ODR and ADR – Are we ready?

July 31, 2014

The ways in which we choose to communicate have expanded. People used to meet to speak and physically walk into a shop to buy goods. Now the  telephone means voices are heard without faces and the internet allows us to shop from wherever we are. How easy though is it to resolve a dispute after an online transaction goes wrong? The EU-wide platform is designed to make it easier for consumers to be confident internet shoppers.

The European Parliament published a new Online Dispute Resolution (ODR) Regulation and a new Alternative Dispute Resolution (ADR) Directive in June 2013. The European Commission has said the new regime will allow disputes between consumers and traders over online transactions to be settled faster and at less cost than through the courts.  The creation of an ODR platform will link all the national alternative dispute resolution entities and will operate in all official EU languages. The Regulation states “Consumers and traders should feel confident in carrying out transactions online so it is essential to dismantle existing barriers and to boost consumer confidence. The availability of reliable and efficient ODR could greatly help achieve this goal”.

While it will be free of charge to use the platform, the cost of setting it up is estimated to be around 2million euros with a budget of 350,000 euros to maintain it. Given this investment, it is hoped that the scope of the platform will apply to domestic online transactions as well as cross-border ones. The platform will a) inform a trader that a complaint has been made against it; b) identify a competent ADR entity to the parties and c) provide the parties and the relevant ADR entity with access to a free electronic case management tool to enable the parties and the ADR entity to conduct the ADR procedure online if they wish to do so.

The ADR Directive is devised so that consumers can turn to quality alternative dispute resolution entities for all kinds of contractual disputes that they have with traders no matter what they purchased (disputes regarding health and higher education are excluded) and whether they purchased it online or offline, domestically or across borders.

Despite the increase in methods of communication over time there is no indication that this has lessened the number of misunderstandings or disputes; effective communication or the lack of it is still a factor in aggravating or appeasing a complainant. Member States are due to implement the ADR/ODR rules by July 2015 and the ODR platform will be operational in January 2016. It is hoped that the platform will provide a further avenue of communication to resolve disputes and in the meantime we can become increasingly comfortable with using technology as part of the ADR and mediation process.

Garden Court Mediation

Garden Court Mediation