ADR Directive - Delay to Information Requirements!

Full details of ProMediate's consumer dispute resolution scheme can now be found at

https://www.promediate.co.uk/click2resolve/

One Rule for Lawyers and One Rule For Others

Perhaps inevitably, the government has announced that businesses with a voluntary or trade body scheme will have more time to comply with the information requirements under the Alternative Dispute Resolution Directive.  Those businesses will now have until 1 October 2015 to amend their terms and conditions.  We understand that other businesses will have to notify customers of a certified ADR Provider after 1 October 2015, in "durable form".  I was recently informed by the Law Society that Solicitors had been given until 1 November to comply, as they need to publish details of the Legal Ombudsman in their terms and conditions and on their websites.  In fact, this turned out to be incorrect information.  Solicitors still need to comply by 1 October.

BIS issued guidance on 22 June 2015.  We would recommend including a Certified ADR Provider in all businesses' terms and conditions and on their websites, particularly if making online sales, as the ODR Directive comes into affect from 9 January 2016.

The delay does not surprise me as there has been little publicity regarding the Directive and businesses appear reluctant to implement it.  However, the delay for solicitors would have surprised me considerably as of all people, lawyers should know about the law and should set a good example in relation to compliance.  They should not have difficulties in amending their terms and conditions.  This delay would have meant that their clients had to comply by 1 October and they would not have to comply until 1 November, which would have been "one rule for lawyers and one rule for others."  Happily, this is not the case.

However, the Legal Ombudsman has announced that it is applying to be an authorised body under the directive and will be consulting on changing its rules to allow for indefinite time for clients to complain.  If this change is introduced, firms will have to keep their files indefinitely in order to deal with complaints.  The Legal Ombudsman is saying that this change will be delayed until January 2016 so that it can consult, so it remains to be seen whether this provision is introduced as there is likely to be a backlash.

The directive obliges all businesses which cannot resolve a complaint with the consumer and who have exhausted their own internal complaints handling process, to give the consumer details of a certified ADR Provide and indicate whether or not they intend to use them to try and settle the dispute.

BIS sees several benefits in delaying the business information requirements until 01 October;

1. Bringing them into force on 1 October will align with the common commencement date which is also the same day that comprehensive changes to consumer law are being introduced by the Consumer Rights Act:  This will make it clearer for consumers and traders as all the main changes to consumer law will all come into force on the same day. 

2. Competent authorities will have more time to certify ADR providers: Whilst on track to certify most ADR providers seeking certification by 9th July, there may be some who are not certified on time so the delay will mean certified ADR providers will not have a competitive advantage over those still waiting. 

3. There will be more time for business to familiarise themselves with their obligations.

Moving the Goalposts Again

This development will be welcomed by business, but the ADR providers who have invested in the process and applied early will be disappointed.  Consumers will also be unable to obtain information about ADR and a business' approach to it, which could save them money, for 3 months.  This does not bode well for the implementation of the ODR Regulations which provide for an EU Online Dispute Resolution Platform to be up and running by 1 January 2016.  There has already been an about turn in the process when the government announced that it was not going ahead with the residual ADR scheme.  What next?

Disclaimer: The information and any commentary on the law contained in this article is for information purposes only. No responsibility for the accuracy and correctness of the information and commentary or for any consequences of relying on it, is assumed by the author. The information and commentary does not, and is not intended to amount to legal advice to any person on a specific case or matter. The article was written on the date shown and may not represent the law as it stands subsequently. For the avoidance of doubt, the views in this article are personal to the author and not attributable to any other individual or organisation.