Decentralized Dispute Resolution in International Trade with Blockchain and Smart Contracts

Abstract

The increasing complexity of international trade agreements and cross-border transactions necessitates efficient, transparent, and enforceable dispute resolution mechanisms. Traditional methods of conflict solving like litigation and arbitration bear many drawbacks including time-consuming, high costs and jurisdiction issues. As a result, blockchain technology has become the element that enhances the mechanisms for the effective implementation of international trade law instruments on smart contracts and decentralized dispute resolution (DDR) platforms. Due to the primary property of blockchain, by forming smart contracts, it is possible to reduce contradictions that may arise from contractual uncertainty, delay in enforcement, and breaches. The immutability of the record storage in the blocks facilitates the discouragement of contract breaches and the enhancement of the performance reviews instead of legal remand. In addition, blockchain removes the intermediaries thus offers reduce on legal expenses and enhance access specifically to small and medium enterprises (SMEs) who engage in international business. This paper aims at exploring the use of blockchain based smart contracts in the resolution of dispute as well as minimizing conflicts and improving legal certainty in international business.