Duty to inform consumers about ADR entities in website terms and conditions
The European Court of Justice (ECJ) delivered a judgment clarifying the duty on traders to inform consumers in their website terms and conditions of the alternative dispute resolution (ADR) entity by which they are covered.
This duty is set out in Article 13 of the ADR Directive (2013/11/EU) which requires a trader:
who is obliged by:
- a term of a contract, or
- by regulations issued by its trade association or
- by law
to use ADR services provided by a particular ADR entity,
to provide the name and website address of that entity in its terms and conditions and on its website.
The ruling was delivered following a German court request for a preliminary ruling on whether it was acceptable for a trader to provide the information about the ADR entity in documents accessible on its website, but not in the website terms and conditions themselves, or in a separate document from the general terms and conditions, provided upon conclusion of the contract.
The ECJ found that the trader's practice of providing the details of the ADR entity upon conclusion of a contract contravened Article 6(1) of the Consumer Rights Directive (2011/83/EU).
This requires traders to inform consumers of their possible recourse to an out-of-court complaint and redress mechanism before being bound by a distance or off-premises contract. IN other words, well before an agreement is concluded.
It is to be noted that although the requirement on all online traders and marketplaces to link to the EU's online dispute resolution system will cease at the end of the transition period, the requirements detailed in this case will continue to apply.