The OECD, the European Commission and different countries are considering ways to improve dispute resolution and redress mechanisms, for example with the help of collective procedures. This is considered essential to increase consumer confidence.
In June the OECD issued a Recommendation on Consumer Dispute Resolution and Redress to deal with issues arising from the rapid growth in electronic commerce. If consumers are to be encouraged to make cross-border purchases, they need to have confidence that claims will be settled in a fair and effective manner.
The recommendation sets out a framework that covers disputes in both domestic and cross-border transactions. In preparing the recommendation special attention was paid to distance selling and online transactions, but the principles can also be applied to offline trade.
Electronic commerce has not grown as fast as could have been expected, and studies have shown that one key reason is consumers' concerns about whether they can obtain redress if they are unsatisfied with their purchase, because of a defect or delay in delivery, for example, and how to obtain help in such situations.
The recommendation provides a practical approach to address these concerns in a systematic and comprehensive way. Many member countries are also paying increased attention to dispute resolution and redress mechanisms, and in particular collective action mechanisms. The recommendation focuses on five priority areas: identifying basic elements needed for effective domestic resolution and redress frameworks, improving resolution of cross-border disputes, enhancing the scope and effectiveness of private sector initiatives to resolve disputes, developing information for monitoring developments and trends in consumer complaints, and improving consumer and business education and awareness on ways to avoid and handle disputes.
The recommendation builds on the previous 1999 OECD Guidelines for Consumer Protection in the Context of Electronic Commerce and the 2003 OECD Guidelines for Protecting Consumers from Fraudulent and Deceptive Commercial Practices Across Borders. These emphasized the importance of providing consumers with effective mechanisms to resolve disputes and called for the further development of such mechanisms, specifically for cross-border trade.
Commission report compares practices in different countries
The European Commission has also prepared or is preparing studies on procedures to ensure that consumers can obtain redress in real life. In January it published a report entitled "An analysis and evaluation of alternative means of consumer redress other than redress through ordinary judicial proceedings". This report summarizes and compares practices in 28 countries, including Australia, the USA and Canada as well as 25 member states.
OECD Recommendation on Consumer Dispute Resolution and Redress
The OECD Guidelines for Protecting Consumers from Fraudulent and Deceptive Commercial Practices Across Borders
OECD Guidelines for Consumer Protection in the Context of Electronic Commerce
An analysis and evaluation of alternative means of consumer redress other than redress through ordinary judicial proceedings