Alternative Dispute Resolution (ADR)

ADR in Europe: an ECC-Net persective

The 29 European Consumer Centres (ECC-Net) help consumers engage in cross-border transactions more confidently by providing them with free information and advice on their rights and assist them in resolving cross-border consumer complaints. More than 120.000 consumers are assisted each year.

In May 2022, the ECC-Net conducted an indepth study among all ECCs on their practical experience with national ADRs in the handling of cross-border disputes. The survey covered both cooperation between ECC-Net and ADRs and the functioning of ADRs.

The survey also identified the main obstacles in practice when European consumers try to engage in ADR cross-border dispute settlement and shows possible improvements. The obstacles include lack of trader engagement and compliance and too much variation in coverage and quality when comparing ADRs in different countries and sectors. Language barriers and lack of easily accessible online procedures were some of the problems most often mentioned.

However, the survey also revealed that the ECCs in many countries report that ADRs are working well and that the ECCs and ADRs engage in knowledge sharing and cooperation activities on a national level.

The recommendations based on the survey results include the importance of ensuring more trader participation in cross-border ADR and the necessity to work for effective full ADR coverage in the EU. Recommendations also include finding practical ways to overcome language barriers and improve the online procedures and accessibility of ADRs in another country as well as strengthening the role of the ECC-Net in cross-border ADR dispute settlement

Trader engagement and compliance

European Consumer Centres listed traders’ unwillingness to participate in the dispute resolution procedure or failure to comply with the recommendation given by the ADR entity as the main area for improvement.

If a trader announces in advance that it does not intend to participate in the process, in many countries it is not expedient to take the dispute concerning this trader to a dispute resolution entity if trader involvement is necessary for the ADR to give an opinion or come to a decision. From the trader’s perspective, it should be noted that in many cases they refrain from participating in an ADR-procedure because they usually have to pay for the procedure, whereas it is free of charge for the consumer.

But also, non-compliance with ADR decisions and recommendations in countries and situations where ADRs provide such solutions is an issue, for consumers and ECCs representing their interests. Usually there are no sanctions involved if a trader doesn’t follow such outcome. In many countries consumers are not even informed by ADRs about the compliance rate of specific traders, as name and shame are not an option. Sector specific recommendations are often generic, not targeted at specific traders.

Variation in coverage and quality

The survey done by the ECCs underlines that ADR coverage and the quality of ADRs vary considerably. In some countries, the ECCs report that ADRs offer good service and support to consumers from other EU countries. In other countries the situation is reported to be the complete opposite with fragmented ADR coverage and consumers facing insuperable barriers when trying to make use of ADRs in a cross-border dispute. The following three obstacles have to be tackled to ensure a more coherent and effective ADR scheme in Europe.

Lack of coverage

The ECCs considered the absence of an ADR entity competent to deal with disputes in some countries a remarkable obstacle. In others, even though ADRs exist, they do not cover an entire sector or all traders. Even in those countries where full coverage is appraised, gaps in the system lead to traders not being subject to ADR procedures.

Language barrier

Language difficulties were also highlighted as consumers have to face the reality of 24 official EU languages. Most ECCs hoped that ADR entities would expand their language range to cover not only the official language(s) of their country of establishment but also English, in particular. Today there are dispute resolution entities in, for example, Germany, Belgium and Latvia that offer the possibility to use English as the language of processing

Easily accessible online procedures & vulnerability of consumers 

Feedback from the ECCs clearly shows a need for more use of easy accessible online procedures by national ADRs that engage in cross-border dispute handling. In cross-border e-commerce easy accessible online procedures are a must and in today’s economy absolutely possible. The same goes for dispute handling where legaltech solutions is a rapid growing business.

However, digital fragmentation and new vulnerabilities need to be taken into account. ECCs are well aware of the difficulties some consumers incur when trying to e.g. use online complaint forms. Not all consumers are in a position where they can, alone by themselves, file for an ADR procedure and follow through. In the public interest of consumer protection safety nets need to be put in place, with sufficient human resources, to assist those in need.

The role of the ECC-Net in the European ADR scheme

The ECCs do a lot already in practice to ease the consumers’ access to and use of ADRs situated in other EU countries. There is within the Network considerable focus on enabling all consumers - including those considered as vulnerable consumers - to make use of cross-border ADR dispute settlement schemes.

The most frequent assistance is to broaden our services to include help with filing complaints and to translate correspondence and decision when consumers are not able to do so themselves due to e.g. language barriers and difficulties in understanding procedures and forms.

However, the ECCs are limited in their access to assist consumers due to scarce resources and the constraints linked to the current role of the ECCs.

The ECCs engage themselves actively in cooperation with ADRs in all Member States. The level and intensity in the cooperation varies and depends on many factors related to the ADR scheme in each country.

Regular meetings with ADRs, cooperation protocols and agreed contact persons, trainings, joint events and information material, joint case law studies and ECC employees participating in ADR committees are all examples of ways ECCs cooperate with ADRs today.

On the other hand, ECCs also reports on situations where cross-border cases are looked at as problematic by the ADRs and where the status of the ECCs makes cooperation difficult.

Detailed survey questions ans responses

ADR coverage and availability for cross-border cases

Survey conducted via Webropol in May 2022. Invitation e-mail and link sent to the Directors of each ECC. All 29 ECCs answered the survey. 

The survey touched upon ADR coverage and availability for cross-border cases and the responses were quite diverse among the centres depending on their own experience with their national ADR bodies. 

As the Directive 2013/11/EU followed a minimum harmonization approach it is very normal that the below table indicates such big discrepancies between “awesome” coverage and “so-so” coverage, Member States having taken different approaches.

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Overall, how do you see the ADR coverage/availability in your country (cross-border cases)?

Awesome – When we do not succeed finding an amicable solution our ECC is always able to transfer or signpost consumers with a relevant cross border case to an ADR in our country. 

Very good – When we do not succeed finding an amicable solution our ECC is very often able to transfer or signpost consumers with a relevant cross border case to an ADR in our country. 

Good – When we do not succeed finding an amicable solution our ECC is often able to transfer or signpost consumers with a relevant cross border case to an ADR in our country.

So-so – When we do not succeed finding an amicable solution our ECC is only sometimes able to transfer or signpost consumers with a relevant cross border case to an ADR in our country. 

Not good – When we do not succeed finding an amicable solution our ECC is seldom or never able to transfer or signpost consumers with a relevant cross border case to an ADR in our country.

Our centres were also asked to comment on the performance of the ADR bodies of their countries when it comes to cross-border cases based on their own experience. Interestingly, 13 centres responded that the ADR performance in their country is more than good. While 7 centres responded that its sufficient and 8 responded that the performance is not adequate to the needs of consumers.

Trader compliance

The next topic examined, by the internal survey handed to all 29 ECCs, was about trader compliance. The statistics below clearly indicate that there are a few instances in which traders are obliged to or always comply with the ADR decision, but in most of the cases the compliance is left to the discretion of each specific trader.

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Overall, how do you see the trader compliance with ADR?

Awesome – The traders are obliged to follow ADR decisions or always comply with the decisions from ADR. 

Very good – The traders almost always comply with the decisions from ADR. 

Good – The traders often comply with the decisions from ADR. 

So-so – The traders only sometimes comply with the decisions from ADR. Not good – The traders seldom or never comply with the decisions from ADR.

Not good – The traders seldom or never comply with the decisions from ADR.

ECC Assistance to consumers with a cross-border complaint

The ECCs current service/support level to consumers who have to turn to an ADR can be divided into two categories: 

• Transfer = Assist the consumer with filling the complaint to the ADR and monitor the case and communicate on behalf of the consumer during the ADR process. 
• Signpost = Inform the consumer (via the ECC in the consumers’ country) about the possibility to turn to a certain ADR

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Signposting cases to ADR bodies:

Out of the 29 ECCs, 38% only signpost cases to an ADR body without intervening at the process or transferring the case. Among the reasoning for only signposting and not transferring cases as well, were:

•  ECCs signpost most commonly when the ADR allows submissions in English or other languages, and corresponds in these languages too, so consumers can do it directly also in cross-border cases. 
• The system requires the creation of personal credentials and/or payment of fees, which makes it mandatory for the consumer to be the one submitting the case. 
• ADR bodies refuse to accept cases submitted by the ECCs and require direct submission by the consumer. 
• Lack of ECC resources – signposting is less time consuming and the only option for a few ECCs.

Even though currently 11 ECCs signpost only instead of transferring cases to ADR bodies as well, because of the reasons mentioned above, 9 of them would actually help consumers to fill in the ADRs’ application forms as well and 8 out of the 11 would also help the consumers by translating ADR answers to their national language.

If your ECC signposts, would your ECC help consumers to fill in the ADRs application forms? 

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If your ECC signposts, would your ECC help consumers by translating answers of the ADR from national language?

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Transferring cases to ADR bodies

When it comes to ECCs transferring cases to ADR bodies which includes active involvement of the ECC’s legal advisors, the main criteria entailed in this decision are:

•  Consumers have credible claims and pressure will be added to the traders by the involvement of ECCs; 
• There are language barriers and consumers need assistance by the ECCs; 
• A cooperation protocol already exists between an ECC and an ADR body which eases the handling and follow up of the case on behalf of the consumer.

Further ECC cooperation with ADRs

he European Consumer Centres value an active dialogue and exchange with their national ADR bodies. When it comes to cooperation activities between ECCs and ADR bodies, 23 out of 29 ECCs are having regular meetings and exchanges with ADR bodies. From the responses of the European Consumer Centres, it is apparent that a quite active dialogue and cooperation between ECCs and ADRs already exist and can result in addressing existing burdens in the area of ADR.

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Improving the ADR scheme

The ECC-Net was asked to also suggest improvements when it comes to the better functioning of ADRs in cross-border disputes. Trader acceptance and engagement was the most voted aspect for improvement with 65.5% of ECCs choosing it. The next two, receiving 44.8% and 41.4% of ECCs answers, were about overcoming language barriers and creating better fitted online interfaces and procedures to make participation from another EU country feasible for consumers. 

Among other aspects that could possibly be improved were: 

• Better coverage & sector specialised ADR bodies 
• Faster case-handling, prevention of backlog 
• Lower fees 
• Better understanding of applicable law of another EU country and expertise
• Better information and awareness of consumers 
• Traders to adhere to sectoral ADRs

If ADR(s) in your country could be more relevant for consumers in cross-border disputes, what would be the most important things to improve?

In your opinion, what would it take to improve the ADR scheme in your country and make ADR work better in cross-border disputes?

The role of ECC-Net: an engagement for the future

In order to overcome burdens consumers face, there is a common willingness among the European Consumer Centres to actively help consumers as much as possible when it comes to an ADR dispute. Many consumers still need human interaction and personalised help. 

The same willingness applies to the cooperation of ECCs with their national ADR bodies. Consumers ADRand ADRs receiving their complaints could benefit from the positioning, legal expertise, and uniqueness of the Network, being able to rely on 29 centres in each EU country, Norway and Iceland.

The next two charts describe the assistance ECCs feel they could provide to consumers and ADRs but also the requirements that need to be fulfilled in order to strengthen our collaboration and involvement.

If your ECC, as trader ECC, should do more to help consumers with a cross-border case that can be handled at an ADR, what kind of assistance would then be most relevant in your country? Select the 3 most important ones.

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If your ECC, as trader ECC, should do more than today to help consumers with cross-border cases at an ADR, what would need to change in order for your ECC to be able to help more?

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