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New EU Online Dispute Resolution (ODR) Regulation creates new obligations for online businesses
From 15 February 2016 the EU’s new online dispute resolution (ODR) platform became operational.
Under EU Regulation 524/2013 (“the Regulation”) consumers and traders within the EU can use the ODR platform to refer contractual disputes between a consumer and a trader in relation to goods and/or services purchased online to an agreed alternative dispute resolution (“ADR”) provider. As well as providing the parties with an alternative way to resolve disputes, the Regulation also requires online traders to provide certain information on their website to ensure that consumers are aware of the new ODR platform. That information is the contact email address for the trader and this link http://ec.europa.eu/consumers/odr to the ODR platform. The aim of the Regulation is to provide consumers with a practical approach to resolving domestic or cross border disputes in their own language without the need for court proceedings. It is hoped that this should encourage EU consumers to buy from traders in other EU states, knowing that there is a relatively easy way to resolve any problems that might arise without any language barriers.
The link to the ODR platform needs to appear on the trader’s website, in its terms and conditions and in any email sent making the offer to sell the goods and/or services. If the trader is subject to mandatory ADR under separate rules applying to it, then it must also explain this on its website. Traders wishing to avoid criticism would be wise to explain the purpose of the link.
The ODR platform allows consumers to submit their dispute to the platform in the EU language of their choice, and then use an online ADR procedure to resolve the dispute. The platform will transmit any disputes submitted to the respondent party who, unless it is subject to mandatory ADR, will have the right to choose the ADR provider from a list on the platform, or decline to deal with the dispute. Once the ADR body is agreed by both parties, the ODR platform will automatically submit the dispute to the chosen ADR body which will deal with the case entirely online and will reach a decision within 90 days. If the parties fail to agree on the ADR provider, or the ADR provider refuses to handle the dispute, the complaint cannot be processed any further.
The ADR provider will set the level of cost that it will charge the parties to deal with the ADR.
The ODR platform does not replace a consumer’s right to commence legal proceedings, but it is hoped that the new platform will encourage the parties to resolve the dispute without court process.
There is no penalty for UK traders who do not comply with the Regulations but Trading Standards has the power to order a trader to comply and seek imprisonment or a fine for the trader if it defies the order.
This is for information purposes only and is no substitute for, and should not be interpreted as, legal advice. All content was correct at the time of publishing and we cannot be held responsible for any changes that may invalidate this article.