Saturday, 3 December 2011

A step away from out-of-court dispute resolution for European consumers

Also on the 29th November (that was one busy day), the European Commission proposed two new legislative products on alternative dispute resolution, according to the schedule for 2011 that was announced at the beginning of this year (see previous post "Who needs courts?..."). These two proposals are to enable European consumers to solve their problems with traders without going to court, regardless of the kind of product or service that the contractual dispute is about and regardless whether they bought it in their home country or in another Member State (cross-border transactions). It has been estimated that if a universal, of good quality alternative dispute resolution (ADR) system (which means that dispute is solved by a neutral party, e.g. arbitrator, mediator or ombudsman) is introduced across the EU it could save consumers ca 22,5 billion EUR a year. European Commission focuses also on protection of consumers shopping online, planning to create an EU-wide single online platform, which will allow to solve contractual disputes online within 30 days.

Among the newly adopted proposals there is the Directive on consumer Alternative Dispute Resolution (ADR) and the Regulation on consumer Online Dispute Resolution (ODR). The Directive aims at creating out-of-court entities that would solve any contractual disputes in B2C relations. These ADR entities would have to be well-qualified, transparent, impartial, effective and fair. It would be an obligation of the trader to inform the consumer about the ADR entity which could deal with a potential contractual dispute. ADR entities are to resolve the disputes within 90 days. The Regulation, on the other hand, would focus on enabling resolving online disputes between consumers and traders located in different Member States and would create an online platform (ODR). The system is to send consumers' complaints automatically to the competent national ADR entity and it's supposed to resolve the dispute within 30 days.

Q&A on the proposals may be found here.

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