Commission recommendation on the principles applicable to the bodies responsible for out-of-court settlement of consumer disputes
Date: 1998-03-30
Institutions: European Commission
Subjects: access to the courts, civil proceedings, consumer protection, consumption, mediator

COMMISSION OF THE EUROPEAN COMMUNITIES 

CORRIGENDUM 
Rediffusion  du document 
SEC(l998) 576 final du  30.03.1998 
car la cote de ce document doit 
se lire COM(1998) 198 final. 

(concerne toutes les versions  linguistiques) 

Brussels, 30.03.1998 
COM(1998)  198 final 

Communication from the Commission 

"the out-of-court settlement of consumer disputes" 

on 

and 

t?*: 

P 

Commission  recommendation 

on the principles applicable to the bodies responsible for out-
of-court settlement of consumer disputes 

SUMMARY 

This  Communication  is  part  of  a  series  of  Community  initiatives  in  the  field  of 
consumer  access to justice that have been developed over the years. 

The  urgent  need  for  Community  action  in  regard  to  the  settlement  of  consumer 
disputes  was  highlighted  and  confirmed  in  the  consultations  on  the  Green  Paper  (1993) 
and  the  Action  Plan  on  "consumer  access  to  justice  and  the  settlement  of  consumer 
disputes in the single market" (1996). 

The outcome  of these discussions  shows that  one of the  paramount  goals  is to  facilitate 
the  settlement  of  consumer  disputes  by  resolving  the  problems  arising  from  the  disparity 
between  the  economic  value  at  stake  and  the  cost  of  its judicial  settlement.  In  order  to 
satisfy  this  objective,  this  Communication  contains  two  features  designed  to  improve 
access to justice for individual consumers!: 

-  a claim form  designed  to  facilitate  communication  between  consumers  and  professionals 
and,  should  an  amicable  solution  prove  impossible,  facilitate  access  to  out-of-court 
procedures and 

-  a Recommendation  laying down the principles applicable to  out-of-court  procedures  for 
the settlement  of consumer disputes2. 

î 

-) 

For  the purposes  of  this  communication  "consumer  access  to justice"  means  the opportunity  to 
exercise one's rights in practice, not access to justice in the stricter sense, i.e. to the courts. 

The first  Community initiatives in the field of consumer access to justice date from the 1980s. A first 
Commission  Communication  on consumer  redress was transmitted  to the Council  in the form  of a 
memorandum on 4 January  1985 (COM(84) 692 final), followed by a supplementary  Communication 
dated 7 May 1987 (COM(87) 210 final. The European Parliament adopted a Resolution on the subject 
on  13 March  1987 (OJ No C 99, 13.4.1987, p. 203). The Council's reaction was to adopt a Resolution 
on 25 June  1987 devoted solely to consumer redress (87/C  176/02, OJ No C 176, 4.7.1987, p. 2), in 
which  it  invited  the  Commission  to supplement  its  analysis  in  view  of  the  enlargement  of the 
Community. 

The Community dimension of the problem of consumers' access to the law was also referred to in the 
European  Parliament's  Resolution  of  11  March  1992 (OJ No C  94,  13.4.1992,  p. 217)  and the 
Council Resolution of 13 July  1992 on future  priorities for the development  of consumer protection 
policy  (OJ  No C  186, 23.7.1992,  p. 1).  On  21-23 May  1992, under  the  aegis  of  the  Council 
Presidency and the Commission, the third European  Conference on consumer  access to justice was 
held  in Lisbon and was  attended by some 300 experts from  the 12 Member States of the European 
Community  and certain  EFTA  countries.  The conclusions  of the meeting  confirmed  the concerns 
expressed in the course of the above-mentioned initiatives. 

In its Green Paper on "Access of consumers to justice and the settlement of consumer disputes in the 
single  market"  (COM(93)  576 final  of  16 November  1993),  the Commission  set out a  number of 
proposals aimed at resolving  individual and collective cross-border disputes. The aspects mentioned 
in the proposals included the free movement of actions for an injunction and the simplified  settlement 
of disputes. 

Following the Green Paper, the Commission  tabled a proposal for a Directive on injunctions for the 
protection of consumers' interests, which is in the process of being adopted (common position of the 
Council on injunctions for the protection of consumers'  interests (EC No 48/97 of 30 October 1997, 
OJ No C 389, 22.12.1997, p. 51) as well as a Communication on an action plan on consumer access 

2 

CONTENTS 

1.  THE  PROBLEM  OF  ACCESS  TO  JUSTICE  FOR  INDIVIDUAL 

CONSUMERS 

2.  THREE APPROACHES TO A SOLUTION: 

a) 

b) 

The simplification  and improvement of court procedures 

improvement  of  communication  between  consumers  and 

The 
professionals 

c) 

The creation of out-of-court  procedures 

I.  THE CONTENT OF THE PROPOSED ACTION 

1.1  Encouragement of amicable settlement of consumer problems 

1.2.  Providing  appropriate  safeguards  in  connection  with  the  creation  and 
operation  of  out-of-court  bodies  responsible  for  resolving  consumer 
disputes 

H.  A EUROPEAN COMPLAINT FORM FOR CONSUMERS 

HI.  COMMISSION  RECOMMENDATION  ON  THE  PRINCIPLES 
APPLICABLE  TO THE BODIES  RESPONSIBLE  FOR  OUT-OF-COURT 
SETTLEMENT OF CONSUMER DISPUTES 

ANNEX. 

INFORMATION FORM ON  THE OUT-OF-COURT  BODIES  RESPONSIBLE 

FOR RESOLVING CONSUMER DISPUTES 

to justice  and  the  settlement  of  consumer  disputes  in  the  internal  market  (COM(96)  13 final of 
14 February  1996). In its Resolution on this Communication  (A4-0355/96, OJ No C 362, 2.12.1996, 
p. 275)  the European  Parliament  gave  its  support  to  the  objectives  set  out  in  the  action  plan  and 
called on the Commission to undertake further work on the subject. 

INTRODUCTION 

l. 

THE PROBLEM OF ACCESS TO JUSTICE  FOR INDIVIDUAL  CONSUMERS 

When  it adopted  the first programme for  a consumer  protection  and  information  policy in 
19753,  the  Council  of  the  European  Communities  enunciated  five  fundamental  rights4. 
Since  then,  Community  law  has  made  substantial  progress  in  this  area.  There  are  now 
several Community texts that  endow consumers with a set of concrete rights which can be 
relied  on  in  all  the  Member  States.  Product  liability,  consumer  credit,  doorstep  selling, 
package  holidays,  overbooking  in  air  transport,  liability  for  air  traffic  accidents5,  unfair 
terms,  contracts  negotiated  at  a  distance,  and  timeshares  -  all  are  now  addressed  in  EC 
law.  Other  texts  have been  proposed  and  are  currently  under  discussion  in  such  areas  as 
the  sale  of consumer  goods  and  associated  guarantees.  Thanks  to  the  adoption  of  these 
rights  at  Community  level,  consumers  can  make  the  most  of  the  large  internal  market, 
which was the objective underlying the Member  States'  decision  to  accept  the Action Plan 
for  a  Single  Market  presented  by  the  Commission  to  the  Amsterdam  European  Council 
(strategic objective 4, CSE(97)  1  final of 4 June  1997). 

The  Member  States,  who  are  primarily  responsible  for  consumer  protection,  have  also 
adopted  on  their  own  initiative  a  multiplicity  of  laws  providing  for  specific  rights  in 
consumers  both  in  domains  not  covered  by  the  Community  texts  and  in  harmonised 
domains  covered  by  Community  provisions  allowing  Member  States  to  ensure  a  higher 
level  of consumer  protection.  Moreover,  in their relations  with  professionals  - even  in the 
absence  of  specific  legislation  -  consumers  enjoy  the  protection  granted  by  the  general 
rules of civil law. 

However,  if substantial  rights  are granted  people without  providing  mechanisms to  ensure 
their  effective  exercise,  these  rights  have  no  practical  value6.  Hence,  in  order  to  ensure 

OJ No C 92, 25.4.1975, pp.  1-16. 

'The right to protection of health and safety, the right to protection of economic interests, the right to 
information  and education, the right to representation, the right to fair compensation for damages in 
the form of rapid, effective  and affordable procedures". 

Council  Regulation  (EC)  No  2027/97  of  9  October  1997  on  air  carrier  liability  in  the  event  of 
accidents, OJ No L 285, 17.10.1997. 

Access to justice, as far  as consumers are concerned, constitutes a corollary of the substantial rights 
conferred  by  the  Community  legal  order.  Although,  in  the  absence  of  Community  regulations, 
Member States have the power to establish the procedures for access to justice which are necessary to 
ensure  that  these rights are fully  safeguarded,  Community  law  nevertheless  imposes  limits  to that 
power. For example, legislation of this type may not discriminate against persons whom Community 
law entitles to equal treatment, and they may not restrict the fundamental  freedoms guaranteed by the 
Treaty.  Since  Community  law  guarantees  free  movement  of  goods  and  services  in  the  common 
market, it is a corollary of those freedoms that operators, including consumers, must be able, in order 
to  resolve  any  disputes  arising  from  their  economic  activities,  to bring  actions  in  the  courts  of a 
Member  State  in  the  same  way  as  nationals  of  that  State  (judgment  of  26 September  1996, Data 
Delecta and Forsberg, C-43/95, ECR 96 /I-4661; judgment of 20 March  1997, Hayes, C-323/95, ECR 
1-171). 

that reality is in step with the consumer protection framework  designed by the Community 
and national  legislators,  consumers  must be able to  assert their rights, whenever they are 
infringed, through access to simple, swift, effective  and inexpensive legal channels. 

The  specific  problems  encountered  by consumers  in  exercising  their rights have  already 
been addressed in several  position statements issued by the competent  institutions.  In real 
life there are a certain number of obstacles facing consumers who are seeking justice in the 
courts. 

Firstly, there is the cost of legal consultation and representation, court fees and the cost of 
expert  opinions  (particularly  as  modern  economies  are  characterised  by  increasingly 
complex  products  and  services,  sometimes  beyond  the judge's  knowledge).  Secondly,  in 
certain  countries  plaintiffs  may have to  pay the  defendant's  costs  if they  lose  their case, 
and in other countries they have to pay their own costs even if they win. Finally,  because 
of the backlog  of cases  pending in certain Member States, long delays may arise before a 
case  is judged.  Besides  these  material  factors,  there  are  also  barriers  of  a  psychological 
order  due  to  the  complexity  and  formalism  associated  with  court  procedures. * And 
consumers are often  reluctant to sue because of their unfamiliarity with legal language and 
the hermetic rituals characteristic of judicial proceedings. 

If things  are complex  enough  in national  disputes,  they are even  more complicated  when 
more than one country is involved.  The risk of getting involved  in a cross-border dispute7 
has been  increasing  with  the  proliferation  of  cross-border  consumer transactions  and the 
development of new selling techniques and services. 

In view of the above it is fair to  say that,  in most  consumer  disputes -  both  national and 
cross-border  -  the  proceedings  are  too  long  drawn  out  and  their  cost  excessive8  when 
compared, with the limited value of the dispute. In these circumstances many consumers do 
not even try to assert their rights and simply allow them to be infringed. 

2. 

THREE APPROACHES TO A SOLUTION: 

There are three possible ways of improving consumer access to justice:  simplification and 
improvement  of  legal  procedures,  improvement  of  communication  between  professionals 
and consumers,  and out-of-court  procedures to  settle  consumer  disputes.  Far from being 
alternatives, these three approaches are fully complementary. 

However,  a fundamental  difference  distinguishes  the first approach  from  the  other two: 
while the first approach remains within the traditional framework  of the judicial  settlement 

7  For a detailed description of the definition  and all the specific or supplementary  problems associated 

with it, see page 72 of the Green Paper. 

This  argument  has  been  verified  and  borne  out  in  the  study  on  the  "Cost  of  legal  barriers  for 
consumers  in the single  market". This study showed that the average cost (court  fees plus  lawyer's 
fees) of the judicial settlement of an intra-Community dispute concerning an amount of ECU 2 000 is 
approximately ECU 2 500 for the plaintiff  even in the best of circumstances. The results of the.study 
are  summarised  in  the  Action  Plan  on  consumer  access  to justice  and  the  settlement  of  consumer 
disputes in the single market, pages 8-11 (COM(96) 0013). 

of disputes and aims to improve the existing systems, the two other remove these  disputes 
from the judicial arena wherever possible. 

a)  The simplification  and  improvement  of court  procedures 

Most  Member  States  have  mounted  initiatives  designed  to  simplify  court  procedures  for 
"small  disputes",  either generally  or  specifically  in regard  to  consumer  disputes.  The  idea 
common to these initiatives  is to  dispense with formalised  procedures  so that the case can 
be  dealt  with  in  a  simplified  manner,  the  involvement  of  a  lawyer  being  optional,  or  to 
have the court itself seek to reach a settlement  (either mandatory or at the discretion of the 
court  or the parties). Despite  some similarities there  are many inter-country  differences  in 
the  simplified  procedures,  especially  in  the  criteria  used  to  define  small  disputes  and  in 
regard to costs. 

In  its  Action  Plan  of  14  February  1996  the  Commission  proposed  creating  a  form, 
designed  to  simplify  consumer  access  to  court  procedures.  However,  the  results  of  the 
subsequent  consultations  showed  that  the  Member  States  had  misgivings  about  the 
benefits  of a single form  in the context of simplified  court  procedures - especially since the 
possibility of initiating such a procedure simply by dispatching a form would mean changes 
to the national  rules of civil  procedure  in most  countries. However,  the work  done  in this 
context  inspired  the  Commission  to  launch  one  of  the  initiatives  in  the  out-of-court 
domain contained  in this Communication  (see section 1.1  below). 

This  Communication  does  not  address  court  procedures  and  therefore  does  not  contain 
proposals  referring  to  this  primordial  domain.  Of  course,  this  does  not  mean  the 
Commission  has  opted  not  to  encourage  progress  in the  matter  of  court  procedures.  On 
the  contrary,  it  will  continue  to  study  the  need  for  common  action  and  the  form  such 
action  should  take  with  regard  to  the  operation  of  court  procedures  in  the  global 
framework  of  the  internal  market  and  the  European  legal  area,  in  which  connection  its 
efforts  will receive a considerable boost  from  the Amsterdam  Treaty. It has also  presented 
a Communication9  the main  intent  of which is to  improve  procedures  for  the  enforcement 
of  court  decisions  abroad  and  rules  on  determination  of  the  courts  empowered  to  hear 
cross-border  disputes.  This  Communication,  which  takes  account  of  consumer  interests, 
also  opens  up  a debate  on  a common  EU  approach  as  regards  certain  aspects  of  national 
procedural  law.  Moreover,  a  broader  debate  will  be  launched  on  the  operation  of 
simplified  court procedures (for  small disputes) in the context  of the European legal area. 

b)  The  improvement  of communication  between  consumers  and  professionals 

In  order  to  counter  the  problems  of  consumer  access  to  justice  before  the  courts,  the 
objective  is  to  help  consumers  find  an  amicable  solution  to  their  disputes  with  the 
professional.  Dialogue  between  the two  parties  and  an  amicable  settlement  of the  dispute 
mean  that  consumers  can  avoid  all  the  problems  associated  with  going  to  court,  while 
putting right the situation  created by any infringement  of their rights. 

Communication from  the Commission to the Council and the European Parliament "Towards greater 
efficiency  in  obtaining  and  enforcing  judgments  in  the  European  Union"  (COM(97) 609  final,  of 
26.11.1997). 

The amicable resolution  of disputes is  also  in the interest  of professionals  who,  for their 
part, are keen to avoid litigation and to retain their clients. 

Normally  the  dialogue  takes place  at the  consumer's  own  initiative,  with  or without  the 
involvement of consumer associations or other bodies whose mission is to help consumers. 

However, fruitful  communication is obstructed through lack of consumer information, the 
problems consumers have in formulating their complaints clearly and, in the case of cross-
border disputes,  their reluctance to  initiate  a dialogue  with  someone  in a language  other 
than their own. 

Obviously,  if an amicable  solution  proves  impossible,  there  is  nô  alternative  but  to  have 
recourse to the bodies responsible for resolving consumer disputes. 

The Commission has also launched an initiative in the field of financial  services10, intended 
to  allow  the  parties  concerned,  i.e.  the  financial  services  industry  and  consumer 
organisations,  to  reach  voluntary  agreements  with  a  view  to  improving  consumer 
information and access for consumers to redress procedures. 

c)  The creation  of out-of-court  procedures 

Hence  numerous  initiatives  in  various  Member  States  have  opted  for  out-of-court 
solutions  for  the  settlement  of  consumer  disputes.  The  European  Commission  has  long 
supported  "pilot  projects" at  national  or  local  level  designed  to  put  in  place  or  develop 
systems of this kind. 

In  addition  to  court  procedures,  a  whole  range  of  "out-of-court  methods"  specifically 
designed  to  resolve  consumer  disputes  currently  exist  in  Europe.  Sometimes  these  are 
supplementary  or  prior  procedures,  such  as  mediation  or  conciliation;  sometimes  they 
offer  access  to  alternative  mechanisms,  such  as  arbitration.  Since  a  given  method  may 
differ  from  country  to  country,  and  in  order  to  avoid  confusion  as  a  result  of  this 
terminological  diversity,  it  should  be  made  clear  that  this  Communication  concerns 
methods which,  no matter what  they are  called,  lead to  the  settling  of  a dispute through 
the  active  intervention  of  a third party who  proposes  or imposes  a solution.  It  does  not 
concern  procedures  that  merely  involve  an  attempt  to  bring  the  parties  together  to 
convince them to find a solution by common consent. 

Systems  for  the  out-of-court  settlement  of  consumer  disputes  differ  greatly  as  regards 
their structure, operation and implementation. 

Out-of-court  instruments may be the fruit of initiatives by public authorities both at central 
level (such as the Consumer Complaints Boards in the Scandinavian countries) and at local 
level  (such  as  the  arbitration  courts  in  Spain);  they  may  also  spring  from  initiatives 
promoted  or  organised  by  individual  associations  or  sectors  (e.g.  bank  and  insurance 
company  mediators  /  ombudsmen)  or  by  professionals  or  establishments  offering 
mediation or arbitration  services  as their main activity (e.g.  lawyers  or private arbitration 
centres). 

10 Communication on "Financial services: enhancing consumer confidence" (COM(97) 309 of 26 June 
1997, which constituted a follow-up to the Green Paper on "Financial services: meeting consumers' 
expectations" (COM(96) 209 of 22 May 1996) 

Precisely  because  of  this  diversity,  the  status  of  the  decisions  adopted  by  these  bodies 
differs  greatly.  Some  are  mere  recommendations  (as  in  the  case  of  the  Scandinavian 
Consumer  Complaints  Boards  and  most  of  the  private  ombudsmen),  while  others  are 
binding only on the professional  (as in the case  of most  of the bank ombudsmen); others 
still are binding on both parties (arbitration). 

However, with an eye to  safeguarding  the interests of the parties involved,  it is necessary 
to  determine  the  extent  to  which  out-of-court  procedures  can  provide  guarantees 
comparable  with  those  offered  by  court  procedures  (notably 
independence  and 
impartiality), while improving practical access to the settling of  disputes. This  question is 
all the more important in that the out-of-court  system, despite its unquestionable merits, is 
not without its weaknesses,  such as the flexibility which makes it possible to exclude strict 
application  of the  legal  rules, the  absence  of  appeal  procedures  in cases where  decisions 
are binding,  or difficulties  in implementing  a decision,  especially in a Member State other 
than that  in which  it was  made (the  1958  New  York  Convention  on the  enforcement  of 
arbitral awards does not apply in all Member States of the European Union11). 

Providing  certain  guarantees  of  "good justice"  in  out-of-court  procedures  might  reduce 
their drawbacks  and  also  enhance  the  credibility  of  out-of-court  systems  for  consumers, 
besides  reinforcing  mutual  confidence  between  the  bodies  that  exist  in  the  different 
Member States. 

11  Portugal,  for  example,  has  not  subscribed  to  this  Convention  (judgment  of  25  July  1991, Rich, 
C-l90/89, ECR 1-3855). This means that the recognition and enforcement  of arbitral awards are not 
guaranteed throughout the European Union. 

I.  THE CONTENT OF THE PROPOSED ACTION 

With this Communication the Commission is launching two initiatives designed to improve 
consumer  access  to  justice.  The  Commission's  aim  is  to  supplement  the  policy  of  the 
Member  States in this area with  a view to  realising  a "high  level  of consumer  protection" 
in compliance with Article  129a of the Treaty; in keeping with the principle of subsidiarity 
(Article  3b  of  the  Treaty),  the  content  of  the  action  is  limited  to  what  is  necessary  to 
achieve the objective,  and the idea is that the proposed  initiative will be implemented  on a 
voluntary basis. 

1.1  Encouragement  of amicable settlement of consumer problems 

In  this  context  the  Communication's  paramount  goal  is  to  encourage  and  facilitate  the 
settling  of  consumer  conflicts  at  an  early  stage  so  that  the  parties  can  avoid  the 
inconvenience of initiating proceedings  (in court  or, for  that  matter,  out  of court). To this 
end  the  Communication  presents  a  "European  claim  form  for  consumers",  designed  to 
improve communication between consumers and professionals  with  a view to  settling their 
disputes amicably. If the dialogue between the consumer  and  professional  does not lead to 
a solution, this form  could be used to initiate an out-of-court  procedure.  Ideally the bodies 
responsible  for  out-of-court  settlement  of  consumer  disputes  should  agree  to  open  a 
procedure  coming  within  their  remit  on  the  basis  of  simple  lodgement  of  the  European 
form,  so as to make the most of the possibilities offered  by this form. 

This claim form  may be used  at both  national  and cross-border  level, independently  of the 
value  of  the  claim  or  the  type  of  consumer  dispute  in  question.  It  is  for  the  parties 
' themselves  to  decide  to  what  extent  their  problem  through  use  of  the  form.  As  regards 
financial  services  in  particular,  the  ongoing  "dialogue"  between  the  financial  services 
industry  and  consumers  is  currently  examining  the  appropriateness  of  this  form  for 
disputes concerning financial  services. 

The  form  will  be  available  on  the  Internet  for  all  interested  persons  and  organisations 
(hup ://europa. eu. int/comm/dg24) in all the languages of the European  Union. The form  as 
such  cannot  be  altered,  but  the  organisations  (firms,  associations  of  firms,  consumer 
organisations,  consumer  information  centres,  etc.) that  propose  its use to  consumers  may 
"personalise" it by printing their logo in the top right-hand corner. 

The "consumer  claim  form",  whose  current  wording  is based  on  numerous  consultations 
with  the  parties  concerned  and  the  Member  States,  has  been  designed  with  a  view  to 
"guiding"  and  orientating  consumers  in  formulating  their  claims.  It  proposes  a  choice  of 
multiple  responses  to  help  consumers  indicate  their  problems  and  describe  their  claim, 
while leaving enough space for users to add supplementary details or to  describe particular 
cases  not  covered  by  the  form's  lists.  The  combination  of  a  multiple-choice  system  and 
free  text  will  considerably  facilitate  translation  in the case  of cross-border  disputes  where 
the parties speak different  languages. The  Commission  will  make any technical  changes to 
the form  which may prove desirable. 

This Commission initiative is a pilot project.  After  two years the Commission  will evaluate 
the pertinence and impact of the form  on the basis of the experience gained. 

Providing  appropriate  safeguards  in  connection  with  the  creation  and 

1.2. 
operation  of out-of-court  bodies responsible for resolving consumer disputes. 

The  second  strand  of  the  Commission's  initiative  takes  the  form  of  a  Recommendation 
designed  to  establish  a  series  of  principles  applicable  to  the  operation  of  out-of-court 
bodies (existing or yet to be created) for resolving consumer disputes. 

The  out-of-court  procedures  concerned  by  this  Recommendation  are  those  which, 
whatever  their  "legal  nature"  (decision,  recommendation  or  settlement  proposal),  involve 
the mediation of a third party whose role is not confined  to persuading  the parties to  reach 
agreement but who express a firm position concerning settlement  of the dispute. 

Respect  for  certain  principles  -  such  as  independence,  transparency  and  effectiveness  -
should  contribute to  a higher level of protection  of consumer  rights.  In  parallel,  provision 
of these  safeguards  will  make for  greater  reliability  and  confidence.  This  confidence  must 
be built up at two levels: firstly,  consumers  - aware of the guarantees provided by the out-
of-court  procedures  available to them -  will be able to  make the most  of the  out-of-court 
system in their own country,  or that of another Member  State in the  event  of  cross-border 
disputes, without  misgivings or reservations;  secondly,  the bodies  responsible  for  the  out-
of-court  settlement  of  consumer  disputes  in  the  different  EU  countries  will  have  more 
confidence  in each other, in connection with cross-border  disputes. Mutual  confidence will 
enable them to  cooperate effectively  in improving  the processing  of  consumer  disputes  of 
a cross-border  nature. The Commission  will facilitate  the networking  of these bodies so as 
to  promote  their  active  collaboration  in  resolving  specific  cases.  Ultimately,  consumers 
should  be  able  to  refer  cross-border  disputes  to  the  competent  out-of-court  body  in  the 
foreign  country via the corresponding out-of-court  body in their own  country. 

To  this  end,  the  existing  out-of-court  bodies  in  the  Member  States  should  respect  the 
principles set out in this Recommendation.  Consumer  associations  and trade associations -
both individually and jointly - have a key role to play in realising this objective. 

These  principles  may  also  make  it  easier  for  parties  providing  out-of-court  settlement 
services established  in one Member State to offer  their services in other Member States. 

In  order  to  ensure  a  level  of  transparency  and  dissemination  of  information  on  out-of-
court  procedures in line with the principles set out in the Recommendation  and to  facilitate 
networking,  the  Commission  intends  to  create  a  database  of  the  out-of-court  bodies 
responsible  for  resolving  consumer  disputes  that  offer  these  safeguards.  In  keeping  with 
the  principle  of  subsidiarity,  the  database  will  contain  particulars  communicated  to  the 
Commission  by  the  Member  States  that  wish  to  participate  in  this  initiative.  To  ensure 
standardised  information  and to  simplify  the transmission  of these  data,  the Commission  is 
providing  the  Member  States  with  a  standard  information  form,  annexed  to  this 
Communication. 

Likewise,  with  an  eye  to  transparency  and  the  provision  of  information,  each  Member 
State  could  appoint  a  single  contact  point  on  its  territory  responsible  for  directing  all 
interested  parties  to  the  bodies  they  should  consult  with  a  view  to  the  out-of-court 
settlement of a specific consumer dispute. 

The  Commission  will  evaluate the  implementation  of this  Recommendation  in two  years' 
time. 

10 

H. 

A EUROPEAN CLAIM FORM FOR CONSUMERS 

11 

Where appropriate,  the seal of the 
body proposing  use of this form  to consumers 

CONSUMER CLAIM FORM 

This form  has  been drawn  up by  the European  Commission 'sservices and should  not  be changed by users.  It  is intended  to improve 
communication  between  consumers  and professionals  in  order,  as far  as possible,  to  reach  an  amicable  solution  to  the  problems 
which  they  may  encounter  in  their  various  transactions.  The form  is available  in all  the  official  languages  of  the European  Union 
(http://europa.eu.int/comm/dg24).  Under no  circumstances  should  it  be sent  to  the  European  Commission,  which  has  no  power 
to intervene  in this  type  of dispute!. 

DETAHS OF THE PARTIES 

Complaint 

submitted  by: 

Against: 

N° 

Name: 
Address, street: 

Town, post code: 
Country: 
Tel: 
Fax: 
Email: 

On behalf of: * 

Name: 
Address, street: 

Town, post code: 
Country: 
Tel: 
Fax: 
Email: 
Other particulars: 

N° 

* To  be  filled  in  only  if  the consumer's  complaint  is presented  by a third  party and  not  by himself.  In  this  case,  the 
consumer  should put his signature under his name. 

INSTRUCTIONS 

• 

• 

In  order  to  identify your  problem  and your  claim,  the form  offers a  choice  of  answers  to  each  question.  Please 
choose  the  answers  (one  or  more)  most  appropriate  to your  case  and,  where  appropriate,  provide  additional 
particulars  in the space  reserved for  this  purpose. 

It  is recommended  that  this form  be accompanied  by  copies  of supporting  documents  and  be sent  by  registered 
post  with  acknowledgement  of  receipt  or  any  other  means  making  it  possible  to  establish  proof  of  dispatch 
and  receipt.  A  copy should  be kept. 

•  The  claimant  should  give  the professional  an  appropriate  amount  of  time  to  reply  (at  least  two  weeks).  The 
professional's  reply must  be communicated  to the claimant by returning  the entire form.  The consumer  must  then 
send him  the reply coupon  (page 4). 

WARNING:  Most  national  laws  stipulate  a time  limit  after  which persons  may  no  longer  seek  redress  through 
the  courts.  Sometimes  this  limitation  period  is  relatively  short,  particularly  in  the  case  of purchases  of  goods. 
Whether  or  not  the  use  of  this form  suspends  this  time  limit  is  determined  by  the  legislation  applicable  to  the 
dispute. 

12 

CONSUMER COMPLAINT 

I.  PROBLEMS ENCOUNTERED: 

Date on which problem(s) was (were) encountered (day/month/year): 

Indicate whether the problem has arisen for the first 

time or not: 

Problem connected with: 

I Q Product not delivered 
2D  Service not provided 
3 0  Delay in delivering product 
4D  Delay in providing service 

Duration of delay 
5 0  Defective product 
6 0  Poor service 
Details 

7 D Product not in conformity with order 
8 D Products/services not ordered 
9 D Damage suffered 
10 0 Refusal to honour the guarantee 
II 0  Refusal to sell 
12 0 Refusal to provide service 
13 0 Fraud 
140  Incorrect information 

33 0 Additional information 

15 0  Inadequate information 
160  Payment arrangements 
170 Price paid 
180  Price increase 
19 0 Supplementary charges 
20 0 Unjustified costs/billing 
210 Terms of contract 
22 0 Coverage of contract 
23 0 Assessment of damage 
24 0 Refusal to pay compensation 
25 0 Inadequate compensation 
26 0 Modification of contract 
27 0  Poor performance of contract 
28 0  Rescission / cancellation of contract 
29 0 Cancellation of service 
30 0 Loan reimbursement 
31 0  Interest demanded 
32 0  Failure to honour commitments 

340  Other type of problem 

* 

n.  THE CIRCUMSTANCES: 

(Indicate the date and place of purchase or signature of the contract, describe the product or service as well  as the price, payment 
arrangements or any other information which may be useful in assessing your complaint: 

45 0 Correction of assessment of damage 
46 0  Payment of an indemnification in the sum of 

47 0  Reimbursement of a down payment in the 
amount of 
48 0  Reimbursement of other payments effected 
in the amount of 
49 0 Price rebate in the amount of 
50 0  Payment of damages in the amount of 

III.  REQUEST BY THE CONSUMER 

To obtain: 

35 0 Delivery of product or provision 
of the service 
36 0 Repair of the product or service 
37 0 Exchange of the product 
38 0 Cancellation of sale 
39 0  Performance of the guarantee 
40 0 Honouring of commitments 
41 0 Conclusion of a contract 
42 0 Rescission / cancellation of contract 
43 0 Cancellation of invoice 
44 0 Information 

51 0 Other particulars: 

52 0 Other type of request 

IV.  ADDITIONAL EXPLANATIONS (OPTIONAL) 

13 

V. 

LEGAL BASIS (OPTIONAL) 

VI.  SUPPORTING  DOCUMENTS  (if  possible  please  attach  to  this  form  one  COPY  of  the  supporting 

documents in your possession, e.g.  invoice, contract,  receipt, etc.) 

List of documents attached:  1 
2 
3 
4 

If  an  amicable  settlement  is  not  reached  or  in  the  absence  of  a  reply  within 
complaint, I reserve the right to refer the matter to any competent body 

days  from  despatch  of  this 

Done at.... 

Signature: 

14 

m.  REPLY FROM THE COMPANY/PROFES$IONALJ 

Reference (to be given by the professional): 

53 01 accede in full and I undertake 
54 0 I accede in part and I propose 

55  0  I  do  not  accept  the  grounds  for  your  complaint  but  agree,  in  the  spirit  of  fair  trading,  to  undertake  to: 

within 

56 0 I reject your complaint 
Grounds: 

.within. 

57 0 I propose that the case be brought before  the body referred  to below, responsible for the out-of-court  settlement 
of this type of consumer disputes: 

Done at 

Signature: 

-X-

TO BE RETURNED TO THE PROFESSIONAL BY THE CONSUMER 

Reference given by the professional: 

Claim submitted by: 

On behalf of: 

Against: 

58 0 I am satisfied and accept your proposal for resolving the dispute 

59 0 I do not accept your proposal because 

60 0 Following your proposal, I wish to inform you that I will submit the dispute to the body you have proposed 

Done at 

Signature: 

, 

15 

m. 

COMMISSION RECOMMENDATION  No .../.../EC ON THE  PRINCIPLES 
APPLICABLE  TO  THE  BODIES  RESPONSIBLE  FOR  OUT-OF-COURT 
SETTLEMENT OF CONSUMER  DISPUTES 

THE COMMISSION OF THE EUROPEAN  COMMUNITIES, 

Having  regard  to  the  Treaty  establishing  the  European  Community  and  in  particular 
Article  155 thereof, 

Whereas  the  Council,  in  its  conclusions  approved  by  the  Consumer  Affairs  Council  of 
25 November  1996, emphasised the need to boost consumer confidence  in the  functioning 
of the  internal  market  and  consumers'  scope  for  taking full  advantage  of  the  possibilities 
offered  by the internal  market,  including the possibility for  consumers to  settle disputes in 
an efficient  and appropriate manner through  out-of-court  or other comparable procedures; 

Whereas the European  Parliament,  in its Resolution  of  14 November  199612, stressed  the 
need  for  such  procedures  to  meet  minimum  criteria  guaranteeing  the  impartiality  of  the 
body, the efficiency  of the procedure  and the publicising  and transparency  of  proceedings 
and called on the Commission to draft  proposals on this matter; 

Whereas  most  consumer  disputes,  by  their  nature,  are  characterised  by  a  disproportion 
between  the  economic  value  at  stake  and  the  cost  of  its judicial  settlement;  whereas  the 
difficulties  that  court  procedures  may  involve  may,  notably  in  the  case  of  cross-border 
conflicts,  discourage consumers from  exercising their rights in practice; 

Whereas  the  "Green  Paper  on  the  access  of  consumers  to  justice  and  the  settlement  of 
consumer  disputes  in the  single  market"13  was  the  subject  of  wide-ranging  consultations 
whose  results  have  confirmed  the  urgent  need  for  Community  action  with  a  view  to 
improving the current  situation; 

Whereas  the  experience  gained  by  several  Member  States  shows  that  alternative 
mechanisms  for  the  out-of-court  settlement  of  consumer  disputes  -  provided  certain 
essential  principles  are  respected  - have  had  good  results,  both  for  consumers  and  firms, 
by reducing the cost of settling consumer disputes and the duration  of the procedure; 

level  would  facilitate  the 
Whereas  the  adoption  of  such  principles  at  European 
implementation  of out-of-court  procedures for  settling consumer  disputes; whereas, in the 
case  of  cross-border  conflicts,  this  would  enhance  mutual  confidence  between  existing 
out-of-court  bodies in the different  Member  States and  strengthen  consumer confidence  in 
the  existing  national  procedures;  whereas  these  criteria  will  make  it  easier  for  parties 
providing  out-of-court  settlement  services  established  in  one Member  State to  offer  their 
services in other Member States; 

12  European  Parliament  Resolution  on  the  Commission  Communication  "Action  plan  on  consumer 
access to justice and  the  settlement  of consumer  disputes  in  the  internal  market"  of  14 November 
1996, OJ No C 362, 2.12.1996, p. 275. 

13  COM(93) 576 final of 16.11.1993. 

16 

Whereas  one  of  the  conclusions  of  the  Green  Paper  concerned  the  adoption  of  a 
Commission  Recommendation  with  a  view  to  improving  the  functioning  of  the 
ombudsman systems responsible for handling consumer disputes; 

Whereas  the  need  for  such  a Recommendation  was  stressed  during  the  consultations  on 
the  Green  Paper  and  was  confirmed  during  the  consultation  on  the  "Action  Plan" 
Communication14 by a very large majority of the parties concerned; 

Whereas this Recommendation  must be limited to procedures which, no matter what they 
are called, lead to the settling of a dispute through the active intervention of a third party, 
who  proposes  or imposes  a solution; whereas,  therefore,  it  does  not  concern  procedures 
that  merely  involve  an attempt  to  bring  the  parties  together  to  convince  them  to  find  a 
solution by common consent; 

Whereas the decisions taken by out-of-court  bodies may be binding on the parties, may be 
mere recommendations or may constitute  settlement proposals which have to be accepted 
by the parties; whereas  for the purposes  of this Recommendation  these  various cases are 
covered by the term "decision"; 

Whereas  the  decision-making  body's  impartiality  and  objectivity  are  essential  for 
safeguarding the protection of consumer rights and for strengthening consumer  confidence 
in alternative mechanisms for resolving consumer disputes; 

Whereas  a body  can  only  be  impartial  if,  in  exercising  its  functions,  it  is  not  subject  to 
pressures  that  might  sway  its  decision;  whereas,  therefore,  its  independence  must  be 
guaranteed  without  this  implying  the  need  for  guarantees  that  are  as  strict  as  those 
designed to ensure the independence of judges in the judicial system; 

Whereas, when the decision is taken by an individual, the decision-maker's impartiality can 
only be assured  if he can  demonstrate  that  he possesses  the  necessary  independence and 
qualifications  and works in an environment which allows him to decide on an autonomous 
basis; whereas this requires the person to  be granted  a mandate  of  sufficient  duration, in 
the course of which he cannot be relieved of his duties without just cause; 

Whereas, when the decision  is taken by a group,  equal  participation  of representatives  of 
consumers and professionals is an appropriate way of ensuring this independence; 

Whereas, in order to ensure that the persons concerned  receive the information they need, 
the  transparency  of  the  procedure  and  of  the  activities  of  the  bodies  responsible  for 
resolving  the  disputes  must  be  guaranteed;  whereas  the  absence  of  transparency  may 
adversely  affect  the  rights  of  the  parties  and  cause  misgivings  as  to  out-of-court 
procedures for resolving consumer disputes; 

Whereas  certain  interests  of the  parties  can  only  be  safeguarded  if  the  procedure  allows 
them to  express  their viewpoints  before  the  competent  body  and  to  acquaint  themselves 
with  the  facts  presented  by  the  opposing  party  and,  where  applicable,  the  experts' 
statements; whereas this does not necessarily necessitate oral hearings of the parties; 

14  Action  Plan  on consumer  access to justice  and  the  settlement  of consumer  disputes  in  the  internal 

market, COM(96) 13 final of 14.2.1996. 

17 

Whereas  out-of-court  procedures  are  designed  to  facilitate  consumer  access  to  justice; 
whereas,  therefore,  if  they  are  to  be  effective,  they  must  remedy  certain  problems 
associated  with  court  procedures,  such  as  high  fees,  long  delays  and  cumbersome 
procedures; 

Whereas, in order to enhance the effectiveness  and equity of the procedure, the competent 
body must play an active role which allows it to take into consideration any element useful 
in  resolving  the  dispute; whereas  this  active  role  is  all  the  more  important  when,  in the 
framework  of out-of-court  procedures, the parties in many cases  do  not  have the  benefit 
of legal advice; 

Whereas the out-of-court  bodies may decide not only on the basis of legal rules but also in 
equity and on the basis of codes  of conduct; whereas,  however,  this flexibility  as regards 
the  grounds  for  their  decisions  should  not  lead  to  a  reduction  in  the  level  of  consumer 
protection by comparison with the protection  consumers would  enjoy,  under Community 
law, through the application of the law by the courts; 

Whereas  the  parties  are  entitled  to  be  informed  of  the  decisions  handed  down  and  of 
grounds  for  these  decisions;  whereas  the  grounds  for  decisions  are  a  prerequisite  for 
transparency and the parties' confidence in the operation of out-of-court procedures; 

Whereas in accordance with Article 6 of the European Human Rights Convention,  access 
to the courts is a fundamental right that knows no exceptions; whereas  since  Community 
law  guarantees  free  movement  of  goods  and  services  in  the  common  market,  it  is  a 
corollary of those freedoms that operators, including consumers, must be able, in order to 
resolve any disputes arising from their economic activities, to bring actions in the courts of 
a  Member  State  in  the  same  way  as  nationals  of  that  State;  whereas  out-of-court 
procedures cannot be designed to replace court procedures; whereas, therefore,  use of the 
out-of-court  alternative  may  not  deprive  consumers  of  their  right  to  bring  the  matter 
before  the  courts unless they  expressly  agree to  do  so,  in full  awareness of the facts and 
only after the dispute has materialised; 

Whereas  in  some  cases,  and  independently  of  the  subject  and  value  of  the  dispute,  the 
parties  and  in  particular  the  consumer,  as  the  party  who  is  regarded  as  economically 
weaker  and  less  experienced  in  legal  matters  than  the  other  party  to  the  contract,  may 
require the legal advice of a third party to defend and protect their rights more effectively; 

Whereas,  in  order to  ensure  a level  of transparency  and dissemination  of  information  on 
out-of-court  procedures  in line with the principles set out  in the Recommendation  and to 
facilitate  networking,  the  Commission  intends  to  create  a  database  of  the  out-of-court 
bodies  responsible  for  resolving  consumer  disputes  that  offer  these  safeguards;  whereas 
the  database  will  contain  particulars  communicated  to  the  Commission  by  the  Member 
States  that  wish  to  participate  in  this  initiative;  whereas,  to  ensure  standardised 
information  and  to  simplify  the  transmission  of  these  data,  a  standard  information  form 
will be made available to the Member States; 

Whereas,  finally,  the  establishment  of  minimum  principles  governing  the  creation  and 
operation  of  out-of-court  procedures  for  resolving  consumer  disputes  seems,  in  these 
circumstances,  necessary  at Community  level  to  support  and  supplement,  in  an  essential 
area,  the  initiatives  taken  by  the  Member  States  in  order  to  realise,  in  accordance  with 
Article  129a  of the  Treaty,  a high level  of  consumer  protection;  whereas  it  does  not  go 

18 

beyond  what  is  necessary  to  ensure  the  smooth  operation  of  out-of-court  procedures; 
whereas it is therefore consistent with the principle of subsidiarity, 

RECOMMENDS  that all existing bodies  and bodies to be created  with responsibility  for 
the out-of-court  settlement of consumer disputes respect the following principles: 

I 

Principle of independence 

The  independence  of  the  decision-making  body  is  ensured  in  order  to  guarantee  the 
impartiality of its actions. 

When the decision is taken by an individual, this independence is in particular  guaranteed 
by the following measures: 

-  the person appointed possesses the abilities, experience and competence,  particulariy in 
the field of law, required to carry out his function; 

-  the person  appointed  is granted  a period  of  office  of  sufficient  duration to  ensure the 
independence  of  his  action  and  shall  not  liable  to  be  relieved  of  his  duties without just 
cause; 

if the person concerned is appointed or remunerated by a professional  association or an 
- 
enterprise, he must not, during the three years prior to assuming his present function, have 
worked  for  this  professional  association  or for  one  of  its  members  or for  the  enterprise 
concerned. 

When the decision is taken by a collegiate body, the independence  of the body responsible 
for taking the  decision  must be ensured  by giving  equal  representation  to  consumers and 
professionals or by complying with the criteria set out above. 

II 

Principle of transparency 

Appropriate  measures  are  taken  to  ensure  the  transparency  of  the  procedure.  These 
include: 

1.  Provision  of  the  following  information,  in  writing  or  any  other  suitable  form,  to  any 
persons requesting it: 

-  a  precise  description  of  the  types  of  dispute  which  may  be  referred  to  the  body 
concerned,  as  well  as  any  existing  restrictions  in  regard  to  territorial  coverage  and the 
value of the dispute; 

-  the  rules  governing  the  referral  of  the  matter  to  the  body,  including  any  preliminary 
requirements  that  the  consumer  may  have  to  meet,  as  well  as  other  procedural  rules, 
notably those concerning the written or oral nature of the procedure,  attendance in person 
and the languages of the procedure; 

19 

-  the possible cost of the procedure for the parties, including rules on the award of costs 
at the end of the procedure; 

-  the  type  of  rules  serving  as  the  basis  for  the  body's  decisions  (legal  provisions, 
considerations of equity, codes of conduct, etc.); 

-  the decision-making arrangements within the body; 

-  the  legal  force  of  the  decision  taken,  whereby  it  shall  be  stated  clearly  whether  it  is 
binding on the professional  or on both parties. If the decision is binding, the penalties to be 
imposed  in the  event  of  non-compliance  shall  be  stated,  as  shall  the  means  of  obtaining 
redress available to the losing party. 

2.  Publication by the competent  body of an annual report setting  out the decisions taken, 
enabling the results obtained to be assessed and the nature of the disputes referred to it to 
be identified. 

III. 

Adversarial  principle 

The procedure to  be followed  allows  all  the parties concerned  to  present  their viewpoint 
before the competent  body and to hear the arguments and facts  put forward  by the other 
party, and any experts' statements. 

IV. 

Principle of  effectiveness 

The effectiveness  of the procedure is ensured through measures guaranteeing: 

-  that  the  consumer  has  access  to  the  procedure  without  being  obliged  to  use  a legal 
representative; 

-  that the procedure is free of charges or of moderate costs; 

-  that only short periods elapse between the referral of a matter and the decision; 

-  that  the  competent  body  is  given  an  active  role,  thus  enabling  it  to  take  into 
consideration any factors conducive to a settlement of the dispute. 

V. 

Principle of legality 

The  decision  taken  by  the  body  may  not  result  in  the  consumer  being  deprived  of  the 
protection afforded  by the mandatory provisions of the law of the State in whose territory 
the  body  is  established.  In  the  case  of  cross-border  disputes,  the  decision  taken  by  the 
20 

body  may  not  result  in  the  consumer  being  deprived  of  the  protection  afforded  by  the 
mandatory provisions applying under the law of the Member State in which he is normally 
resident in the instances provided for under Article 5 of the Rome Convention  of  19 June 
1980 on the law applicable to contractual obligations. 

All decisions are communicated to the parties concerned as soon as possible, in writing or 
any other suitable form, stating the grounds on which they are based. 

VI. 

Principle of liberty 

The decision taken by the body concerned may be binding on the parties only if they were 
informed of its binding nature in advance and specifically  accepted this. 

The  consumer's  recourse  to  the  out-of-court  procedure  may  not  be  the  result-of  a 
commitment  prior to  the  materialisation  of the  dispute,  where  such  commitment  has the 
effect  of depriving the  consumer  of his right to  bring  an action  before  the  courts  for the 
settlement of the dispute. 

VII. 

Principle of representation 

The procedure does not deprive the parties of the right to be represented  or assisted  by a 
third party at all stages of the procedure. 

THIS RECOMMENDATION  is addressed to the bodies  responsible  for the  out-of-court 
settlement of consumer disputes, to any natural or legal person responsible for the creation 
or operation  of such bodies,  as well  as to the Member  States,  to  the extent  that they are 
involved. 

21 

ANNEX 

INFORMATION FORM ON THE OUT-OF-COURT BODIES 
RESPONSIBLE FOR RESOLVING CONSUMER DISPUTES 

PARTICULARS  OF  THE  BODY:  (Indicate  the  name,  address,  telephone  and  fax 
numbers,  e-mail  address,  and  any  other  details  making  it  easier  for  interested  persons  to 
contact the body) 

STRUCTURE:  (Describe  the  composition  of the body,  stating  whether  it  consists  of an 
individual  or  whether  it  is  a  collegiate  body,  the  duration  of  its  mandate  and  the  rules 
governing appointment  and dismissal of the persons responsible for  decision-making) 

POWERS:  (Describe  the  type  of  disputes  treated,  the  geographical  coverage  and  any 
existing thresholds as regards the value of the dispute) 

PROCEDURE:  (Describe  the  rules  governing  referral,  notably  any  prior  steps  which 
must  be taken by the consumer,  the time limits within  which  consumers  must  take  action, 
stating whether  or not  consumers must attend  the proceedings  in person,  and whether  the 
procedure is written or oral) 

COSTS  (Indicate the possible cost of the procedure and any rules on the sharing of fees at 
the end of the  procedure) 

NATURE  OF THE  DECISION: (Indicate whether the procedure culminates in a binding 
decision for  one of the two parties, a mere recommendation  or a settlement  proposal) 

ENFORCEMENT:  (When  the  procedure  leads  to  a  binding  decision,  indicate  how  this 
decision is  enforced) 

22 

ISSN 0254-1475 

COM(98) 198 final 

DOCUMENTS 

EN 

10  06  01 

Catalogue  number  :  CB-CO-98-307-EN-C 

ISBN  92-78-36010-4 

Office  for  Official  Publications of the European  Communities 

L-2985  Luxembourg 

23