THE FATE OF CONSUMER DISPUTES FOLLOWING THE REGULATION AND DIRECTIVE ON ODR AND ADR

The importance of effective and low-cost dispute resolution between consumers and traders became crucial in the European Union with the establishment of the single market. When looking at consumer rights legislation in the EU, some fundamental questions need to be answered. Firstly, where can a consumer’s rights be protected? Secondly, Should it depend on the kind of goods or services consumed? Thirdly, should it depend on the jurisdiction where those goods were bought or the rights were infringed? The Regulation and Directive seek to answer these questions.

Background

On 29 November 2011, the EU Commission introduced two legislative proposals for a Directive on ADR and a Regulation on ODR for consumer disputes. At that time, the 2011 Commission Work Program identified consumer ADR as one of the strategic Commission proposals for that year. The legislation’s goal was to strengthen consumer confidence in the Single Market. Thus, the implementation of the Regulation and Directive aim to make the use of ADR methods in resolution of consumer disputes across the EU possible.

In accordance with the Directive a list of ADR entities that will have the jurisdiction to handle such disputes will be provided. The Directive and Regulation were meant to cover complaints filed by consumers against traders. However, they do not cover disputes between businesses.

Thus, the Directive on consumer ADR looks to fill the gaps in the coverage of ADR entities all over the EU and to popularise the use of ADR entities by consumers and businesses. In addition, it seeks to ensure that ADR institutions are of high quality and in line with the Commission recommendations.

Apr-Jun 2013 issue

Association for International Arbitration (AIA)