With the assistance of an independent arbitration panel, new automated conflict laws could hold smart contract disputes out of the courts.

A task force established by the British government has introduced a conflict resolution mechanism to keep cryptocurrency and smart contract disputes out of the courts.

New Digital Conflict Resolution Rules are proposed in a 14-page study released by LawTechUK’s “U.K. Jurisdiction Taskforce,” which aims to provide a structured way of dealing with smart contract disputes.

Crypto-based conflicts may be settled without the need for significant court action under the new regulations. The legislation would make it possible to select an impartial tribunal to resolve disputes, and any conclusion made by the tribunal would be legally binding.

The laws also permit conflicts to be raised without revealing one’s name to someone other than the tribunal, preserving some of the anonymity provided by blockchain technologies. The manual further outlines the steps to file a complaint and the protocols to follow. Notably, if anyone wants to use the dispute settlement facility, they just have to say so in the smart contract agreement they’re making.

The state mentions that: “These rules may be incorporated into a contract, digital asset or digital asset system by including the text (which may be in electronic or encoded form) ‘Any dispute shall be resolved in accordance with UKJT Digital Dispute Resolution Rules’,”

If the tribunal’s ruling is to be followed, it should be done by courts based on English and Welsh law. The laws, according to Geoffrey Vos, Master of the Rolls (the chief of civil justice in England and Wales), will be applied in a variety of digital transactions in the future.

In the report’s foreword, Vos says: “I am confident that the Digital Dispute Resolution Rules will be incorporated into many types of digital transaction going forward. The UK Jurisdiction Taskforce will keep a close watch on how the Digital Dispute Resolution Rules are used and will aim to consider whether experience suggests they need revision within the coming year,” 

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