seminar on out-of-court disputes resolution of consumer disputes

SEMINAR ON OUT-OF-COURT DISPUTES RESOLUTION OF CONSUMER DISPUTES

Belgrade, 27th and 28th June 2013

Sava Centar



Avenues and barriers to consumer redress

Prof. Thierry Bourgoignie

IPA Project team leader and Key legal expert

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Enforcement as a priority

The perception by consumers that the LCP is enforced swiftly acts as a driver for increasing consumer confidence, preventing consumer frustration and as a deterrent to traders seeking to evade consumer protection rules.

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Barriers to access-to-justice

1. Awareness deficit

2. Information/legal advice deficit

3. Obstacles to judicial redress or access to courts

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3. Obstacles to judicial redress or access to courts

3.1. Contract terms depriving or discouraging the consumer from going to court = void as being unfair.

3.2. Psychological/cultural obstacles, i.e. courts perceived as distant from consumer needs, not interested in ealing with small claims, not neutral.

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3.3. Formalism and time; repeat players (trader) vs. one-shot litigant (consumer).

3.4. Cost, i.e. lawyer’s fees, court/procedural fees, expertise-related costs. For small claims, costs are likely to exceed gains or benefits.

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3.5. Limits to legal standing:

Individual interest vs. Collective interest approachNo legal standing to the competent market

monitoring/surveillance authority to submit cases before civil courts.

Limited legal standing to COs (LCP, Art.137).

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3.6. Lack of expertise of judges in consumer protection matters.

3.7. All above deficits and obstacles are even more actual when cross-border cases are at stake + 2 additional and complex issues: Choice of competent court Choice of applicable law

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Plurality of enforcement mechanisms

1. Interplay between public enforcement and private enforcement tools: Public, i.e. prosecutors and market surveillance body(ies):

adequate market monitoring, adequate sanctions including injunctions and means of collective redress.

Private, i.e. individual consumers and Cos: adequate consumer remedies, including injunctions and means of collective redress.

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Plurality of enforcement mechanisms

2. Interplay between mandatory/binding and voluntary/non-binding tools:

Mandatory/Binding: court decisions and arbitration sentences are binding on the parties.

Voluntary/Non-binding: use of ADRs schemes remain voluntary; results of direct negotiation, conciliation attempt or mediation is not binding.

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The need to admit a wide range

of enforcement mechanisms Raising consumer awareness about their rights (IPA

project) Developing a newtwork of legal advice centers

(MFITT, COs) Simplifying judicial redress for small claims and/or

consumer disputes (Law on Civil Procedure, new chapters XXXIII and XXXV).

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The need to admit a wide range

of enforcement mechanisms Broadening the scope of injunctions under the LCP Granting to COs and competent market surveillance

body the right to seek compensation for the damage caused to the collective interest of consumers.

Promoting non-judicial means of consumer redress. = ADRs and ODRs.

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Out-of-court disputes resolution of consumer disputes in EU member States

ADR schemes have emerged in all member States. Countries with a more developed consensus culture

are usually more advanced: e.g., Scandinavian countries, The Netherlands, Austria, Uk vs. France.

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Out-of-court disputes resolution of consumer disputes in EU member States

There is a multitude of operating schemes: direct negotiation, mediation, arbitration, mixed scheme. Administrative system (Scandinavian countries) vs

Collective bargaining among private stakeholders (The Netherlands).

One-sided (Consumer call center) vs two-sided initiative.

Every state has its own mix – No <ideal> ADR system.

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Need to inform the consumer about the availability, conditions for access, nature, rules, cost and legal effect of the proposed scheme.

Need to ensure that the scheme is <consumer friendly> Fair justice calls for a network of ADRs schemes

throughout the country.

= definition of common standards for the operation of ADR schemes = purpose of this seminar.

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Agenda of this seminar

Stage 1: EU response to the need for out-of-court resolution of consumer disputes:

promoting ADRs, setting common standards, regulating ODRs.

Stage 2: Experiences with out-of-court resolution of consumer disputes in Serbia: concepts and practice.

Stage 3: ODRs

Stage 4: IPA Project proposals regarding ADRs and ODRs in Serbia.

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seminar on out-of-court disputes resolution of consumer disputes

Documents