The world is becoming a smaller and smaller place when it comes to business. Developers in Mongolia write code and fix problems on business websites based in the U.S. while we sleep. Hundreds of dollars changes hand (virtually) for such a job the following morning.

E-commerce allows suppliers to fulfill international orders for widgets (real goods) and online entrepreneurs to provide their services or information products to buyers around the world in a matter of minutes.

But when it comes to the legal enforcement of contracts when something goes awry, this is where international business can still get a bit sticky. Jurisdiction becomes problematic. Where is the conflict properly resolved? And even if jurisdiction and venue properly reside in one country, there arises the very practical problem of personal jurisdiction and getting the other party to either respond to or defend a lawsuit outside his country of residence.

So what mechanism do we have for resolving international e-commerce disputes?

We can look to a relatively new, but rapidly developing version of alternative dispute resolution called Online Dispute Resolution, or ODR.

For all of my clients who conduct a fair amount of smaller transactions internationally, I always recommend implementing an agreement in the terms of purchase (or sale) of their services, programs or information products to utilize ODR in the event of any disputes regarding the transaction. Although some disputes may be initiated by purchasers requesting assistance from their banks or credit card companies directly via charge-back requests, at other times that process may not be available depending on the timing, or the terms that governed the purchase. (Either way, terms of purchase are paramount!) See this additional post regarding Merchant Accounts & Payment Gateways and the relevance of well drafted terms and conditions.

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For more information on Risk Management visit the following blog posts…..

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