Online Dispute Resolution – What you need to know about EU Regulation 524/2013
In June 2013 the European Parliament published a Directive on Alternative Dispute Resolution (ADR) for consumer disputes, supported by a Regulation on Online Dispute Resolution (ODR). Member States were required to implement the Directive by July 2015. The Regulation on ODR came into force on 9 January 2016.
The Regulation on ODR was designed to establish a system whereby consumers and businesses could settle UK domestic and cross-border disputes within the European Union (EU). The European Commission will establish an online European ODR Platform, designed to assist consumers who have purchased goods or services online and subsequently find themselves in dispute with the seller or supplier.
The ODR Platform will allow contractual disputes to be resolved between parties without the necessity to issue court proceedings, using techniques such as "e-negotiation" and "e-mediation". Consumers will be able to lodge a dispute using the ODR Platform, which will be linked to national ADR providers. The ADR providers will then assist with resolving the dispute.
In December 2015 the Department for Business Innovation and Skills (BIS) announced that the European Commission would delay the launch of the ODR Platform until 15 February 2016. This means that enforcement of the obligations under the Regulation would be delayed until after that date.
How will this affect businesses?
The Regulation on ODR applies to all privately owned and publicly owned traders established in the EU which sell goods and/or services to consumers online or through a website. A business will be caught by the Regulation if it offers goods or services, or a consumer purchases goods or services, via their website or by other electronic means. "Any other electronic means" includes social media, email, telephone, fax and text messages.
Online traders are required to display an electronic link to the ODR Platform on their website and an email address for consumers to use if they have a complaint. In addition to this, online traders will be required to provide a link to the ODR Platform in any email correspondence making an offer of a consumer sales or service contract. This means that online sales terms and conditions, websites and standard documentation and emails will require updating.
The ODR platform will not be available for disputes between traders.
How will this affect consumers?
The introduction of an ODR Platform will help consumers seek redress from online traders, especially from outside the UK, but within the EU. It will facilitate access to ADR and will provide access to an ODR contact point to assist consumers with disputes submitted via the ODR Platform. This will be particularly useful for consumers where the dispute is with a trader based outside the UK.
Traders and consumers should make themselves familiar with the ODR Platform following the enforcement in February 2016. This may form the first port of call for assistance in relation to a potential dispute against a trader.
Traders will have to comply with the terms of the Regulation and should ensure that necessary amendments have been made by 15 February 2016.
If you have any concerns, or would like us to review your website in light of the Regulation, please email us at email@example.com and reference this article.