What should the ideal ODR system for consumers look like?

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