The government is to look further into simplifying the system of alternative dispute resolution for consumers.
Responding to a consultation on a European ADR directive, which it has to transpose into national law by 9 July 2015, the Department for Business Innovation & Skills (BIS) said the current ADR landscape in the UK was ‘complex’.
With more than 70 different ADR schemes operated by a range of providers, the department said some consumers find their dispute may be covered by multiple providers and it is not always clear who to go to for help.
While it recognised the advantages of a simplified ADR system - which could mean a single consumer ombudsman, rationalisation of schemes or an umbrella ADR body - BIS said there were still significant issues to consider when determining the best approach.
As a result, it proposed to continue to consult with stakeholders, and carry out further work to assess the costs and benefits of making any structural changes.
Under the Directive on Alternative Dispute Resolution (2013/11/EU), the government is required to ensure that ADR, provided by a certified ADR body, is available for any dispute concerning contractual obligations between a consumer and a business – though the use of ADR would not be mandatory.
Looking beyond the requirements of the directive, although existing arrangements for accessing ADR were ‘insufficient’, the department said a blanket obligation on businesses to use ADR was ‘not appropriate at this time’.
It proposed appointing the Legal Services Board as a ‘competent authority’ for ADR in regulated legal services in England and Wales – one of nine sector-specific competent authorities that would assess whether bodies wishing to qualify as a certified ADR provider met the requirements of the directive, and monitor their performance.
Other proposals include:
- Providing additional funding to Citizens Advice to extend its existing consumer advice service to provide a consumer complaints helpdesk function, and advise and assist on ADR;
- Not categorising in-house mediation as an appropriate ADR process;
- Applying an eight-week extension to the six-year window an individual has to initiate litigation, should an ADR process be ongoing at the time the window closes.
As well as the directive, an online dispute resolution regulation will come into force automatically on 9 January 2016, although requirements relating to the creation of an online ODR contact point will apply in advance.
Jo Swinson, minister for employment relations and consumer affairs, said: 'ADR offers a quick and cheaper alternative to the court system, when disputes cannot be resolved between the consumer and the business directly.
’The greater availability of ADR will strengthen consumer protection and improve consumer confidence.’