Dispute resolution in the virtual environment in Costa Rica

Interaction in the virtual world is not exempt from controversies, which has led to the development of policies and/or platforms for dispute resolution that attempt to adapt to the characteristics of globality, immediacy, and specificity inherent in the internet.

Just like with other projects in the virtual world, numerous possible “mechanisms” for resolving virtual disputes have been developed. However, many of these projects remain in the testing phase, with only a few cases managing to consolidate.

In this article, we will provide a brief overview of three examples of dispute resolution in the virtual world. The first example corresponds to the policy of the World Intellectual Property Organization (WIPO), which is one of the projects that has had the most sustained presence over time. The second example focuses on dispute resolution on Facebook, a widely used platform. Lastly, we will address more recent projects based on blockchain technology.

I. Dispute Resolution in Domain Names

WIPO has maintained a uniform policy and developed regulations for the resolution of disputes arising from the use of domain names. In very general terms, a “domain name” is the address we use to visit a website, such as consortiumlegal.com.

To apply this policy, the complainant must demonstrate that the disputed domain name is identical or similar to their own trademark, to the extent that it causes confusion among the public. Additionally, they must prove that the domain name holder has no legitimate rights or interests in the disputed domain (for example, not actively using the domain) and also demonstrate that the domain name is being used in bad faith (such as taking advantage of the confusion to attract people to a website). The remedies provided by the policy are limited to requesting the cancellation or transfer of the domain name.

The procedures are administered by providers authorized by the Internet Corporation for Assigned Names and Numbers (ICANN). According to the regulations, disputes are resolved by a panel of one or three members, who are selected from the list of panelists available to the center or provider responsible for managing the process.

The policy allows the parties to resort to judicial proceedings before or after initiating the procedure defined in the policy.

If the panel’s decision is to cancel the domain name, the policy stipulates that a period of 10 business days will be provided before executing the decision, during which the party may inform whether they have resorted to judicial means to settle the dispute.

For the “.cr” domain, dispute resolution rules are handled by the National Academy of Sciences through its NIC Internet Costa Rica Unit, and the dispute resolution policy is similar to WIPO’s provisions.

II. Dispute Resolution on Facebook

Interactions that take place within Facebook, as well as any other platforms within the Meta group of companies, are largely governed by policies dictated by the company itself. These are not norms issued by a political entity of popular will, such as a state congress.

This does not necessarily mean that the platform’s policies are in conflict with the laws of sovereign states. In principle, the company respects legislation to create rules tailored to the virtual environment, primarily based on the laws of the United States of America, where it is domiciled.

The fundamental basis of the platform’s policy framework is the “Community Standards,” from which other policies such as the “Merchant Agreement,” “Commerce Policies,” and “Advertising Policies” are derived.

It is important to note that, as a social network where messages, images, and videos are posted, many policies are aimed at regulating and reviewing the content that is published. For example, when an item is listed for sale, Facebook conducts a quick review to ensure that the content does not violate platform rules, such as the sale of drugs, before making the listing visible to other users.

Other measures that Facebook can take, according to the platform’s terms and conditions, include the removal of the post through which the product is offered, as well as the suspension or cancellation of the account.

The aforementioned is just a brief overview of a claims scenario in the Facebook environment. In this regard, in the event of a commercial dispute, we suggest checking the current and applicable policy based on the characteristics of the conflict.

Additionally, we want to caution that individuals who have been affected by a purchase made within the social network also have the option to resort to traditional channels to file any appropriate complaints against the person or company that sold them the product.

III. Dispute Resolution Mechanisms Based on Blockchain Technology

In this specific case, dispute resolution mechanisms are primarily based on protocols and focus on addressing disputes that cannot be resolved by the rules established in the smart contract under dispute (in simple terms, smart contracts are programs developed in blockchain technology that execute according to predefined conditions).

Examples of such mechanisms are the services offered by “Kleros” and “Aragon Court.”

In both mechanisms, cases are assigned to third parties who are registered on the platform and responsible for issuing their judgment on the dispute. In the case of Kleros, these third parties are called jurors, and in Aragon Court, they are called guardians.

To resolve a conflict on these platforms, a fee must be paid, usually in the form of tokens or cryptocurrencies specific to each platform. With the amounts paid by the parties, compensation is provided to the third parties responsible for resolving the dispute.

Both mentioned mechanisms allow for the possibility of filing an appeal if one is not satisfied with the initial decision. This is an interesting aspect as it demonstrates the depth of work and analysis invested in the development of these dispute resolution mechanisms, to the point of providing users with a second instance for the review of their disputes. It should be clear that a defined fee must be paid to access the appeal stage, as determined by the platform.


The examples presented above are just a glimpse of the proposals that have been developed in the virtual environment for dispute resolution. As we can see, there is a tendency to provide private solutions that resemble arbitration, and this may be due to the fact that conventional judicial processes may not adapt well to characteristics such as the global nature and immediacy of interactions on the internet.

Our intention with this article is not to delve into the specific details and potential challenges of the examples mentioned. We could address them in future articles, given that they are very interesting proposals, especially considering the prediction that their use may become more widespread in the near future.

Finally, if you want to learn more about the examples mentioned in this article, we suggest visiting the websites of WIPO, Facebook, Kleros, and Aragon Court.

WIPO: https://www.wipo.int/amc/en/domains/ Facebook: Community Standards: https://transparency.fb.com/policies/community-standards/?source=https%3A%2F%2Fwww.facebook.com%2Fcommunitystandards%2F Platform Terms: https://developers.facebook.com/terms/#compliancereviewrightsandsuspensionandterminationoftheseterms Commerce Product Merchant Agreement: https://www.facebook.com/legal/commerce_product_merchant_agreement/?ref=mp Purchase Protection Policies: https://www.facebook.com/policies/purchase_protection/?ref=mp Seller Performance and Accountability Policies: https://www.facebook.com/legal/merchant_policies# Information about Facebook Shops: https://www.facebook.com/business/help/2343035149322466?id=1077620002609475 Kleros: https://kleros.gitbook.io/docs/products/court Aragon Court: https://aragon.org/aragon-court

Litigation & Arbitration Department. You can contact us via the following email addresses:

Andrés Martínez Chaves, amartinez@consortiumlegal.com

Jose Pablo Valverde Marín, jvalverde@consortiumlegal.com

Gerald Hoffman Guillen, ghoffman@consortiumlegal.com

Josué Barahona Vargas, jbarahona@consortiumlegal.com