances, the SIREC, "Computerized System for Conflict Resolution through conciliation and mediation". was created.

In Europe, the European Commission provides an ODR platform focused on e-commerce. The latest available report, with data from December 2020, revealed that 3.3 million people visited and there was a 70% growth in the amount of complaints filed by consumers.

The ecosystem of ODR-related service provision is representative. The Codex Techindex, of the Stanford CodeX Center for Legal Informatics, has listed 560 companies that provide this type of service. This is equivalent to 27.55% of the total. The Brazilian industry association, "AB2L", indicates more than 20 companies that operate in the ODR sector.

In China, Beijing Internet Court is an example of the combination of technology and dispute resolution, particularly in copyright. More than 30,000 cases were solved on ODR platforms before reaching the Courts. This resulted, in the first half of 2022, in a 39.44% reduction in this type of conflict. The trend is that technology directed to conflict resolution enhances the Judiciary and improves the business environment as judicialization declines.

These circumstances justify calling ODR a global phenomenon. Artificial Intelligence (AI) is capable of driving this phenomenon. This means turning conflicts into patterns and patterns into insights capable of improving the ODR platform and thereby preventing conflicts.

The connection between technology and conflict resolution goes beyond support and replacement technologies, promoting disruption in the way people resolve conflict through technology. This is why we are talking nowadays about ODR assisted by AI (ODRAI) and Artificially Intelligent Dispute Resolution (AIDR).

ODRAI is when you increase the effectiveness of procedures and decision making through informative tools with AI. Technology is the fourth party that helps people find a solution to conflict. It is AI that supports people to understand the available options and the interests involved; to identify trade-offs and organize win-win solutions.

Examples of ODRAI include ODR platforms that deliver free draft documents and information on tenants' rights; supports consumers in paying debts; and assists conflict management in volume litigation for corporations.

AIDR is the replacement of the human being acting as a facilitator on the ODR platform with an algorithm. The technology is the third party. The AI is able to communicate with people, perceive their emotions, understand their intentions, and decide the best strategy to follow in each possible scenario. This is the possibility of autonomous conflict resolution in which algorithms negotiate with people in human ways, including when conducting the procedure.

This type of AI is reflected in avatars (digital models driven by humans in real time) and autonomous agents (digital models driven by algorithms virtual assistants who attempt to resolve conflicts between children in the home environment; and the participation of this technology in synchronous communication hearings, AI Judge.

Besides the technological advances and the potential benefits for the Judiciary and the business environment of corporations the debate also points to the precautions that must be taken regarding the application of AI in ODR platforms. Mainly, in the areas of data protection and information security. Which explains the recommendations to incorporate Privacy by Design best practices in ODR platforms.

ODR is no longer just about bringing people together, reducing costs, and saving time. The goals are broadened as the assertiveness of platforms grows through the use of technologies, such as AI. Talking about ODR and AI is about unleashing the strategic value of conflict management data. In other words, realizing win-win solutions, making qualified information available, finding patterns, increasing the scalability of platforms.

Therefore, ODR is a growing global phenomenon as several players recognize that the technology improves justice systems around the world and removes obstacles from corporate business environments.

Wilson Sales Belchior

Partner at RMS Advogados - Rocha, Marinho E Sales. Specialized in strategic and volume litigation, banking, financial and civil law. Specialist in Civil Procedure and Electricity. MBA in Business Management. Master in Law and Conflict Management, with a short course in conflict resolution from Columbia Law School. PhD candidate in Constitutional Law. Lecturer, professor in postgraduate courses, author of articles in books, newspapers and specialized  journals.

E-mail: wilson@rms.adv.br

Phone: +55 83 98844-7877