SEMINAR ON OUT-OF-COURT DISPUTES RESOLUTION OF CONSUMER DISPUTES Belgrade, 27 th and 28 th June 2013 Sava Centar

SEMINAR ON OUT-OF-COURT DISPUTES RESOLUTION OF CONSUMER DISPUTES Belgrade, 27 th and 28 th June 2013 Avenues and barriers to consumer redress Prof. Thierry Bourgoignie IPA Project team leader and Key legal expert 2

SEMINAR ON OUT-OF-COURT DISPUTES RESOLUTION OF CONSUMER DISPUTES Belgrade, 27 th and 28 th June 2013 Enforcement as a priority The perception by consumers that the LCP is enforced swiftly acts as a driver for increasing consumer confidence, preventing consumer frustration and as a deterrent to traders seeking to evade consumer protection rules. 3

SEMINAR ON OUT-OF-COURT DISPUTES RESOLUTION OF CONSUMER DISPUTES Belgrade, 27 th and 28 th June 2013 Barriers to access-to-justice 1.Awareness deficit 2.Information/legal advice deficit 3.Obstacles to judicial redress or access to courts 4

SEMINAR ON OUT-OF-COURT DISPUTES RESOLUTION OF CONSUMER DISPUTES Belgrade, 27 th and 28 th June 2013 Barriers to access-to-justice 3. Obstacles to judicial redress or access to courts 3.1. Contract terms depriving or discouraging the consumer from going to court = void as being unfair Psychological/cultural obstacles, i.e. courts perceived as distant from consumer needs, not interested in ealing with small claims, not neutral. 5

SEMINAR ON OUT-OF-COURT DISPUTES RESOLUTION OF CONSUMER DISPUTES Belgrade, 27 th and 28 th June 2013 Barriers to access-to-justice 3.3. Formalism and time; repeat players (trader) vs. one- shot litigant (consumer) Cost, i.e. lawyer’s fees, court/procedural fees, expertise-related costs. For small claims, costs are likely to exceed gains or benefits. 6

SEMINAR ON OUT-OF-COURT DISPUTES RESOLUTION OF CONSUMER DISPUTES Belgrade, 27 th and 28 th June 2013 Barriers to access-to-justice 3.5. Limits to legal standing: Individual interest vs. Collective interest approach No legal standing to the competent market monitoring/surveillance authority to submit cases before civil courts. Limited legal standing to COs (LCP, Art.137). 7

SEMINAR ON OUT-OF-COURT DISPUTES RESOLUTION OF CONSUMER DISPUTES Belgrade, 27 th and 28 th June 2013 Barriers to access-to-justice 3.6. Lack of expertise of judges in consumer protection matters All above deficits and obstacles are even more actual when cross-border cases are at stake + 2 additional and complex issues: Choice of competent court Choice of applicable law 8

SEMINAR ON OUT-OF-COURT DISPUTES RESOLUTION OF CONSUMER DISPUTES Belgrade, 27 th and 28 th June 2013 Plurality of enforcement mechanisms 1.Interplay between public enforcement and private enforcement tools: Public, i.e. prosecutors and market surveillance body(ies): adequate market monitoring, adequate sanctions including injunctions and means of collective redress. Private, i.e. individual consumers and Cos: adequate consumer remedies, including injunctions and means of collective redress. 9

SEMINAR ON OUT-OF-COURT DISPUTES RESOLUTION OF CONSUMER DISPUTES Belgrade, 27 th and 28 th June 2013 Plurality of enforcement mechanisms 2. Interplay between mandatory/binding and voluntary/non-binding tools: Mandatory/Binding: court decisions and arbitration sentences are binding on the parties. Voluntary/Non-binding: use of ADRs schemes remain voluntary; results of direct negotiation, conciliation attempt or mediation is not binding. 10

SEMINAR ON OUT-OF-COURT DISPUTES RESOLUTION OF CONSUMER DISPUTES Belgrade, 27 th and 28 th June 2013 The need to admit a wide range of enforcement mechanisms  Raising consumer awareness about their rights (IPA project)  Developing a newtwork of legal advice centers (MFITT, COs)  Simplifying judicial redress for small claims and/or consumer disputes (Law on Civil Procedure, new chapters XXXIII and XXXV). 11

SEMINAR ON OUT-OF-COURT DISPUTES RESOLUTION OF CONSUMER DISPUTES Belgrade, 27 th and 28 th June 2013 The need to admit a wide range of enforcement mechanisms  Broadening the scope of injunctions under the LCP  Granting to COs and competent market surveillance body the right to seek compensation for the damage caused to the collective interest of consumers.  Promoting non-judicial means of consumer redress. = ADRs and ODRs. 12

SEMINAR ON OUT-OF-COURT DISPUTES RESOLUTION OF CONSUMER DISPUTES Belgrade, 27 th and 28 th June 2013 Out-of-court disputes resolution of consumer disputes in EU member States  ADR schemes have emerged in all member States.  Countries with a more developed consensus culture are usually more advanced: e.g., Scandinavian countries, The Netherlands, Austria, Uk vs. France. 13

SEMINAR ON OUT-OF-COURT DISPUTES RESOLUTION OF CONSUMER DISPUTES Belgrade, 27 th and 28 th June 2013 Out-of-court disputes resolution of consumer disputes in EU member States  There is a multitude of operating schemes: direct negotiation, mediation, arbitration, mixed scheme. Administrative system (Scandinavian countries) vs Collective bargaining among private stakeholders (The Netherlands). One-sided (Consumer call center) vs two-sided initiative.  Every state has its own mix – No ADR system. 14

SEMINAR ON OUT-OF-COURT DISPUTES RESOLUTION OF CONSUMER DISPUTES Belgrade, 27 th and 28 th June 2013 Need to inform the consumer about the availability, conditions for access, nature, rules, cost and legal effect of the proposed scheme. Need to ensure that the scheme is Fair justice calls for a network of ADRs schemes throughout the country. = definition of common standards for the operation of ADR schemes = purpose of this seminar. 15

SEMINAR ON OUT-OF-COURT DISPUTES RESOLUTION OF CONSUMER DISPUTES Belgrade, 27 th and 28 th June 2013 Agenda of this seminar Stage 1: EU response to the need for out-of-court resolution of consumer disputes: promoting ADRs, setting common standards, regulating ODRs. Stage 2: Experiences with out-of-court resolution of consumer disputes in Serbia: concepts and practice. Stage 3: ODRs Stage 4: IPA Project proposals regarding ADRs and ODRs in Serbia. 16