International Journal of Online Dispute Resolution

Article

European Businesses and the New European Legal Requirements for ODR

Keywords online dispute resolution (ODR), alternative dispute resolution (ADR), consumer disputes, EU legislation, e-commerce
Authors Graham Ross
Author's information

304637 Graham Ross
Head of the European Advisory Board to Modria.com Inc, Member of the Civil Justice Councils’ ODR Advisory Group and of its ADR Working Party, and Fellow of the National Center for Technology and Dispute Resolution.
  • Abstract

      In terms of practical use outside of e-commerce platforms such as eBay, ODR has not advanced as speedily as many thought might be the case. Two pieces of legislation by the European Parliament applying to consumer disputes, being the European Directive on Alternative Dispute Resolution For Consumer Dispute and the associated Regulation on Online Dispute Resolution have opened up the opportunity for that to change. For the first time, there now is a law that effectively requires businesses to promote ODR. However, with widespread breach, evidence of which is referred to in this paper, this law has not as yet been implemented or honoured as it should be and is in danger that its impact could thereby become counter-productive to its essential objective, albeit not its whole scope, in increasing public confidence in cross-border buying of products and services online. One problem is that the EU decided in their wisdom to stop short of making participation in online ADR mandatory. So we have the odd situation in which it is an offence for businesses to not inform a dissatisfied customer of the web address of an online ADR provider who has been approved under the legislation by the Chartered Trading Standards Institute, yet when that customer seeks to use that service the business can refuse to participate. If refusal to participate is extensive, the situation could lead to a loss of trust generally in a law designed to improve consumer rights and access to justice. This is especially so if traders carry on their website the mandatory link to an EU portal that will refer dissatisfied consumers to an approved provider of online ADR, and which may have been a deciding factor for that consumer in selecting the particular trader to buy from, yet, when a complaint arises, refuse to participate in the provider selected by the consumer.
      Whilst awareness of ODR will grow as a result of this legislation, albeit as an awareness of ADR that will, in the sense of the medium for discussions and exchange of documents, operate online, I have concerns that broad awareness of the fullest extent of what ODR can offer by way of more advanced forms of ODR will not be fully achieved for some time. Whilst this law does indeed present a significant opportunity to expand the use of ODR, it will not happen without effort by those with interests, commercial or otherwise or both, in promoting the expansion of access to justice that ODR offers. Only in this way will this legislation help ensure that there is a commercial need to explore increasingly innovative technology.
      There is an even greater opportunity currently being lost by this legislation beyond consumer disputes. Given that ODR can enable mediation to take place at much more proportionate cost for disputes below the higher levels of value, ODR offers the opportunity to increase mediation’s share of ADR over arbitration. Further, if the public can begin to experience mediation in the busier field of consumer disputes, it would help more quickly embed mediation into our society’s vision of justice and make engagement in mediation for more complex disputes much more frequent. Instead, by lumping mediation in with ombudsman style adjudication, as does this legislation, a much less satisfactory process with at least one party, and often both, dissatisfied with the outcome, it lowers the satisfaction level of all forms of ADR.

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