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Building Trust:Building Trust: Consumer Dispute Resolution Consumer Dispute Resolution (B2C)(B2C)
Louise Sylvan
Consumers International
Consumers InternationalConsumers International
Global federation of 263 independent consumer organisations in 119 countries
Eg. Developed countries: Brand names– Consumer Reports (US)– Consumentengids (Netherlands)– Tests-Achats (Belgium)– Which? (UK) – CHOICE (Australia) ……
KEY CONFIDENCE ISSUESKEY CONFIDENCE ISSUES
Novel Shopping– New requirements, new fraud opportunities
PrivacySecurityAuthentication Redress
RedressRedress
Consumers International study on providers of ADR online – released today– Follows on from consumers@shopping– 8 key criteria for assessment of providers– Major deficiencies/areas for improvement– Conclusions and Recommendations
Online ADR ProvidersOnline ADR Providers 1-2-3 Settle.com AllSettle.com BBB Online clickNsettle.com Cybercourt Cybersettle E-Mediator eResolution iCourthouse iLevel Internet Neutral Internet Ombudsman Mars NewCourtCity.com NovaForum.com
ODR.NL Online Resolution Online Ombuds Office OnLine Disputes Resolution Forum SettleOnline SettleSmart SquareTrade The Virtual Magistrate U.S. Settle WebAssured.com Web Dispute Resolutions WEBdispute.com Webmediate Web Trader
What makes for a good What makes for a good dispute resolution process?dispute resolution process?
Lots of experience offline in ADR– Needs co-operation between parties– Can be complaints assistance, mediation,
arbitration
Online adds additional dimensions– Some efficiency (eg. Geographically)– Some innovation (automatic)
What makes for a good What makes for a good dispute resolution process?dispute resolution process?
First, the firm has a good complaints handling, money-back guarantees, etc
ADR comes after the firm and the consumer can’t agree
What makes for effective What makes for effective dispute resolution?dispute resolution?
8 key principles– Based on EU and TACD; GBDe
1. Independence/Impartiality– Of the provider– Of the officials handling disputes
Raises issues of:– Consumer representation, balance– Funding by business
What makes for effective What makes for effective dispute resolution?dispute resolution?
2. Transparency– Up front disclosure of process and procedures– Publication of general statistics– Publication of arbitration results – critical
What makes for effective What makes for effective dispute resolution?dispute resolution?
3. Availability– Geographically– Range of languages
4. Affordability– Preferably free to consumer, or very low fees
What makes for effective What makes for effective dispute resolution?dispute resolution?
5. Effectiveness– Visibility, easy to find– Timeliness– Competence of officers– Ease of use– Enforceable – arbitration binding on the
business – Subject to oversight
What makes for effective What makes for effective dispute resolution?dispute resolution?
6. Fair: Due Process– Both parties heard– No need for (prohibition of) legal representation
7. Legality/Liberty– Voluntary– Does not limit rights nor displace law enforcement
actions– Decisions binding on trader not consumer
What makes for effective What makes for effective dispute resolution?dispute resolution?
8. Oversight (third party)– Problem of inherent bias towards the paying
party – most schemes, it’s business paying– No market forces operating in terms of
consumer choice – choice of ADR by business– Standards established and adhered to through
audited third party process not self declaration
Results - Results - Consumers International Consumers International Initial Study of ADR-onlineInitial Study of ADR-online
Overview assessments of online ADR providers – no grading this time
30 providers 25 North American, 5 Europeanoffering 36 distinct services
– Few designed specifically for consumers
23 for profit companies
Results - Results - Consumers International Consumers International Initial Study of ADR-onlineInitial Study of ADR-online
None met all criteriaGenerally well described proceduresToo little attention to language - EnglishFew assisted with unco-operative merchantsNone of the business providers balanced
their governance structures – consumer and business representation
Results - Results - Consumers International Consumers International Initial Study of ADR-onlineInitial Study of ADR-online
Many limited their applicabilityMost were disproportionately costly Few reported well or transparentlyMost were visible (easy to find), timely and
easy to use
Conclusions & Conclusions & RecommendationsRecommendations
Good online ADR should help reduce likelihood of needing court system
Doesn’t solve applicable law or forumADR suffering same problem as plethora of
seal programs – too messy, too unsupervised for consumer trust to build, most still not meeting essential standards
Conclusions & Conclusions & RecommendationsRecommendations
Too little consideration of type offered – eg. inappropriateness of mediation for many B2C disputes; more thought for consumer designed services
Serious enforcement problems – “No Teeth”– should probably be linked to government ADR or
trustmark with promise of compensation or money back– Trustmark at least provides minimum Code of Practice
and a sanction (dismissal)
Conclusions & Conclusions & RecommendationsRecommendations
Catering for non-English speakers essentialCosts can’t be higher than most B2C
disputesConsideration of balanced governance
needed - credibilityBetter transparency and reporting – not
business “protection” services
Conclusions & Conclusions & RecommendationsRecommendations
Inappropriate “mandatory” ADR and “binding” clauses need to be eliminated
Global standards needed Ongoing independent oversight needed for
trust to build