Introduction:

Trademarks are essential tools for businesses in today's global marketplace because they allow them to differentiate their goods and services while preserving their brand identity. Nonetheless, trademark-related issues are becoming more frequent, which calls for quick and practical dispute resolution procedures. Using digital platforms to enable distant arbitration sessions, online arbitration has become a practical solution for resolving these issues. This approach reduces the expenses and time restrictions related to legal disputes by providing a more efficient substitute for traditional litigation. Under the supervision of arbitrators skilled in trademark law, parties participate in virtual hearings where they present evidence, argue positions, and cross-examine witnesses. The online model improves accessibility by removing logistical obstacles from participation for parties who are geographically scattered. Online arbitration also fosters expertise by allowing parties to choose arbitrators who have specific experience with trademark disputes.Online arbitration offers a strong alternative for quickly and equitably resolving trademark issues in the digital era, even while it is not appropriate for all disputes especially those that call for substantial discovery or intricate legal analysis.

Evolution of Trademark Dispute:

Regarding trademark issues, the development of dispute resolution procedures is a reflection of how the world of commerce has changed and adapted to the digital era. Historically, the main method of resolving trademark disputes was through litigation in national courts, which is sometimes associated with exorbitant expenses, drawn-out hearings, and complicated jurisdictional issues. But as e-commerce has grown and marketplaces have become more globalized, the terrain of trademark conflicts has changed.

A notable change in the handling of trademark disputes is the introduction of online arbitration. The need for more effective and accessible dispute resolution techniques in the digital age has fuelled this progress. Online arbitration uses digital tools to streamline the process of making decisions, submitting evidence, and holding distant hearings. It is an alternative to traditional litigation.This method encourages expediency and cost-effectiveness while also lowering the administrative obstacles connected to traditional litigation.

Moreover, the development of trademark dispute resolution is indicative of an increasing focus on specialization and expertise. Now that parties have the option to choose arbitrators with specialized training and experience in trademark law, rulings will be rendered by people who understand the nuances of intellectual property rights.

How online arbitration works:

Online trademark arbitration follows a set procedure designed to settle disputes quickly and equitably in the digital sphere. Parties first choose arbitrators who are knowledgeable with trademark law and arbitration procedures. Following the selection of arbitrators, each side presents evidence and arguments to start the process. Trademark registrations, usage records, communications, and pertinent contracts are a few examples of this proof. In order to protect sensitive data, the arbitration platform frequently uses encrypted communication channels to enable the safe sharing of this information.

Online hearings are arranged when the evidence is submitted; these are usually held through video conferencing or specialized arbitration platforms. Parties offer their legal positions and may summon witnesses to testify at these proceedings. The arbitrators supervise the process, making sure that fairness standards and procedural laws are followed. In order to make a conclusion based on applicable trademark law and commercial agreements, they must first evaluate the facts and the legal arguments.

The concepts of impartiality, neutrality, and confidentiality serve as the guiding principles for the decision-making process in online arbitration. Arbitrators have an obligation to respect these values, which promote faith in the fairness of the proceedings. The arbitration platform is used to electronically notify the parties of the decision once it has been made. This ruling usually provides a conclusive end to the trademark issue and is enforceable.

Importance of Online arbitration:

In the context of contemporary dispute resolution, online arbitration is quite important, especially when it comes to trademark issues. Its appearance answers a number of important demands in the current digital environment. First off, in situations where parties may be dispersed over multiple jurisdictions, online arbitration provides a workable answer to the problems presented by international trade and e-commerce. Online arbitration removes the practical obstacles associated with traditional litigation, such as travel expenses, time zone differences, and jurisdictional issues, by enabling hearings and proceedings to be held remotely through digital platforms.

Second, by allowing parties from various regions and backgrounds to engage in the dispute resolution process, online arbitration fosters diversity and accessibility. This accessibility creates a more level playing field for companies of all sizes, enabling them to successfully defend their trademark rights without being constrained by location.

Furthermore, online arbitration's effectiveness is crucial for quickly settling trademark disputes, which frequently call for quick action to avoid possible harm to a brand's reputation and market share. Online arbitration guarantees a speedy result while upholding the process's integrity and impartiality by optimizing processes and utilizing digital technologies.

Accessibility and Inclusivity in Trademark Disputes:

In trademark disputes, accessibility and inclusivity are important factors to take into account. They guarantee that all parties, irrespective of their circumstances or background, have equal access to the dispute resolution process. Multinational organizations, small enterprises, and individual entrepreneurs may engage in trademark disputes. In order to ensure justice and honesty in the resolution process, it is imperative to attend to the concerns of all parties involved.

Geographic accessibility is one facet of accessibility in trademark disputes. Due to jurisdictional restrictions, the expense of travel and legal counsel, and other factors, litigation in national courts has historically presented difficulties for parties who are located in different nations or regions. By enabling parties to participate in hearings and proceedings remotely, online arbitration platforms lessen these difficulties by doing away with the requirement for physical presence and cutting down on travel costs. This guarantees that parties from a variety of geographic areas can use dispute resolution procedures without having to bear excessive costs.

Online arbitration further improves accessibility by providing flexible scheduling choices and taking into account the different demands and time zones of the parties. Due to this flexibility, obstacles relating to work schedules, childcare commitments, or other obligations can be overcome, enabling parties to participate in processes at times that are convenient for them.

Ensuring accessibility of the dispute resolution process to parties with varying socio-economic origins, cultural backgrounds, and legal experience is a crucial aspect of inclusivity in trademark disputes. Parties that might not have sufficient resources or in-depth understanding of trademark law might benefit from the assistance and resources offered by online arbitration platforms. To make sure that everyone can engage in the process successfully, this can entail providing advice on submitting evidence, hiring legal counsel, or providing language interpretation services.

Protection of Sensitive information:

In trademark disputes, where parties frequently have to divulge intellectual data, trade secrets, and private business information, protecting sensitive information is crucial. To protect the integrity of the dispute resolution process and avoid any misuse or unauthorized disclosure, it is imperative that this information be kept secure.

Encrypting data and using secure communication channels are two important ways to protect sensitive information in trademark disputes. Strong encryption measures are used by online arbitration systems to guarantee that any information sent between parties and arbitrators is kept private and shielded from illegal access or interception.

To set explicit rules for handling sensitive information throughout the arbitration process, parties may also sign protection orders or confidentiality agreements. These agreements set forth the categories of data that are protected by confidentiality, who can access it, and how it should be handled, stored, and disposed of.

Furthermore, by upholding stringent confidentiality guidelines and professional conduct norms, arbitrators are essential in guaranteeing the security of sensitive data. They are not allowed to reveal or use any confidential information revealed during the arbitration processes for their own benefit or for any other unlawful use. They are also obligated by ethics to protect such information.

Sensitive information may occasionally be anonymized or redacted by the parties before being submitted as evidence in arbitration. In order to preserve secrecy, this entails deleting or hiding identifiable information or private data while retaining enough information for the arbitrator to take into account.

Cases Where matter is resolved by Arbitration in Trademark

Starbucks Corporation Vs. Mohan Raj 2009

This is a case of domain name dispute were complainant’s domain name www.starbucks.co.in was confused with respondent’s domain name that is www.starbucks.in. Here the arbitrators held that the respondent did it in a bad faith and the domain name was transferred to the complainant. (Starbucks Corporation v. Mohan raj, 2009).

Google Inc vs. Gulshan Khatri 6th October 2011

In this case, the complainant or the disputed party filed a formal complaint against the infringer for infringing their domain name as the respondent registered an identical domain name. On top of that, the respondent was also providing a very similar service that the complainant offered to its users, therefore, the involved party went for arbitration to resolve the matter and reconsider the original rights of the domain name. Hence, after the arbitration, the adjudicator ruled the case in favour of the complainant, and the same domain name was later scrapped officially.

Morgan Stanley vs. Bharat Jain 28th October 2010

In this case, the infringed domain name www.morganstanleybank.co.in was a registered domain name under the name of the infringer on 20 June 2010. The complaint registered against the infringer was based on the fact that in addition to the country code top-level domain which was added to the infringed domain name, the disputed domain name was very similar to the complainant’s official trademark, “MORGAN STANLEY”. The matter was solved by Arbitration.

Conclusion: Future of trademark dispute resolution

In conclusion, given the demands of a world that is becoming more digitally and globally networked, trademark dispute resolution is likely to continue changing in the future. Online arbitration, which provides quick, easy, and expert-driven dispute resolution in the digital era, has already completely changed the trademark dispute environment. As companies and people look for more affordable, efficient, and customized solutions to traditional litigation that address the intricacies of trademark law, it is anticipated that this trend will continue to grow.

In the future, technological developments like blockchain and artificial intelligence could further transform trademark dispute resolution by improving security, efficiency, and transparency. Artificial Intelligence (AI)-driven instruments may aid in case administration, legal investigation, and evidence evaluation, whilst blockchain technology might offer unchangeable documentation of trademark possession and application, diminishing disagreements and expediting their settlement.

Furthermore, the demand for specialist knowledge in trademark dispute resolution is probably going to increase due to the globalization of markets and the growing complexity of intellectual property rights. In order to effectively handle the particular difficulties presented by international trade and technological innovation, arbitrators must possess in-depth understanding of international trademark law, cross-border enforcement techniques, and developing digital platforms.

Ultimately, creativity, flexibility, and a dedication to justice and honesty will define the future of trademark dispute resolution. Achieving this requires stakeholders in trademark disputes to embrace technological innovations, support accessibility and inclusivity, maintain the highest standards of professionalism and confidentiality, and navigate the complexities of the contemporary marketplace with confidence and faith in the dispute resolution process. Trademark dispute resolution will be essential to protecting intellectual property rights, encouraging innovation, and creating fair competition for companies of all sizes and backgrounds as the digital economy develops.

1. As is the signature tune of the Act, 1996, the crucial aspect of 'place of arbitration' is left at the first instance in the hands of the parties. In the absence of any such agreement, the Arbitral Tribunal is obligated to determine the 'place of arbitration' after taking into consideration the over-riding factors of the convenience of the parties in the circumstances of the case and the convenience of conducting the proceedings. Section 20 of the Act, 1996 has adopted from Article 20 of the UNCITRAL Model Law1.

2. Author Francis Russell2 observes that the primary circumstances to be taken into consideration are “the place where most of the witnesses reside, the situation of the subject- matter of the dispute, and the balance of convenience and expense." In fact, a lot of provisions have been made to ease the process of arbitration under the A&C Act, but the lending companies are misusing them by getting the borrowers to sign the agreements to the benefit of the companies.

3. Section 20(1) of the Arbitration and Conciliation Act, 1996 provides that “the parties are free to agree on the place of arbitration.” The same Section 20(1) of the Act is being misused by the lending companies, and in case of a dispute among the parties, these companies do not fail to harass the borrower by determining the place of arbitration thousands of kilometers away from where the borrower resides. Under the Act, there is a provision to refer the case to the arbitrator in case of any dispute among the parties. At this juncture, the lending company decides the place of appointment of the arbitrator to be included in the terms of the loan agreement as per its own convenience.

4. It has been observed that the lending companies used to fix the place of arbitration at their own convenience on the locations on their head offices are situated viz. Mumbai, Chennai, Jaipur, Gurgaon (Delhi), etc. where it is not feasible for the borrowers to take part in arbitral proceedings.  Due to this, in case of a dispute, the borrower has to travel to other States far from his residence to present his case before the arbitrator. The place of the arbitration is chosen far away, and the debtor is neither able to appear before the arbitrator nor present his case. This leads to the ex-parte decision being passed by the arbitrator, which is equivalent to a decree of a Civil Court.

5. The award is equivalent to a decree of a Civil Court, then the place of suing also be governed in accordance with sections 9 to 25 of the CPC. The lending companies cleverly adopts the provisions for jurisdiction for filing arbitral dispute from A&C Act and for filing execution of award from CPC.  O XXI, R 3 to 9 of The Code of Civil Procedure, 1908 provides requirements to determine the jurisdiction of Courts for the execution of the decree. After passing the arbitral award in favour of the lending company, the borrower faces the execution proceedings u/sec. 36 of the A&C Act at Jurisdiction of District Courts. Even though the borrowers have the right to challenge the award u/sec. 34 of the A&C Act, there are exceptional chances where Principle District Court set-asides the arbitral Award.

6. To eliminate the procedural lacuna in the Act and provide equal opportunity to borrowers, Hon’ble Shri. HANUMAN BENIWAL, Member of Parliament proposed Bill No. 243 of 20223 as follows;

THE ARBITRATION AND CONCILIATION (AMENDMENT) BILL, 2022

By A BILL further to amend the Arbitration and Conciliation Act, 1996.

BE it enacted by Parliament in the Seventy-third Year of the Republic of India as follows:— 1.

(1) This Act may be called the Arbitration and Conciliation (Amendment) Act, 2022.

(2) It shall come into force on such date as the Central Government may, by notification in the Official Gazette, appoint.

2. In section 20 of the Arbitration and Conciliation Act, 1996, in sub-section (1), the following proviso shall be inserted, namely:—

“Provided that in all cases related to property loans or vehicle loans, the place of arbitration shall be in the district where the borrower usually resides.”

7. Independence and impartiality are the basic principles for every arbitration proceeding. Likewise, a fair opportunity to being heard is a fundamental right of parties to dispute. In view of the above, it is necessary to amend the Arbitration and Conciliation Act, 1996, with a view to providing that in the cases related to property loans or vehicle loans, the place of arbitration shall be in the district, where the borrower usually resides.

The Indian legal system faces a daunting challenge: a staggering backlog of over 5 crore cases clogging its courts. Enter mediation, a promising alternative gaining momentum as a faster, more efficient, and often more amicable way to resolve disputes. Let's delve into the world of mediation in India, exploring its core principles, legal framework, and key advantages.

At its heart, mediation is a voluntary process facilitated by a neutral third party – the mediator. Unlike adversarial court proceedings, the mediator guides open communication and understanding between the disputing parties, helping them find mutually agreeable solutions that address their underlying needs and interests. This collaborative approach fosters better relationships and future interactions, making it ideal for situations where preserving ties is crucial.

The Mediation Act, 2023, provides a strong foundation for this practice. It recognizes various forms of mediation, including pre-litigation and online options, while emphasizing confidentiality and empowering courts to refer suitable cases for mediation. Interestingly, agreements reached through mediation have the same legal force as a court judgment, ensuring their enforceability.

KEY PROVISIONS OF THE MEDIAITON ACT 2023

A voluntary and cooperative method of resolving disputes, mediation is becoming widely acknowledged as a very successful substitute for conventional litigation. The Indian government established the Mediation Act, 2023, in recognition of the need to promote mediation as the preferred technique for resolving disputes. On September 14, 2023, the president signed the Mediation Act, 2023, and on October 9, 2023, the Ministry of Law and Justice notified the public.

Pre-Litigation Mediation is recognized under Section 5 of the Mediation Act, and Section 5(1) stipulates that parties may choose to resolve their differences through pre-litigation mediation freely and with mutual consent. Additionally, it upholds the dispute's confidentiality as specified by Act Section 22.

The Mediation Act's Section 7 gives the court the authority to send parties for mediation at any point.

Section 18 of the Mediation Act stipulates that any mediation conducted in accordance with the Act must be finished within 120 days after the first day of the mediator's hearing. This 120-day period may be extended by a maximum of 60 days, for a total of 180 days. This guarantees the cases are resolved quickly in order to maintain the mediation's goal.

Section 30 of the Mediation Act acknowledges online mediation as well. It specifies that, with the parties' written consent, mediation may be carried out in any manner utilizing computer networks and electronic forms, as long as the confidentiality of the proceedings is maintained.

The Supreme Court rendered a historic decision about the required pre-institution of mediation under Section 12A of the Commercial Courts Act in the cases of M/s Patil Automation Private Limited and Ors. vs. Rakheja Engineers Private Limited.

According to Section 16 of the Mediation Act, the mediator's job is to encourage the parties to settle their differences voluntarily. As agreed upon, the mediator will communicate each party's viewpoints to the other and assist in identifying issues, fostering a deeper comprehension, defining priorities, and investigating possible areas of settlement.

For the parties participating in the mediation process, Section 27 states that the Mediated Settlement Agreement is final and binding. It states that the mediated settlement agreement can be enforced in accordance with the Code of Civil Procedure, which treats it similarly to a judgment or decree rendered by the court.

According to Section 28 of the Mediation Act, any party that challenges a mediated settlement agreement that has been reached between parties may do so before a court or tribunal with the relevant jurisdiction, regardless of any other laws that may be in place at the time.

Section 30 of the Mediation Act, 2023 guarantees that online mediation, including pre-litigation mediation, is still an option at any stage of the mediation process. Parties must only provide written consent, with the understanding that confidentiality and integrity of the process will be maintained.

Beyond legal provisions, mediation offers several compelling Advantages:

• THE MEDIATOR IS NEUTRAL AND BALANCED

The Parties are not judged by the Mediator. The issues at hand are not evaluated by the mediator. Facilitating talks to assist the Parties in resolving their disagreement and coming to a settlement agreement is the mediator’s job.

• Faster resolution: Unlike lengthy court battles, mediation often concludes within months, saving time and resources for both parties.

• Cost-effective: Mediation fees are considerably lower than litigation costs,making it a more affordable option for individuals and businesses.

• Empowered solutions: Parties, not the court, determine the outcome, fostering a sense of control and ownership over the resolution.

• Win-win outcomes: Collaborative dialogue often leads to solutions that address the unique needs of both parties, promoting long-term satisfaction.

• Reduced conflict: Open communication and a neutral facilitator help de-escalate tension and rebuild damaged relationships.

Conclusion:

Of course, mediation isn't a magic bullet. It may not be suitable for all disputes, particularly those involving complex legal issues or significant power imbalances. Careful consideration of the nature of the dispute and the willingness of parties to engage collaboratively is crucial before opting for mediation.Creating awareness and building trust in the process will encourage its wider adoption, not just for reducing the caseload but also for fostering a more amicable and collaborative approach to conflict resolution in India.

Looking towards the future, educating the public, legal professionals, and courts about the benefits of mediation is key.

In an era defined by technological advancement and digital transformation, traditional practices are evolving to meet the demands of the modern world. One such evolution is the emergence of Online Dispute Resolution (ODR), a concept that promises to revolutionize conflict resolution in today's digital landscape. 

ODR is the application of technology to facilitate the resolution of disputes between geographically dispersed parties. It encompasses various mechanisms, including negotiation, mediation, arbitration, and adjudication, all conducted through online platforms. This innovative method of dispute resolution offers numerous benefits, including increased accessibility, convenience, cost-effectiveness, and efficiency. 

The adoption of ODR has been steadily increasing in recent years. According to a research report, the global online dispute resolution market size is growing at a compound annual growth rate (CAGR) of more than 10%. This growth is driven by factors such as the rising demand for efficient dispute resolution mechanisms, the proliferation of e-commerce and online transactions, and the need to overcome geographical barriers. 

One of the most compelling aspects of ODR is its ability to transcend geographical boundaries. It allows individuals from different parts of the world to engage in dispute-resolution processes without the need for physical presence. This not only saves time and resources but also fosters cross-cultural dialogue and collaboration. 

Moreover, ODR platforms are designed to be user-friendly and intuitive, making them accessible to individuals with varying levels of technological proficiency. This democratization of dispute resolution empowers parties to actively participate in resolving their conflicts, thereby fostering a sense of ownership and satisfaction with the outcome. 

In India and worldwide, numerous platforms have emerged to facilitate ODR processes. These platforms offer a range of services, from basic negotiation and mediation tools to more advanced arbitration and adjudication mechanisms. For example, Sehmati, the Delhi Dispute Resolution Society's online mediation platform, and Webnyay have gained popularity for their efficient and user-friendly interfaces. 

Furthermore, international platforms like Modron, Crek, and Modria provide comprehensive ODR solutions for businesses and consumers alike. These platforms offer a wide range of features, including secure document exchange, real-time communication channels, and customizable dispute resolution processes. 

The COVID-19 pandemic has accelerated the adoption of ODR, as social distancing measures and restrictions on in-person gatherings have made traditional dispute-resolution methods less feasible. This has led to a surge in the development and utilization of ODR platforms, highlighting the growing significance of this digital solution in addressing contemporary challenges. 

The Securities and Exchange Board of India (SEBI) has also taken significant steps towards integrating ODR into the Indian securities market. Through its Circular on Online Dispute Resolution of Disputes in the Indian Securities Market, SEBI has made ODR the default mechanism for resolving disputes, aiming to expand accessibility and accountability within the financial sector. 

India's proactive approach towards addressing cross-border B2C e-commerce disputes has been recognized by the United Nations, which has accepted India's proposal to develop a framework for global online dispute resolution. 

Additionally, the Department of Consumer Affairs is in the process of implementing and managing an Online Dispute Resolution Platform, demonstrating the government's commitment to modernizing dispute resolution processes and enhancing consumer protection through digital solutions. 

It's essential to differentiate between resolving a dispute through Alternative Dispute Resolution (ADR) using video conferencing for sessions and the comprehensive framework of ODR. While ADR sessions via video conferencing provide a virtual alternative to traditional face-to-face meetings, they often still involve offline elements such as document exchange and in-person hearings. In contrast, ODR platforms offer end-to-end online solutions, from issuing invitation letters to signing settlement agreements or awards. This fully digitalized approach eliminates the need for offline interactions entirely, providing a more streamlined process. 

However, it is essential to acknowledge that ODR is not without its challenges and limitations. Privacy and data security concerns are paramount in an online environment, requiring robust measures to safeguard sensitive information and ensure confidentiality. Additionally, the effectiveness of ODR relies heavily on the willingness of parties to engage in good faith and adhere to agreed-upon processes and outcomes. 

Despite these challenges, the potential of ODR to transform the landscape of dispute resolution is undeniable. By leveraging technology to overcome geographical barriers, streamline processes, and reduce costs, ODR has the potential to make justice more accessible and efficient than ever before. As we navigate the complexities of the digital era, embracing innovation in dispute resolution is not just a choice but a necessity. It is time to embrace the future of conflict resolution and usher in a new era of justice for all. 

Introduction:

Historically, most international IP-related disputes were decided before national courts rather than arbitral tribunals. In part, that is because arbitration is a creature of contract and, in many IP-related disputes (such as disputes over the ownership of IP or the alleged infringement of IP rights), that contractual relationship is missing.

Times have changed. While it is still the case that some types of IP disputes are litigated predominantly in national courts, the number of IP-related cases going to arbitration continues to grow. Indeed, one of the noticeable trends in international arbitration in the past several years has been the growing use of arbitration to resolve IP-related disputes. The caseload of the WIPO Arbitration and Mediation Canter, while not a perfect proxy, illustrates this trend.

Perceived advantages of arbitration in international IP disputes

Most intellectual property is defined by national statutory regimes. While a national court is expected to adjudicate IP infringement claims under its own laws, it may not be comfortable – or have the power – to adjudicate similar claims under a foreign law.

Consolidation of parallel cross-border proceedings

A significant advantage that arbitration may offer over national court litigation is the res- olution in a single forum of complex cross-border disputes.18 If parties’ business relationship involves IP-related rights in two or more countries, resolving disputes in a single national court may not be possible. The ability to address such disputes in a single arbitral proceeding is highly attractive.19 The time and cost advantages of such consolidation are obvious: fewer lawyers and decision makers are involved, and witnesses need testify only once.

Such consolidation has increasingly become a best practice in the IP context. This is especially true with global IP licensing programmes and of related SEP/FRAND disputes, where pursuing ‘piecemeal’ litigation in diverse national courts would be complex, cumbersome, and expensive.

International enforcement of arbitral awards

A further substantial benefit of arbitration is the potential to simplify the enforcement of a final decision – an advantage inextricably linked to the New York Convention. As set forth in Articles V(1) and V(2) of the New York Convention, the grounds upon which an arbitral award may be denied recognition and enforcement are extremely limited.38 They largely mir- ror the grounds to set aside an award under the UNCITRAL Model Law on International Commercial Arbitration. The Model Law has been adopted in numerous common law- and civil law-inspired jurisdictions, making it the law at the seat of arbitration (lex arbitri) in numerous arbitrations. The Model Law’s widespread acceptance has surely contributed to a convergence of arbitration law and doctrine across the spectrum of common and civil law cultures, even while those cultures continue to remain distinct and in some respects.

The relative ease of recognition and enforcement of arbitral awards is juxtaposed against the comparative difficulties in seeking to enforce foreign court judgments internationally.

Confidentiality

In international IP disputes, confidentiality concerns arise in (1) keeping the existence or outcome, or both, of the proceeding secret and (2) guarding the confidentiality of commercially sensitive information (such as trade secrets and business know-how) that may need to be submitted to the court or arbitrators in the course of the proceeding. As to the first concern, the secrecy of the outcome of a given dispute is often consid- ered a primary advantage of arbitration as compared to litigation.

Cost allocation

With respect to allocation of costs between parties in arbitration, there are generally two principal approaches: the rule that ‘costs follow the event’; and the ‘American Rule’ whereby each party bears its own costs regardless of the outcome.45

While litigation in national courts ordinarily means the parties are subject to that juris- diction’s rules as to cost allocation, an arbitration clause permits the parties to decide on their preferred approach to cost allocation.

SUMMARY

The following are key takeaways relating to the future of IP arbitration:

The question of whether a dispute is arbitrable at all is becoming less relevant. Arbitral tribunals increasingly address this issue by ensuring that the award has inter partes effect only. Additionally, trends show that state authorities increasingly recognise and enforce arbitral awards relating to IP disputes (including validity issues, in particular).

Arbitration may face increasing competition from national courts to handle IP disputes. For fear of losing large international proceedings to arbitration tribunals (including IP disputes), the number of ordinary commercial courts offering a specialised international chamber and the application of English as procedural language is likely to increase.

Development in the area of blockchain and smart contracts is promising. Arbitration proceedings as we know them today could change permanently if arbitration clauses in smart contracts trigger an automated process and the various steps in arbitration proceedings are completed via blockchain.

Before deliberating upon the role of Arbitration concerning the Settlement of International Trade Disputes, it would be pertinent to mention that the phase after Second World War is considered as the era of revival of natural law, in terms of the development of new laws. As observed by Hunter Nottage, Trade Law Manager, New Zealand Ministry of Foreign Affairs and Trade - “The global rules that underpin our multilateral economic system were a direct reaction to the Second World War and desire for it to never repeat.” 

Post the Second World War, IMF and International Bank for Reconstruction and Development popularly known as the World Bank have been institutionalized. An agreement i.e., the General Agreement on Tariffs and Trade, 1947 (GATT) has also been conceptualized and implemented by the contracting parties. The objective of GATT primarily involves the provision of a de-facto mechanism to facilitate trade and to resolve trade disputes. 

For more than five decades, this de-facto mechanism evolved and immensely contributed to global trade relations by facilitating international trade and by providing for a smoother dispute resolution process. 

The eighth round of negotiations from 1986–1994 viz. Uruguay Round concluded in the form of the Marrakesh Agreement. This paved way for the creation of the World Trade Organisation (WTO) and an institutional dispute settlement mechanism which is considered as the backbone of Multilateral Trading System. This has been enshrined in the form of Understanding on Rules and Procedures Governing the settlement of disputes (DSU), popularly known as the Dispute Settlement Understanding as Annex 2 of the Agreement establishing the WTO.

The DSU consists of 27 Articles and four appendices. It provides for an efficient, prompt, rule-based, and transparent system. The General Council in the guise of Dispute Settlement Body (DSB) takes care of the dispute settlement mechanism. Apart from the mandatory consultation stage, the dispute settlement process within the framework of the Understanding on Rules and Procedures Governing the Settlement of Disputes can be divided into two broader categories viz. Dispute Settlement with recourse to Panels and the Appellate Body, and Dispute Settlement without recourse to Panels and the Appellate Body. 

Before understanding Dispute Settlement without recourse to Panels and the Appellate Body, it is important to state the Aim of Dispute Settlement Mechanism given under Article 3.7 of the DSU. The DSU states “The aim of the dispute settlement mechanism is to secure a positive solution to a dispute. A solution mutually acceptable to the parties to a dispute and consistent with the covered agreements is clearly to be preferred.” This may be considered a reason as to why the WTO is deemed a member-driven and a consensus-driven organization in line with the WTO Agreement in its truest sense. 

Article 25 of the Understanding on Rules and Procedures Governing the settlement of disputesprovides Arbitration as an alternative option to parties for the adjudication process. Article 25.1 of DSU provides that, “expeditious arbitration within the WTO as an alternative means of dispute settlement can facilitate the solution of certain disputes that concern issues that are clearly defined by both parties.” However, it is required to be mentioned that within the framework of DSU, Article 25 must be read along with Article 21 which deals with Surveillance of Implementation of Recommendations and Rulings and Article 22 which deals with Compensation and the Suspension of Concessions. As a concluding remark, we may note that the number of disputes resolved through arbitration under DSU are very less. However, the plain reading of these articles provides sufficient context and insight to suggest that there is enough scope within the ambit of DSU to resolve disputes through Arbitration.

The Supreme Court of India is all set to entertain a curative petition appealing against its own recent 5-judge constitutional bench judgement, in the case of N.N. Global Mercantile v. Indo Unique Flame and Others, concerning the admissibility in evidence and validity of an unstamped arbitration agreement. Notably, under Section 35 of the Indian Stamp Act, 1899 (“Stamp Act”), an embargo has been placed on admitting in evidence for any purpose, any instrument chargeable with stamp duty unless such instrument is duly stamped.

The reference:

The question that fell for the consideration of the constitutional bench upon reference by a three-judge bench was:

“Whether the statutory bar contained in Section 35 of the Stamp Act, 1899 applicable to instruments chargeable to stamp duty under Section 3 read with the Schedule to the Act, would also render the arbitration agreement contained in such an instrument, which is not chargeable to payment of stamp duty, as being non-existent, unenforceable, or invalid, pending payment of stamp duty on the substantive contract/instrument?”

The question for reference clearly assumed that an arbitration agreement in itself was not chargeable to stamp duty. However, the Ld. Amicus Curiae appointed by the Court, Senior Advocate Gourab Banerjee, submitted that a standalone arbitration agreement was also exigible to stamp duty under the residuary clause for Article 5 in Schedule 1 of the Stamp Act. Therefore, the reference itself was amended as below:

“Whether the statutory bar contained in Section 35 of the Stamp Act applicable to instruments chargeable to stamp duty under Section 3 read with the Schedule to the Act, would also render the arbitration agreement contained in such an instrument, as being non-existent, pending payment of stamp duty on the substantive contract/instrument?”

By reframing the very reference, the judgment establishes that an arbitration agreement, whether in the form of a clause contained in an agreement or a separate agreement in itself, is exigible to stamp duty. The reference now seems to be limited to arbitration agreements incorporated as clauses in a substantive contract. The judgment holds that it is impossible to treat the arbitration clause as distinct from the underlying agreement for the purposes of stamp duty. Therefore, at the stage of reference under Section 11 of the Arbitration and Conciliation Act, 1996 (“Arbitration Act”), the entire substantive contract must be stamped.

Interplay with the Contract Act:

While concluding, the authors of the judgment have tried to impress that the findings are confined to court proceedings under Section 11 of the Arbitration Act, involving appointment of arbitrators. The reference under Section 9 of the Arbitration Act on a similar question of law, has been left pending. However, certain findings have been made in the judgment that, if approved during the curative petition proceedings, would directly impact all court proceedings in relation to arbitration, including the reference under Section of the Arbitration Act, for seeking interim reliefs. These findings rendered in relation to an arbitration agreement have been summarized below:

·      Payment of stamp duty and affixation of stamp is not a ‘mere technicality’ but substantive law. Lack of stamping is not merely a ‘curable defect’, since such an instrument cannot be taken notice of for any purpose. It is ‘bereft of life’ and not ‘enforceable in law’.

·      While the Stamp Act is not intended to arm litigants to raise ‘technical pleas’, there exists no justification to ignore the legislation which clearly indicates the importance of stamping for a document to be admitted in evidence.

·      An unstamped arbitration agreement ‘cannot exist in law’. It would be void, in line with the principle laid down in Section 2(j) of the Indian Contract Act, 1872 (“Contract Act”).

·      An unstamped arbitration agreement is both liable to be impounded under the Stamp Act and it cannot be used as evidence. Such an instrument would be void as being not enforceable, under Section 2(g) of the Contract Act.

Since, as per the judgment, an arbitration agreement would be bereft of life during its term till the time it is appropriately stamped, any interim relief may also not be available to parties. These findings may arm litigants with an excuse to evade contractual obligations and elongate court proceedings. legal costs and time would increase significantly, the very bane of court proceedings that was sought to evaded by establishing a robust ADR mechanism under the Arbitration Act. This may also delay securing of urgent relief where agreements have been executed without the payment of stamp duty, since impounding and stamping may involve lengthy proceedings before the Collector of Stamps.

The arbitrability of fraud in India has been a subject of significant legal consideration and evolution, as evidenced by various landmark judgments from the Indian Supreme Court. This analysis aims to summarize the key aspects of this complex issue and the legal principles established by the courts.

Indic Context:

- ADR practices in India have ancient roots, dating back to Vedic literature and the Mahabharata, highlighting the preference for peaceful dispute resolution.
- The existence of arbitral bodies in ancient India, like Panchayats, Srenis, and Kulas, underscores the historical importance of alternative dispute resolution.

Statutory Framework:

- The Arbitration Act, while not explicitly barring criminal matters, focuses on civil disputes and party autonomy.
- The Act excludes matters incapable of settlement by arbitration and against Indian law's fundamental policy.

Indian Supreme Court's on Arbitrability of Fraud:

1.  
   Abdul Kadir Shamsuddin Bubere v Madhav Prabhakar Oak (1962) - Serious allegations of fraud can lead to a court not ordering arbitration.

2. 
   N Radhakrishnan v Maestro Engineers (2010) - Matters of fraud requiring detailed investigation are non-arbitrable.

3. 
   Booz Allen and Hamilton Inc v SBI Home Finance Ltd (2011) - Disputes over rights in personam are arbitrable, while rights in rem disputes are not.

4. 
   Swiss Timing v Organising Committee, Commonwealth Games 2010 (2014) - Complex fraud allegations don't bar arbitration, even if criminal proceedings are pending.

5. 
   A Ayyasamy v A Paramasivam (2016) - Only serious fraud undermining the contract's fundamental validity is non-arbitrable.

6. 
   Rashid Raza v. Sadaf Akhtar (2019) - Fraud allegations affecting only private matters between parties are arbitrable.

7. 
   Avitel Post Studioz Ltd v HSBC PI Holdings (Mauritius) Ltd (2020) - Mere existence of civil and criminal proceedings doesn't render disputes non-arbitrable.

8. 
   Vidya Drolia v Durga Trading Corporation (2021) - A fourfold test to determine non-arbitrability was established, emphasizing public policy and in rem disputes.

9. 
   NN Global Mercantile Pvt Ltd v Indo Unique Flame Ltd. (2021) - The civil dimensions of fraud are arbitrable unless fraudulent origins nullify the arbitration clause.
    

Analysis:

Based on the decisions cited supra, the position qua arbitrability of fraud cases in India can be summarized as under:

I.The Indian Supreme Court has differentiated between serious and non-serious fraud allegations, allowing for arbitration in the latter.

II.Complex allegations with voluminous evidence indicate serious fraud and are typically not arbitrable.

III.The nature of fraud allegations, effect on third parties, public interest, and statutory exclusions are considered when determining arbitrability.

IV.The threshold for pushing allegations beyond non-seriousness is subject to judicial discretion.

While the above discussed parameters offer valuable guidance, they are not all-exhaustive in nature. They function as helpful indicators in assessing the arbitrability of fraud cases, but the final decision necessitates a thorough evaluation of each case's unique intricacies. This approach ensures that justice and the integrity of adjudication are consistently upheld, efficiently and equitably.

Conclusion:

In the realm of arbitrability of fraud in India, a delicate balance is struck between party autonomy and public policy. While Indian courts generally uphold arbitration agreements, they retain the authority to intervene in cases of blatant fraud that threatens the integrity of the arbitration process. This balancing act is pivotal in shaping India's arbitration landscape.

1. 
   The Supreme Court has pursued an autonomous objective in addressing disputes involving arbitrable fraud. It has categorized fraud allegations into two sub-parts: serious and non-serious. This categorization, though not rooted in criminal, civil, or contractual law, lacks support even in the Arbitration Act itself.
   

2. 
   Determining the threshold for pushing an allegation beyond the realm of non-seriousness is left to the discretion of the presiding judge. Factors such as the volume of evidence, complexity of allegations, and the nature of the dispute are considered.
   

3. 
   It's puzzling why an arbitrator, entrusted by parties and often recommended by the courts, is deemed less competent for civil adjudication when equipped with similar capabilities. This viewpoint is supported by the Law Commission of India's 246th Report.

In conclusion, the analysis of case law and discussions elucidate the intricate nuances of fraud arbitrability in India, leaving room for further exploration. To move forward, we must acknowledge the dynamic nature of the law while prioritizing the reduction of delays and preservation of party autonomy. This commitment will solidify India's reputation as an arbitration and ADR-friendly jurisdiction.