The Legal Framework


Law has developed and now ADR has become the mainstream of justice delivery system in the world.

International Legal Framework

UNCITRAL Model Law on International Commercial Arbitration and Conciliation Rules.

Apart from various sources of international arbitration law, such as the European Convention on International Commercial Arbitration 1961[14] and Inter-American Convention on International Commercial 1975[15] supplemented by Inter-American Convention on Extraterritorial Validity of Foreign Judgments and Arbitral Awards 1979[16], EU Directive on electronic commerce[17], institutional rules and private contractual agreements, at international level, there are two main sources.

New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, 1958

At domestic levels in ancient, when there were no courts of law in India disputes were resolved by elder member of family, Sarpanch of Village or by Kulas, Srenis, Phugas or Parishadas. During British Empire, various laws were enacted to promote arbitration such as Madras Presidency Regulation Act, Bombay Presidency Regulation Act, and The Charter Act 1933. But the historical step was taken with enactment of Indian Arbitration Act 1940, which was solely based upon English Arbitration Act. It dealt with mainly domestic arbitration.

The Acts in India

Information Technology Act, 2000

One of the most important initiatives undertaken by the central government is the Information Technology Act, 2000, which is to regulate cyberspace and define offences and penalties related to IT such as tampering with computer source documents, breach of confidentiality and privacy, publication of false digital signatures and so on.

The concepts of writing and signature have been recently significantly modernized to provide greater certainty to online contracts and thereby facilitate e-commerce.[24] The most important step to this end was taken on international level by adopting the UNCITRAL Model Law on Electronic Commerce[25] in 1996. Then, UNCITRAL Model Law on Electronic Signatures[26] 2001 was adopted. Those legislative changes resulted in “a global reform of writing requirement”[27] The Information and Technology Act, 2000 being based on UNCITRAL Model Law of e-commerce was enacted in India to facilitate e-commerce and gives legal recognition to e-transactions. Section 4, 5, 10-A, 11-15 of the Act reflects the legal recognition to electronic records and signature.[28]


 National Cyber Security Policy (NCSP), 2013

In light of the growth of IT sector in the country, ambitious plans for rapid social transformation and inclusive growth and India’s prominent role in the IT global market, providing right kind of focus for secure computing environment and adequate trust and confidence in electronic transactions becomes one of the compelling priorities for the country. NCSP enables creation of suitable cyber security eco system in the country, in tune with globally networked environment and at the same time assures its citizens as well the global community about the seriousness of its intentions and ability to act suitably.

The Constitution of India:

After the independence, Constitution of India was adopted, wherein, Article 21 declares that no person shall be deprived of his life or his personal liberty except according to procedure established by law. And the procedure must be “reasonable, fair and just.”[18] Supreme Court of India in landmark case[19] held that right to speedy trial is part and parcel of right to life or personal liberty.

The Code of Civil Procedure, 1908:

By Civil Procedure Code Amendment Act 1999, Section 89 (Settlement of Dispute outside Court) and Rules 1A to 1C, Order10 (Direction of Court to opt for any one mode of ADR after first hearing of suit) were inserted which has made it incumbent upon courts where there exists elements of settlement to call upon the parties at their option to agree for one or other ADR methods.[20]

Arbitration and Conciliation Act, 1996

The Act has been enacted on basis of UNCITRAL Model Law on International Commercial Arbitration, 1985 and Conciliation Rules, 1980 with an important feature to harmonize the concept of Arbitration and Conciliation of different legal systems of the world and to have its universal application.[21] The main object of act is to encourage settlement of dispute amicably via Arbitration, Conciliation at domestic and international level. It permits Mediation, Conciliation or other procedures during arbitral proceedings to encourage settlement of disputes.[22] Act also gives settlement agreement reached by parties as a result of proceedings the status of court judgment under section 73 of this Act.[23] Recently, Arbitration and Conciliation (Amendment) Act, 2015, gave legal recognition to Arbitration Agreement entered into by communication through electronic means, which is a positive initiative towards the promotion of ODR in effective manner.

Indian Evidence Act, 1872

What if the agreements entered into through e-communication are not admissible as evidence in courts of law? For this purpose Section 65-A and 65-B were inserted which has made electronic evidence as secondary copy to be admissible in courts of law subject to the satisfaction of requirements mentioned in section 65-B.

About Arbitration

United Nations Commission on International Trade Law (UNCITRAL) has adopted the UNCITRAL Model Law on International Commercial Arbitration in 1985. The UNCITRAL has also adopted the UNCITRAL Conciliation Rules in 1980. The General Assembly of the United Nations has recommended the use of the said Model Law and Rules in cases where a dispute arises in the context of international commercial relations and the parties seek an amicable settlement of that dispute by recourse to conciliation.

India has also incorporated these uniform principles of alternative dispute resolution in the Arbitration and Conciliation Act, 1996 that was amended in the year 2015. The Arbitration Act provides for alternative dispute resolution mechanisms like arbitration, conciliations etc for national and international stakeholders. Nevertheless, the Arbitration Act has still not considered the use of information and communication technologies (ICT) for dispute resolution in the desired manner.

About Mediation

the pre-mediation has become mandatory the United Nations Commission on International Trade And Law (UNCITRAL) has adopted UNCITRAL model law on International Commercial Mediation and United Nations Convention on International Settlement Agreements resulting from Mediation, on 20 December 2018.

to strengthen the legal framework on international dispute settlement, India on 7th August 2019 became one of the first signatories to the United Nations Convention on Enforcement of International Settlement Agreements resulting from Meditation, also known as "The Singapore Convention".

And whereas UNCITRAL has brought a Model Law for giving effect to the Singapore Convention, it is considered expedient that India gives effect to the Singapore Convention by providing for provisions under a standalone mediation law for enforcement of international settlement agreements resulting from mediation.

And whereas a robust and effective mediation system greatly enhances the ease of doing business in India thus improving the country's attractiveness as a destination for foreign investment and collaboration.

a wide range of disputes including domestic and cross-border commercial disputes, matrimonial, and other personal disputes.