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Westminster Business Forum

I was pleased to be invited to speak at a recent (5th February) Westminster Business Forum on the forthcoming changes in consumer law and the implementation this year of the European Directive on Alternative Dispute Resolution (ADR) and coming into force of the Regulation on Online Dispute Resolution (ODR) for resolving consumer disputes online. The list of speakers and subjects, which included policy makers with key stakeholders, consumer bodies, trade associations, ADR providers, Ombudsmen, economists and lawyers, is available by clicking here.

I raised my concerns over the possible unintended consequences of the legislation (which I addressed in a paper published in Digital Democracy and e-Government and which can be downloaded from the link in my earlier posting here.)

I believe there is still time to address some of my concerns. For example, steps could be taken to require that websites selling products and/or services to consumers, once they become obliged under the new law to carry a link to the European Commission platform signposting consumers to independent ADR services to resolve their disputes, must also either state whether or not the trader will participate in ADR, or seeking to persuade the EC that their platform (still under development) pushes information onto the trader's website stating the proportion of referrals for disputes in which the trader has refused to participate.

It is important that one or other solution is put in place as else consumers will quickly begin to lose trust in the whole system . They will understandably feel that the link to the EU platform that they saw on the traders website at the time when they decided to make their purchase misled them into believing the trader would participate in ADR. Such would undermine the whole objective of the Directive and Regulation in increasing trust in the Single Market of the EU.

Similar loss of trust may result from the fact that the Directive permits ADR providers to take as long as 90 days to resolve consumer disputes. Such inefficiency and delay can only undermine the whole objective of requiring the ADR procedures to be conducted online. Speed is so critical to the public perception of justice. This problem is connected to the very low level of ODR required by the Directive being to simply permit claims to be filed and information to be exchanged online. This defines ODR as it was over 15 years ago. Technology has moved on a pace since then with intelligent systems, such as developed by Modria and others, fast tracking the resolution of disputes whilst at the same time increasing public confidence in the fairness and quality of the resolution system. By only requiring a quality from the last century, the message the EU has given to existing ADR providers and ombudsmen schemes is that they have little to do to update their existing systems.

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