eBRAM commissioned a research report (viewable here: ODR Regulatory Models in the Digital Era Implications for ODR Rule Harmonisation across the Greater Bay Area.pdf, research conducted by Dr CHEN Hui, Eric) which examines the existing ODR practices in the US, the EU, the Chinese Mainland, Hong Kong and Macao. When comparing different ODR models worldwide, it is found that the scope of application of ODR, or even what constitutes ODR varies amongst different jurisdictions. In some jurisdictions, ODR is used for small/document-based claims with algorithmic determination as a mode of dispute resolution. In other jurisdictions, ODR is treated as an online version of ADR. Despite the diversity in the types of ODR, the application of ODR remains generally limited and needs more visibility. There may be certain hurdles to overcome before ODR becomes mainstream.

The objective of this research is to identify challenges facing Hong Kong in promoting ODR and how it could overcome the issues and explore potential approaches to facilitate ODR rule harmonisation in the Greater Bay Area (GBA).

The exploration of ODR rule harmonisation in the GBA is motivated by recent regional legislative and rule-making efforts. Although Guangdong, Hong Kong, and Macao have local legislation governing ADR, including e-commerce dispute resolution, the relevant legislation pertains to three different legal systems. The diversity of legal systems necessitates the identification of an ODR regulatory framework that could be applied across the Chinese Mainland (Socialist legal system or civil law system with Chinese characteristics), Hong Kong (common law system) and Macao (civil law system) for promoting and developing cross-border ODR services in the GBA. Under the “one country, two systems” principle, the legal departments of the GBA are working to converge ADR/ODR rules. These efforts promote the extensive application of ADR/ODR while upholding the rule of law in businesses in the GBA. For Hong Kong, this presents an opportunity to reinforce its role as an international dispute resolution centre and advance its integration into the GBA's development.

When comparing worldwide ODR models, it is found that ODR sometimes applies to a broader range of fields than ADR. However, certain restrictions are also found in various ODR models. The ODR providers in the GBA also encounter comparable challenges, such as prolonged processes, complicated procedures, and a lack of awareness.

As part of this research report, an online survey was conducted about residents of the GBA. The online survey indicated that only 14.7 % of respondents expressed satisfaction with their experience of resolving disputes online. More than half of the respondents complained about the inefficiency and slow pace of the process. That being said, most respondents (63.5%) maintain an open attitude towards ODR, and nearly half of the respondents (91 out of 200) agreed that ODR is a viable alternative to ADR and courts for dispute resolution. This indicates a potential for further development of ODR.

Extensive efforts will be needed to increase public awareness of ODR as more and more e-commerce platforms start to provide ODR services. The majority of respondents consider a degree of government intervention is necessary in ODR regulation. The “government regulation pattern” is the least favoured option in both domestic (25%) and cross-border (26%) contexts, compared to “self-regulation” and “co-regulation”. In the domestic context, most respondents choose the self-regulation pattern (39%), whereas almost half of the respondents favour the co-regulation pattern in cross-border cases. This finding suggests that while many respondents accept government intervention in ODR regulation, they prefer co-regulation over government regulation to ensure flexibility. Regarding facilitating ODR rule harmonisation in the GBA, 35% of respondents considered reaching collaborative agreements among the GBA cities more essential. 30% viewed “establishing a uniform or at least cohesive ODR rule framework” as more important, while another 20% favoured developing reliable and secure platforms.

In order to promote the application of ODR and harmonisation of relevant rules across the GBA, the report suggests the following measures:

• GBA ODR Collaboration Platform (“Platform”): The Hong Kong government should consider building a collaboration platform to promote ODR in GBA, facilitating information exchange and enabling disputants to access legal services offered by the chosen arbitration place within GBA. It is suggested to utilise the Platform as a channel to promote the benefit of using ODR to resolve disputes. Besides, it also provides a venue for people to resolve disputes online.
• In respect of the establishment of the Platform, the Hong Kong government can take the lead and initiate the idea through the “Joint Conference Mechanism”. At the same time, eBRAM can partner with GBA dispute resolution institutions/ centres by signing a bilateral cooperation agreement to commit to this good cause.
• (Update (July 2024): Further to this recommendation, institutions from the GBA and eBRAM jointly established the GBA Online Collaborative Platform on 11 July 2024, setting the foundation for enhanced collaboration and resource sharing between GBA dispute resolution institutions. The GBA Online Collaboration Platform can be viewed here: https://gbadrplatform.org.

• A uniform ODR Standard: the existing cooperation between GBA legal departments focuses on converging ADR rules, but further efforts are needed to harmonise ODR rules. A uniform ODR standard/ guideline should aim to encourage ADR/ODR entities to refine the ODR process to address the issues such as “prolonged processes”, “complicated procedures”, “insufficient opportunities and difficulties to produce evidence”, perceived “mediators’ lack of professionalism” and “biased results”. The uniform ODR standard should also bridge the rule gap of different jurisdictions.

• Efforts to enhance professionalism and awareness of ODR practice: Based on the survey results, some respondents shared their undesirable experiences with dispute resolution practitioners during the conflict-resolving process. In response to the issue, the ADR/ODR entities in the GBA should jointly promote a common ODR mechanism that aligns with international standards. It would provide more confidence to companies/ individuals in the GBA to use this cost-effective and efficient way to resolve disputes and thus promote the usage of ODR in response to the objectives of the 14^th Five-year Plan and the development of the GBA objectives.

In the long run, legal departments of GBA cities should leverage the “Joint Conference Mechanism” to formulate specific laws and regulations for a robust, efficient and sound ODR system for GBA, which could be replicated by other cities.

Update (July 2024): At the institutional level, since 2021, eBRAM signed MOUs and/or cooperation agreements with various GBA dispute resolution institutions. Amongst various objectives, one objective is to promote online dispute resolution and LawTech, as well as develop the GBA’s position as an international legal hub and dispute resolution centre. Continuous cooperation with other GBA ADR/ODR entities is recommended to enable impactful promotion of the utilisation of ODR in resolving cross-border disputes. To this end, the Hong Kong government should introduce relevant policies and conduct relevant dialogues with their counterparts in the GBA to support the collaboration of ADR/ODR entities based in the GBA.