China’s central government has established China’s first Internet court to handle the growing number of disputes related to online shopping.
The new body, announced last week, is called Hangzhou Internet Court and is based in Hangzhou city, a city of about 9 million that is the home base of many Chinese e-commerce companies, including Alibaba Group Holding Ltd., China’s dominant online shopping company, and internet technology company NetEase Inc..
“The internet court could improve the efficiency of case handling because both parties of an e-commerce case are often not in a same city,” a spokesman for the court says in a statement.
“It’s a new path for us to solve the rising number of e-commerce disputes, since most of them have clear facts and solid evidence.” The new court says it will deploy business intelligence technology in the future to provide plaintiffs with guidance on the estimated probability of their winning before they take legal action.
Chinese authorities have been testing the concept for nearly two years with several regional courts in Hangzhou that created a website for these actions at zjwsft.gov.cn. Since August 2015 those courts have processed a total of 22,787 e-commerce cases online, with the average trial taking 30 minutes, according to Hangzhou Internet Court.
The court says online shoppers have saved millions of yuan in legal costs because they can manage the whole process online, including filing a lawsuit, submitting evidence and even attending court hearings through online video meeting technology. (One yuan is worth about 15 U.S. cents.) Online shoppers can file a suit online in just five minutes, according to Hangzhou Internet Court.
Besides e-commerce lawsuits, Hangzhou Internet Court says it also handles disputes relating to online payments and internet copyrights.
The number of lawsuits related to online shopping has surged in recent years along with China’s rapid e-commerce growth. In Hangzhou alone the number of e-commerce cases has grew from 600 in 2013 to over 10,000 in 2016, according to Hangzhou Internet Court.
Most disputes stem from purchases on popular Chinese online marketplaces, such as Alibaba’s Taobao. Consumers often complain about product quality and retailers’ return policies, according to Hangzhou Internet Court.
Online retail sales in China reached 5.16 trillion yuan ($752 billion) in 2016, representing 26.2% growth from 2015—more than double the growth rate of overall retail sales, according to China’s National Bureau of Statistics.