Online Dispute Resolution for Consumers

Dispute Resolution

Online Dispute Resolution for Consumers

In the beginning of 2016, the EU Regulation on online resolution for consumer disputes (EU) No 524/2013 came into force. It sets out a common framework for online consumer dispute resolution across the European Union.

The Regulation

The Regulation aims at diminishing the barriers for cross-border shopping and selling within the European Union. The new Regulation creates a simple, efficient, fast and low-cost way for resolving disputes arising from the sale of goods or provision of services. Therefore, it provides for a European platform (the “ODR platform”) that shall facilitate the independent, impartial, transparent, effective, fast and fair out-of-court resolution of disputes between consumers and traders online. The provisions of the Regulation apply to the out-of-court resolution of disputes. Those may concern contractual obligations stemming from online sales or service contracts. The only conditions is that the Consumer is resident in the European Union and the Trader is established within the European Union. These disputes are to be resolved through the intervention of an alternative dispute resolution (“ADR”) entity of a Member State of the European Union which involves the use of the ODR platform (all of this entirely online).

The ODR Platform

The platform shall be a single and central contact point of entry for consumers and traders seeking out-of-court resolution of disputes. The platform that can be used free of costs. The complainant (trader or consumer) can fill out a standardised electronic complaint form which will be redirected to the ADR entity determined in the complaint. ADR entities are to include various sectoral conciliation boards relating to special sectoral matters,. Those may include ones controlled by E-Control, Regulatory Authority for Broadcasting and Telecommunications, Agencies for flight passenger rights,  general conciliation boards for consumer businesses, etc. In order to enable consumers to use the ODR platform for out-of-court dispute resolution, traders established within the European Union engaging in online sales or service contracts and online marketplaces established within the European Union are obliged to inform the consumer on their website about the existence of the ODR platform. They should also provide a link to the platform and provide their email address. An infringement of this obligation may lead to an administrative penalty up to EUR 750.

Although the traders are obliged to inform consumers about the existence of the platform, the participation in the ADR proceedings is voluntary. Therefore, currently the success of the measures established by the Regulation cannot be assessed.

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