Courting the internet

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Hangzhou Internet Court is the first of its kind in China, and Sara Yu, deputy general counsel of Alibaba Group, was instrumental in setting it up. We sought her views on the institution.

China Business Law Journal: What is the background of the establishment of Hangzhou Internet Court, and what role did Alibaba play in it?

Hangzhou
Sara Yu

Sara Yu: In March 2015, we piloted the “E-commerce Online Court” with Zhejiang High People’s Court to resolve disputes in the field of e-commerce and to facilitate litigation “as convenient as online shopping”. In online dispute cases, the evidence is often electronic data. Once the litigation is involved, the online data must first be notarized, and then sent to the court for an offline hearing. After the case is over, we need to summarize the information in a case file and enter it into our system.

There are several problems here: (1) high cost. It involves notary fees, costs for employing persons to enter data, etc.; (2) low efficiency and low data utilization; and (3) litigation outside the home region. In online shopping, buyers and sellers are usually in different places. According to the principle of litigation jurisdiction that “the plaintiff accommodates to the defendant”, litigation outside the home region is very common, and very inconvenient.

In 2017, two years after the establishment of the online court, Zhejiang High People’s Court applied for the establishment of an internet court in view of the success of the pilot. As a result, the original “E-commerce Online Court” was upgraded to Hangzhou Internet Court.

CBLJ: When the parties have disputes on the Taobao platform, can they choose a solution outside the internet court?

Sara Yu: When a dispute occurs, users have multiple options to resolve it. For example, they can choose to complain directly to Taobao; they can also choose to use Alibaba’s “mass review mechanism” to resolve disputes over consumer rights protection; they can also call the government service hotline for administrative complaints. Furthermore, users can choose other courts than the internet court to file a lawsuit. In addition to Hangzhou, Beijing and Guangzhou each have an internet court. It can be said that the user’s choice is diverse.

CBLJ: Hangzhou Internet Court has been established for more than two years. What is the number of cases accounted for by Alibaba?

Sara Yu: In the current cases heard by Hangzhou Internet Court, there are also many involving other e-commerce platforms. The number of cases involving the Alibaba platform accounts for less than 50%. Although the technology used at the beginning of the court was provided by Alibaba, we have transferred relevant intellectual property rights to independent third-party companies, and they will continue to develop and operate the system in the future.

CBLJ: What kind of thinking does the co-operation with the court bring to you?

Sara Yu: I think that the cost and efficiency behind every dispute resolution mechanism, such as administrative complaint, arbitration, litigation, etc., are different. The most ideal state is that there is no boundary and division between departments. From the user’s perspective, it is to provide the dispute resolution mechanism with the lowest cost and the most efficiency. Then what remains is how these mechanisms and service providers solve the problem of mutual collaboration.

Litigation is only one of the ways to resolve disputes. We are also doing some pre-trial mediation work and diverting disputes to complaints, arbitrations and other channels to alleviate the pressure on the courts. Actually, the large number of dispute cases essentially results from the fact that society lacks consensus and standards for certain types of problems. If the consensus and standards are clear, the parties can solve the problem themselves, and you don’t have to go to the court.

CBLJ: Do you think Hangzhou Internet Court has promoted the improvement of the Chinese judicial system?

Sara Yu: That’s for sure. First, internet courts are open and transparent, and second, they have a higher sense of service and effectiveness. After the emergence of internet courts, the internet notary office and other internet institutions also appeared, one after another. So, it proposes new thinking directions not only for the judicial system but also for administrative management.