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Negotiation and conflict resolution relies heavily upon social and cultural norms and body language cues, which can be harder to interpret when parties aren’t physically in the same room.

Online negotiation and dispute resolution in the digital era

Author: Ersel Akpinar, Principal Lawyer

23 March 2022

Negotiation and conflict resolution relies heavily upon social and cultural norms and body language cues, which can be harder to interpret when parties aren’t physically in the same room.

Online negotiation and dispute resolution has become increasingly important since the pandemic hit.

While COVID-19 restrictions have made it essential to take these processes online, there are benefits to doing so beyond the pandemic. Online is quicker, cheaper and much more convenient than face-to-face meetings, particularly for companies working across the vast APAC region.

The principles largely remain the same online as face-to-face, no matter where other parties are located. For example, it’s necessary to engage in rapport building at the start, and to behave the same way you would at an in-person negotiation by paying attention, being conscious of cultural nuances and finding common ground.

The differences (and challenges) arise more from the digital arena itself. Negotiation and conflict resolution relies heavily upon social and cultural norms and body language cues, which can be harder to interpret when parties aren’t physically in the same room.

There can be added confidentiality and security issues. Some digital solutions are even removing the human touch from negotiations altogether.

So what are some of the online solutions?

These include:

  • Traditional dispute resolution – this is conducted using videoconferencing platforms such as Zoom, Microsoft Teams or similar. These solutions enable some picking up of visual and verbal cues, if not body language.
  • Email and instant messaging are also options. But as the Harvard Law School’s Program On Negotiation blog points out, these don’t offer visual and verbal cues at all.
  • Automated negotiation – where offers continue to be made by different parties until resolution is reached, with technological intervention stepping in when a pre-determined figure has been attained.
  • Assisted negotiation – where artificial intelligence (AI) is used, for example to distribute assets based on financial fairness while meeting the underlying interests of the parties. The AI is capable of asking each party about their interests and facilitating agreement.

A mechanism for negotiating across APAC countries

There is also a joint APEC Collaborative Framework for Online Dispute Resolution of Cross-Border Business to Business Disputes, which was endorsed in 2019.

The framework permits businesses to file cross-border complaints online against organisations based in other signatory economies. Negotiations can then occur on the platform. If resolution is not easily achievable, the matter can proceed to mediation or arbitration, with accompanying binding settlements or determinations.

As member economies of APEC, this framework includes Australia, New Zealand, Singapore, Malaysia, Hong Kong and the United States.

Key features of the framework include a focus on keeping negotiations and conflict resolution inexpensive for businesses, utilising sanctioned online dispute resolution providers, and highlighting confidentiality provisions. The framework also focuses on supporting the development of mutually recognised privacy laws and entry into bilateral agreements for the enforcement of arbitration agreements.

Many of these arrangements are run through the country’s court system, or through recognised private providers.

Unstructured online negotiation

Perhaps the most important aspect of following informal processes is to ensure that confidentiality is maintained, and that connections are secure.

For confidentiality to be breached in a face-to-face meeting, it requires a party to leave a room and tell somebody else about what occurred during discussions. In the online realm, confidentiality becomes more challenging. Additional people can attend a meeting without their presence being known. Unauthorised recordings become even easier, and information can be disseminated without the knowledge of all parties.

One example is a European defence minister who accidentally tweeted login details for a confidential top-level video conference. As Politico reports, a journalist saw the tweet, and joined the meeting. The story certainly highlights the potential security risks associated with the use of online platforms for sensitive meetings and negotiations, if due care isn’t taken by everyone involved.

Location certainly matters less in this era of digital communications, especially where the APEC framework provides a common platform. But there are key differences to consider before taking negotiating and dispute resolution online.

If you have any questions or require guidance on navigating online negotiation and dispute resolution, please get in touch with the Lawthentic team.

About Lawthentic | Commercial Lawyers

Based in Sydney, Lawthentic provides high-level, specialist, commercial and corporate legal advice to business Australia-wide and across APAC. We deliver progressive end-to-end commercial law services that address the full spectrum of legal issues a business may encounter, driving “Real Progress for Enterprise”. Our legal services cover all areas of Commercial law, Corporate law, Intellectual Property law, Data and Technology law, Regulatory Compliance, and Dispute Resolution. We work with medium to large corporate businesses looking for friendlier and more cost-efficient legal services without compromising on expertise. We provide in-house, face-to-face, or remote support from our offices in Sydney.

About the Author

Ersel Akpinar, Principal Lawyer

Ersel is a Principal Lawyer, Founder and the Director of Lawthentic. He is a commercial lawyer with over 20 years’ experience working with a wide range of businesses in Australia and across the Asia Pacific region. Having started his career at top-tier US and Australian law firms, he is an accomplished, specialist and progressive legal advisor who is uncompromisingly dedicated to his clients. As a business enabler, a critical thinker and an interpreter of the law, Ersel believes in helping business to do business. Read more about Ersel >

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