Internet law: “ADR” & “ODR”

Alternative Dispute Resolution (ADR):

“proceedings in which the parties are assisted by a third person to settle a dispute are referred to by expressions such as conciliation, mediation, neutral evaluation, mini-trial or similar terms. Various techniques and adaptations of procedures are used for solving disputes by conciliatory methods that can be regarded as alternatives to more traditional judicial dispute resolution.” (UNCITRAL: Model Law on International Commercial Conciliation 2002)

•       Definitions

•       Characteristics

•       Impact on traditional international trade

On-line Dispute Resolution (ODR):

•       “is a broad term that encompasses many forms of ADR and court proceeding that incorporate the use of the internet, websites, e-mail communications, streaming media and other information technology as part of the dispute resolution process. Parties may never meet face to face when participating in ODR. Rather, they might communicate solely online.” (American Bar Association Task Force on E-Commerce and ADR)

•       “A mechanism for resolving disputes facilitated through the use of electronic communications and other information and communication technology” (UNCITRAL Draft Procedural Rules on On-line Dispute Resolution for Cross Border Electronic Commerce Transactions 2013 Art. 2.1)

WHY ?

1. Increasing e-commerce transaction and generally internet related disputes
2. The cross-borders multiple jurisdictions
3. Different governing laws
4. Low value of the transactions
5. Traditional litigation system is expensive and slow
6. Difficult to enforce foreign judgments
7. Cyber related disputes may require a legal expert
8. Less costly more efficient solution

In the European Union, ADR/ODR procedures can take different forms and they can have different names

•       arbitration

•       mediation

•       ombudsmen

•       complaints boards

The ADR Directive aim is ensuring that consumers have access to ADR for resolving their contractual disputes with traders.

No matter

a)      what product or service has been purchased,

b)      whether the product or service was purchased online or offline

c)       whether the trader is established in the consumer’s Member State or in another Member State.

EXCLUDED: disputes regarding health and higher education

Member States will establish national lists of bodies offering ADR procedures (ADR bodies). All ADR bodies included in those lists will have to comply with binding quality requirements.

Member States list at : http://ec.europa.eu/consumers/solving_consumer_disputes/non-judicial_redress/national-out-of-court-bodies/index_en.htm

ADR
OFFICIAL BODIES IN UK

1.            The Energy Ombudsman

2.            Office of the Telecommunications Ombudsman (Otelo)

3.            The Financial Ombudsman Service

4.            Direct Selling Association

5.            The Property Ombudsman

6.            Association of British Travel Agents - ABTA Ltd

7.            The Furniture Ombudsman

8.            British Vehicle Rental and Leasing Association (BVRLA)

9.            Finance and Leasing Association Conciliation and Arbitration Scheme (FLA)

10. Surveyors Ombudsman Service
11. Communications and Internet Services Adjudication Scheme (CISAS)
12. The CEDR Solve Low Cost Mediation Service
13. The CEDR Solve Low Cost Mediation Service for Northern Ireland
14. The CEDR Solve Small Claims Arbitration Service
15. The CEDR Solve Credit Agreement Arbitration Service
16. Consumer Credit Trade Association
17. Chartered Institute of Arbitrators
18. Postal Redress Service (POSTRS)

In order to facilitate the transposition of the ADR Directive, the Commission has established an Expert Group composed of national ADR experts.

The reports of the expert group’s meetings are available in EU web site : http://ec.europa.eu/transparency/regexpert/index.cfm?do=groupDetail.groupDetail&groupID=2879&NewSearch=1&NewSearch=1

ODR Regulation

It is only applicable to resolve consumer contractual disputes

“Consumer” definition under this Regulation covers:

Natural persons who are acting outside their trade, business , craft or profession.

If the contract is concluded for purposes partly within and partly outside the person’s trade and the trade purpose is not predominant in the overall context, that person can be deemed as a consumer.

ODR PLATFORM

A web-based platform that is specifically designed to help consumers who have bought goods or services online and subsequently have a problem with that online purchase.

Consumers can submit their contractual dispute and conduct the ADR procedure online in any of the 23 official languages of the European Union.

HOW DOES IT WORK

The ODR platform transmits disputes only to ADR bodies who are included in the national lists of ADR bodies that comply with the binding quality requirements established by the ADR Directive.  

Online traders will be obliged to provide a link to the ODR

Platform on their websites.

Is operational as of 9 January 2016 and made accessible in stages. It will become accessible to consumers and traders on 15 February 2016

http://ec.europa.eu/odr

IN PRACTICE?

➢  Consumers will submit a complaint through the ODR platform, in the language of their choice.

➢  The ODR platform will notify the trader that a complaint is lodged against him.

➢  The consumer and the trader will then agree on which ADR entity to use to solve their dispute.

➢  The chosen ADR entity will receive the details of the dispute via the ODR platform.

➢  The ODR platform will be connected to the national ADR entities set up and notified to the Commission, in line with the new rules of the ADR Directive.

IS THE OUTCOME BINDING?

It depends on the nature of the ADR entities chosen by the parties.

In the future?

•       BINDING OUTCOME

•       B2B

The platform will help speed up the resolution of the dispute by allowing ADR entities to conduct the proceedings online and through electronic means.

A set of common rules will govern the functioning of the ODR platform.

ODR advisors (as national contact point):  they will provide general information on consumer rights and redress in relation to online purchases, assist with the submission of complaints and facilitate communication between the parties and the competent ADR entity through the ODR platform.

All the parties will be electronically linked to the platform.

Moreover, these new rules will provide for ADR entities to settle a dispute within 90 days. 

Simulation: http://ec.europa.eu/consumers/solving_consumer_disputes/docs/adr-odr_for_web.pdf

Věra Jourová, Commissioner for Justice, Consumers and Gender Equality said: "One in three consumers experienced a problem when buying online in the past year. But a quarter of these consumers did not complain – mainly because they thought the procedure was too long or they were unlikely to get a solution. The new online platform will save time and money for consumers and traders. I am confident the platform will be widely used to solve consumer grievances". (Official press release on ODR Platform)

It is estimated that if EU consumers can rely on well-functioning and transparent ADR for their disputes they could save around €22.5 billion a year.[www.europa.eu/rapid/press-release_MEMO-13-193_en.htm]

US SYSTEM

•       NO uniform legislation

•       Self regulation and guidelines are the approaches recommended by the American Bar Association (ABA)

•       The modules of ABA are the most used in ADR schemes

•       In 2010 The International Center for Dispute Resolutions (ICDR) introduced manufacturer/supplier on line dispute resolution protocol (negotiation + arbitration)

•       Circuit courts providing eFiling services

ODR METHOD

•       Fully Automated Cyber-Negotiation: services entirely online and focus primarily on negotiating monetary settlements

•       Cyber-Mediation Using Sophisticated Software and a Neutral Third Party Facilitator

•       Traditional Mediation Using Online Technologies

PRO

•       Cost saving and convenience

•       Avoidance of complex jurisdiction issues

CONS

•       Limited range of disputes

•       Impersonal

•       Not accessible to everybody

•       Data protection issue

SOME EXAMPLES

SquareTrade eBay’s preferred dispute resolution provider

It offers 2 services:

-          a free web-based forum

-          the use of a professional mediator (15 USD)

1) FREE ODR

To start the process

•       Create a SquareTrade User ID and password

•       Enter complaint details.

SquareTrade will send a notification email to the other party who can then respond.

The complaint and the other party’s response will appear in a secure area on the SquareTrade Web site. Only the parties will be granted access.

2) WITH PROFESSIONAL MEDIATOR

The mediator works to understand both points of view and to help develop a fair, agreeable settlement. If a resolution can’t be reached, the mediator will recommend a solution based on principles of fairness and good conduct.

This process generally takes 10 days. 

Resolution Center for hosts and guests

No external provider

1)      On line Conciliation: trying to find a solution. – Filing a request on the resolution center (no mediator involved)

2)      NO agreement ? NO answer? option to involve Airbnb 72 hours after user open his request.

Airbnb will make a final decision based on Airbnb policies

The decision will be considered as “final” for Airbnb

Uniform Domain-Name Dispute-Resolution Policy

(often referred to as the "UDRP”)

Trademark-based domain-name disputes

must be resolved by agreement, court action, or arbitration before a registrar will cancel, suspend, or transfer a domain name.

Disputes alleged to arise from abusive registrations of domain names (for example, cybersquatting) may be addressed by expedited administrative proceedings that the holder of trademark rights initiates by filing a complaint with an approved dispute-resolution service provider. 

To invoke the policy, a trademark owner should either (a) file a complaint in a court of proper jurisdiction against the domain-name holder (or where appropriate an in-rem action concerning the domain name) or (b) in cases of abusive registration submit a complaint to an approved dispute-resolution service provider.