MPs on Tuesday began reviewing legislation aimed at affording further protection to consumers through the creation and operation of alternative dispute resolution bodies.
The government bill is aimed to transpose into national law the EU’s Alternative Dispute Resolution (ADR) Directive.
In 2015, Cyprus passed a harmonising law, but the EU subsequently found that the law veered from the spirit and letter of the directive. The Commission duly notified Cyprus of this in February 2016.
The new bill, which once enacted will repeal and replace the existing law, affords consumers the possibility to lodge complaints against traders.
Complaints will be lodged with bodies which are required to provide independent, objective, transparent, effective and swift dispute resolution procedures.
The bill includes a clause whereby the competent authority may impose an administrative fine of up to €10,000 on a trader.
The dispute resolution bodies to be set up are obliged to publish on their websites annual activity reports, highlighting among others systemic and/or major recurring issues that lead to disputes between consumers and traders.
At the House commerce committee, consumer protection associations welcomed the legislation but said it needed to ensure that traders against whom complaints are lodged must be present during the mediation process.
The ADR Directive ensures that consumers have access to ADR for resolving their contractual disputes with traders.
Access to ADR is ensured no matter what product or service purchased (only disputes regarding health and higher education are excluded), whether the product or service was purchased online or offline and whether the trader is established in the consumer’s Member State or in another one.
This Directive also established binding quality requirements for dispute resolution bodies offering ADR procedure to consumers. Member States’ competent authorities, after their assessment, communicate to the European Commission the list of national dispute resolution bodies.