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Commission welcomes agreement on simplified out-of-court dispute resolution for consumers

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The European Commission welcomes the political agreement reached by the European Parliament and the Council on the Commission proposal for a revised Alternative Dispute Resolution (ADR) Directive.

The new legislation simplifies and modernises the out-of-court resolution of disputes between businesses and consumers in the European Union, adapting them to digital markets and further reinforcing EU consumer protection. Previously, the Directive was limited to contractual disputes between EU consumers and EU traders. Now its scope is extended to cover disputes related to pre-contractual obligations, digital content and services, as well as non-monetary contracts. It now also encompasses non-EU traders willing to engage in ADR procedures. The new requirement for traders to reply to ADR inquiries within 20 days will incentivise businesses to engage with consumers in out-of-court resolution procedures. The new ADR contact points established across member states will further assist consumers in the process of navigating cross-border dispute resolutions.

Tech Sovereignty, Security, and Democracy Executive Vice President Henna Virkkunen said: “The agreement reached yesterday will strengthen the rights of consumers for the digital era, while fostering market trust. Out-of-court dispute resolution is a powerful, cost-efficient tool that is now improved for the benefit of all.”

Democracy, Justice, the Rule of Law, and Consumer Protection Commissioner Michael McGrath (pictured) said: “Yesterday's agreement is a positive step for consumers. Out-of-court dispute resolution empowers consumers with a fast, fair and affordable way to stand up for their rights without being discouraged by long and costly judicial procedures. The revised Directive brings the system in line with today's digital economy – making justice more accessible for everyone.” 

The next step is for the European Parliament and the Council to formally adopt the Directive. The directive will start to apply 32 months after its entry into force. More information can be found here.

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