EU Council - Consumer protection: updated alternative dispute resolution directive

The Council has given its final approval to a directive that updates, simplifies, and enhances the existing alternative dispute resolution (ADR) framework. The legal text aims to make ADR a more accessible and more appealing option for resolving disputes arising from contractual agreements, including issues related to precontractual obligations. It will make the ADR framework fit to digital markets, enhance the use of ADR in cross-border disputes and simplify ADR procedures to the benefit of all actors. Additionally, the proposal will rationalise reporting obligations and reduce administrative burden.

Subject to certain conditions, ADR will now also be available for disputes between EU-based consumers and traders from third countries. Furthermore, traders will have a duty to reply within 20 days after being contacted by an ADR entity, and failure to do so will be considered a refusal to participate in the process. The new directive requires member states to promote ADR participation for traders and consumers, and to put particular emphasis on sectors with low participation in ADR or with a high volume of consumer complaints.

The approval of the first-reading position is the final step in the Council's adoption process. However, the text still needs to be approved in a plenary session of the European Parliament. Once adopted, the directive will take effect 20 days after its publication in the Official Journal. Member states will then have 26 months to incorporate the new rules into their national laws, and the rules will apply 32 months after the directive is published in the Official Journal.