The Odour (ODR) of Online Sales

The Odour (ODR) of Online Sales

Published: 27 February 2016

The European Commission has established an online dispute resolution platform (ODR) to enable a consumer of goods or services bought online in the EU, to submit a complaint form online, to a business based anywhere in the EU. The complaint can then be dealt with by alternative dispute resolution (ADR).  It is a new requirement for traders of online sales or service contract in all sectors to participate with ODR, with a few exceptions.  The advantage of this is that ADR is intended to be cheaper and quicker than court action.

Business Requirements

Where a trader does business online, whether through a website, online marketplace (e.g. eBay) or other electronic means, that trader must provide an easily accessible electronic link to the ODR platform website. In addition, all online traders must state their email address there (an online contact form that does not show an email address is not enough).

Where a trader is required to use an approved ADR provider (whether by law, by trade association membership or by contract) it must also give additional information to consumers.  Not only must they link to the ODR platform on their website, they must also inform consumers of the existence of the ODR platform and the possibility of using the platform to resolve disputes.  If an offer is made to a consumer by email, that email must contain a link to the ODR platform.  A trader must include this information in any standard terms and conditions of business for online sales and services contracts.

All approved ADR providers are capable of handling disputes filed through the ODR platform. This means that, when a consumer files a dispute through the ODR platform, the platform will identify a suitable ADR provider for their dispute. ADR will then go ahead so long as the trader and the ADR provider agree to it. For the trader, ADR will often be the best way to deal with a dispute, but it is not compulsory.

If a trader fails to comply with the information requirements, Trading Standards can apply for a court order requiring compliance.  If the order is not complied with, directors and companies might expect the maximum penalty which is an unlimited fine and two years' imprisonment.

While the ODR is free to use, it is important to note that some dispute resolution bodies might charge a fee.

Consumers

Once a consumer chooses to complain through the ODR, they can submit their complaint immediately.  But if the complaint is saved as a draft, then a consumer has only 6 months to submit it.  After that, all drafts will be automatically deleted.

Once the trader has agreed to use the dispute resolution procedure to address the complaint, it can send the consumer, via the system, the name(s) of one or more dispute resolution bodies able to deal with it.  The consumer can select only one dispute resolution body from the list sent to it by the trader.

The trader has 10 days to reply to the ODR complaint. If a consumer does not receive a reply within 10 days, they can contact a national contact point to try to get a reply.  Consumers have 30 days after submitting their complaint to agree with the trader on a dispute resolution body.  After that, the complaint will not be processed further.

ADR nearly everywhere

This new law follows the requirement that all traders – not only online traders - selling to consumers must provide consumers with details of a sector relevant certified ADR provider and inform the consumer whether they intended to use ADR.  Although traders do not have to agree to use ADR for a consumer dispute (unless it is compulsory for them by law, by scheme membership or by contract), they are required to provide certain information about ADR to consumers. Please note that these rules does not apply to health professionals.

Regardless of the date of the dispute or contract, at the point where the trader's internal complaint-handling procedure is exhausted, it must provide the consumer with a statement that the trader cannot settle the complaint and the name and website address of an ADR provider, and say whether the trader is obliged or prepared to submit to the ADR. This information must be provided in an email or other durable medium.

In addition, where a trader is subject to compulsory ADR either by law or a trade association, it must provide the name and website address of the ADR provider on its website (if it has one) and as part of its general contract terms.

If you would like further information on the new rules or need help drafting new terms and conditions please contact  Piers Larbey  or Tudor Alexander in our Corporate Team.

 

The contents of this article are intended for general information purposes only and shall not be deemed to be, or constitute legal advice. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of this article.