Retailers/insurers – Time to choose an ADR Provider – the Big Bang!
Following a consultation on the EU Directive on ADR/ODR, the government has announced that from October 2015, all businesses offering goods or services to consumers will need to have in place an ADR Scheme, to deal with any disputes. This is a short timetable and all businesses will have to move fast to comply.
Businesses such as retailers and insurers will have to ensure that ADR, provided by a certified ADR body, such as Promediate, is available for any dispute concerning contractual obligations with a consumer. There are also requirements on retail businesses to provide information about certified ADR providers on their websites or sales contracts in certain circumstances, and in the event of an unresolved dispute, all businesses must provide information about certified ADR providers. Certain businesses already have compulsory ADR schemes and other businesses can choose to join a scheme voluntarily. Where a business is not yet committed to using an existing compulsory or voluntary ADR Scheme, the government has set up a certification process for ADR providers such as ProMediate.
Retailers operating in areas where there is no ADR currently available would do well to start looking for an appropriate ADR provider to put in place before October 2015. The government has singled out retail as one of the sectors that should be targeted in the first year.
To ensure the scheme is credible, when a business agrees to the outcome of the ADR process then that agreement will be legally binding. This will allow consumers to enforce the agreement in the event that the trader does not abide by it. However, a mediation scheme like Click2Resolve is also a possibility.
In terms of information requirements, businesses with existing schemes must provide information about that certified ADR provider on their website and, if applicable, in the terms and conditions of any sales or service contracts. In the event of an unresolved dispute, all businesses must provide information about an appropriate certified ADR provider or providers to the consumer, and advise whether or not they will use ADR in an attempt to settle the dispute. These ADR information requirements will come into force in October 2015. Again, this means that businesses/traders will need to move quickly to amend their terms and conditions to include these information requirements. Promediate can arrange for your terms and conditions to be reviewed by our legal advisers to ensure that they are compliant.
All businesses who sell their goods or services online must provide a link to the ODR platform on their website. All websites which act as a platform for businesses to sell their goods and/or services must also provide a link to the ODR platform. These ODR information requirements will come into force in January 2016.