The new European Online Dispute Resolution Platform for consumers and traders
If you sell goods or services to consumers online, or provide an online marketplace, you must inform consumers of the Online Dispute Resolution platform (ODR Platform) recently set up by the European Commission (https://webgate.ec.europa.eu/odr) even if you don’t intend to use it. We have noticed that many traders have yet to provide a link to the platform on their website or make amendments to their terms and conditions, so here’s what you need to know about the ODR Platform and how to comply with the mandatory information requirements.
What is the Online Dispute Resolution Platform?
If an EU consumer has a contractual dispute with a trader about an online purchase which cannot be resolved through the usual complaints process, the consumer can lodge a complaint with this EU-wide online platform. The platform has a useful translation function and allows consumers, traders and Alternative Dispute Resolution (ADR) providers to file documents and deal with disputes online.
Following receipt of a complaint, the platform identifies a suitable approved ADR provider for the dispute and if the trader and ADR provider agree, the ADR will go ahead as a confidential way of resolving the dispute outside of the court process.
A decision is usually made within 90 days of the ADR provider receiving the full complaint file making this a much quicker process than the court route. Traders may have to pay a fee to the ADR provider either per case or as an annual membership.
The European Commission hopes that the ODR Platform will improve both trader and consumer confidence in making cross border transactions but the platform can also be used to resolve disputes between traders and consumers within the same country. It is likely to be a useful alternative to the court process for lower value or less complex consumer disputes.
Mandatory notification requirements
Whilst online traders are not obliged to use ADR or the ODR Platform to resolve any consumer disputes (subject to any sector specific requirements), since 15 February 2016 it has been a legal requirement for traders to provide:
- A link to the ODR Platform on their website and on any offers made by email; and
- An email address (rather than just a contact form) on their website so that consumers have a first point of contact for seeking to resolve disputes.
Where a trader is required by contract, by law or as a result of trade association membership to use an approved ADR provider, they must give additional information to consumers. Not only must they provide a link to the ODR Platform on their website, they must also inform consumers of the existence of the platform and the possibility of using it to resolve disputes, and they must include this information in any standard terms and conditions of business. If an offer is made to a consumer by email, the email must contain a link to the ODR platform.
Penalties for non compliance
Failure to comply with these information requirements means that trading standards could apply for a court order requiring you to comply. Non compliance has a maximum penalty of an unlimited fine or up to two years’ imprisonment.
Ensuring compliance with these information requirements as well as ensuring that mandatory company information is displayed on your website will help enhance your company’s reputation by demonstrating integrity and commitment to customer service.
We would be very interested to hear of your experiences with the ODR Platform either from a trader or consumer perspective.