EVOLUTION OF THE INTERNATIONAL LEGAL FRAMEWORK (EU & UNCITRAL)

Key Incentives for the Success of ODR Schemes

ODR Forum 2013 Montreal

Cyberjustice Laboratory, Université de Montréal, 17-18 June 2013

Dr Pablo CortésSenior LecturerSchool of LawUniversity of Leicester

OutlineI. Recent legislative initiatives:

–Consumer ADR Directive and ODR Regulation–UNCITRAL Draft ODR Rules

II. The development of incentives to encourage, when appropriate:

• Participation in the dispute resolution process• Amicable settlements • Out-of-court enforcement

Part I: UNCITRAL Draft Rules on ODR

December 2010 UNCITRAL WG III issued first draft Rules on ODR (current draft of May 2013)

The Rules will be complemented by Enforcement protocol Requirements for third neutrals and ODR Providers Substantive law principles

UNCITRAL Draft Rules

• Scope of application: – low-value disputes (incl. B2B, B2C, and C2C)– cross-border –e-commerce

• Multi-step process in a two track system1.Negotiation2.Facilitation 3.Adjudication/Arbitration

• Enforcement of outcomes• Track I and Track II

EU Initiatives: Consumer ADR Directive

• Coverage: – Availability of ADR entities (public or

private)– Scope: contractual consumer complaints

arising from the sale of goods and provision of services in the EU

* Exclusion of claims brought by traders against consumers and claims related to health services and higher education

Cont. Consumer ADR Directive• Minimum legal standards

– Expertise, Impartiality and Independence– Transparency– Effectiveness– Fairness – Liberty – Legality

• Information obligation (and penalties for non-compliance)– Traders must inform when adhered to an ADR entity– ADR entities must inform about their own

procedures

ODR Regulation

ODR PlatformHub for e-commerce complaints in all the EC

languagesSlightly different scope: consumers may be

respondents when allowed by the gov where they habitually reside

Online traders will be required to include a linkConnects parties with nationally approved ADR

entities Case management toolManaged by the ODR advisors from ECCs

Two different institutional approaches to support the use of ODR

Part II: Incentives

To ensure the participation in ODR Traders will always make a cost-analysis Mandatory in specific sectors Online label or trustmark Feedbacks and reviews Rank down by online browsers Judicial cost penalties

Incentives

To ensure an early and amicable settlement Effective online negotiation tool Consumer bespoken information on their

rights Publication of model cases Couple with effective adjudication Saving the fees of adjudication

Incentives

To ensure out of court compliance of final decisions Public enforcement agencies should have

access to the information inserted in the ODR Plat

Links to e-Justice Collaboration with payment providers Black-lists Reviews

Conclusion

•Shift from developing judicial protection to building ODR structures that provide consumers with real and tangible redress

•The success of ODR will depend on• Assisting in the development of ODR infrastructure• Effective quality control mechanisms for neutrals and ODR providers, esp. once the private industry develops• Imbedding incentives for ensuring participation/settling/compliance