Online Dispute Resolution (ODR) Platform for Electronic Commerce

Our E-Arbitration-T Project Online Dispute Resolution (organized by Eduardo Paz Lloveras and funded by the European Commission in 2000) was the first approach for an online dispute resolution mechanism for electronic commerce matters. (See The origins of E-Arbitration-T concept )

In 2013, the European Commission launched directive on alternative dispute resolution for consumer disputes which seeks to encourage traders and consumers to participate in these out-of-court mechanisms for resolving disputes. The directive does not give a consumer the right to force a business to use alternative dispute resolution procedures, although member states remain free to make participation mandatory.

In order to encourage the use of such mechanisms, the directive requires member states to ensure that these procedures are available where both parties agree to use them to resolve their dispute. The directive further provides for the establishment of entities to mediate disputes initiated by consumers against traders.
The directive does not deal with disputes initiated by traders or disputes between traders, and only applies to traders established in the EU and consumers resident in the EU in relation to contractual obligations stemming from sales or services contracts, both online and offline. The scope of the directive excludes health care services, public providers of further or higher education, and non-economic services that are performed for no economic consideration.
There is also an dispute resolution for online purchases. EU Regulation 524/2013 on online dispute resolution for consumer disputes entered into force in January 2016, and applies directly in all member states. The regulation obliges the EU Commission to set up a European-wide online platform specifically designed to help consumers seek redress if they have a problem with online purchases.

The Commission has indicated that the platform will be operational as from February 15 and it will be accessible through HERE.
The scope is to create a a single point of entry for consumer and traders alike, free of charge and fast.

The most important facts for traders and consumers:

  • The ODR Platform is an interactive and multilingual platform specifically designed for assisting consumers who have a complaint about goods or services they have bought online.
  • Consumers or traders, when agreeing to ODR, must complete an electronic complaint form, made available on the ODR Platform.
  • The parties then decide which ADR entity shall be competent to settle their contractual dispute. The ADR entities are bodies that comply with the binding quality requirements established by the ADR Directive and which are included in the national lists of ADR bodies.
  • The selected ADR entity shall handle the case entirely online and reaches an outcome within 90 days. The legal value of the decision of the ADR entity will depend on the form of ADR chosen (mediation, arbitration, conciliation, etc).
  • What do I need to do as an online trader?:As a trader engaging in online sales or service contracts with consumers and established within the European Union you will have to inform consumers about the existence of the ODR Platform as well as the possibility of using the ODR Platform for resolving your disputes.

More specifically, keep the following requirement in mind:

  • You must provide on your website(s) an electronic link to the ODR Platform and your own e-mail address. That link must be easily accessible for consumers.
  • If you make commercial offers to consumers via e-mail, similar information should be included in the e-mail.
  • The information shall also be provided in the general terms and conditions applicable to online sales and service contracts.

European Union and Israeli initiatives on arbitration and dispute resolution

The European Commission-sponsored program known as ADR-MEDA presented last week an intensive workshop and forum on the Israel Bar in Tel Aviv. The workshop was attended by leading experts in mediation to discuss alternative dispute resolution (ADR) issues in the legal and business community in Israel and the EU. The workshop and forum were both presented by Manon Schonewille of the Netherlands, the executive director of ACB Group.

Besides the workshop and forum, Schonewille used her visit in Israel to promote mutual efforts to advance awareness, acceptance and the use of international arbitration and mediation in the MEDA countries (Israel, Algeria, Egypt, Jordan, Lebanon, Morocco, Syria, Tunisia, Turkey and West Bank & Gaza), with special attention to small- and medium-sized enterprises (SMEs). The intention of the European Commission’s initiative is to assist SMEs to resolve international commercial disputes arising from business transactions between Middle Eastern countries and EU-based companies, in order to enhance business transactions between companies based in two or more Middle East countries. Continue reading European Union and Israeli initiatives on arbitration and dispute resolution