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What should the ideal ODR system for consumers look like?

What should the ideal ODR system for consumers look like?. Dr Julia Hörnle CCLS, Queen Mary, University of London j.hornle@qmul.ac.uk. Two main messages. Two obstacles-one compromise: enforcability of consumer arbitration vs higher due process

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What should the ideal ODR system for consumers look like?

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  1. What should the ideal ODR system for consumers look like? Dr Julia Hörnle CCLS, Queen Mary, University of London j.hornle@qmul.ac.uk

  2. Two main messages • Two obstacles-one compromise: enforcability of consumer arbitration vs higher due process • Complex puzzle with many jigsaw pieces, but funding-> spreading of the risk

  3. The continuum: mediation & arbitration • A skilled mediator can settle a significant percentage of disputes • But not all disputes lend themselves to a compromise • Mediation in the shadow of the law -> in the shadow of binding dispute resolution? • Mediation is an (important) filter, not an alternative

  4. Fairness • Principle of party autonomy and waiver of some rights • Commercial arbitration subject to lower due process standards • Confidentiality • Exacerbating power imbalances • Consumer arbitration must comply with ‘higher’ due process standards than traditional arbitration • Balance between efficiency and fairness

  5. Enhanced due process • Applying the weaker party’s mandatory laws • Independence and impartiality of the arbitrator • Independence of the institution • (Proportionate) fair hearing • Reasons for decisions and transparency • Limited judicial review/appeal??

  6. How to get an arbitration agreement (pre-dispute)? • EU/EEA Unfair Contract Terms Directive 1993/13/EC • Black List to proposed Draft Consumer Rights Directive Annex II (c) COM (2008)/614 (3) • English law, not binding if amount in dispute less than £5000 • US state laws, some courts finding clause unconscionable

  7. How to bring the parties to arbitration?? • Post dispute? Encouragement/Compulsion • Platform, marketplace • Payment provider referral, escrow • National enforcers, consumer protection agencies? • LEGAL OBLIGATION? • TRUST MARK • NAME AND SHAME (for example on consumer advice website) • Examples in communications and financial sector (licensing) • Domain Name Registrars & ICANN? • Still an ‘arbitration agreement ‘ under the NYC?

  8. How to bring the parties to arbitration?? • Asymmetrical obligation? Consumer can choose between arbitration and litigation? • But once chosen award is binding • Who is a consumer? • How to define a power imbalance? • Combine notice & take down with arbitration for hosted content?- a new model for immunity for hosting?

  9. Enforcement • Enforcement of an arbitration award through the courts- cross-border enforcement! • Award based on a ‘compulsory’ arbitration agreement enforceable under the NYC? • New Convention/Regional treaties? • Extra-legal enforcement • Same methods as mentioned above: exclusion from marketplace, trust mark, name & shame • Problematic?- UDRP compromise?

  10. Who pays? • Concept of proportionate dispute resolution • De minimis? Not all consumer disputes can be solved through private redress; need for public enforcement to address wide-spread small harm • Conflict between independence of provider and payment • Public subsidy required? • Insurance, licence fees? • Both parties should pay towards the cost

  11. The puzzle... • And its jigsaw pieces.... • Non-binding forms of ADR • Payment reverse mechanisms • Insurance? • Online arbitration (but de minimis) • Due process standards • Training of arbitrators • National ombudsman/arbitration schemes, networked through a clearing house system • Legal and extra-legal enforcement • New Convention? • Litigation

  12. The book to the film.... • “Cross-border Internet Dispute Resolution” published by Cambridge University Press, 2009

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