The European Union actively promotes alternative dispute resolution (“ADR”).

In April 2002, the Commission published a Green Paper on alternative dispute resolution. In July 2004, the Commission organised the launch of a Code of Conduct for Mediators which was approved and adopted by a large number of mediation experts. In October 2004, the Commission adopted and submitted to the European Parliament and the Council a proposal for a Directive on certain aspects of mediation in civil and commercial matters. The Directive was adopted on 21 May 2008.

The Green Paper, the Code of Conduct and the Directive on mediation all form part of the European Community’s current work on establishing an area of freedom, security and justice, and particularly on improving access to justice. It is the Commission’s view that encouraging the use of mediation and other forms of ADR assists in the resolution of disputes and helps to avoid the worry, time and cost associated with court-based litigation and so assists citizens in an efficient way to secure their legal rights.

The Green Paper

Following on from the Vienna Action Plan in 1998 and the Conclusions of the Tampere European Council in 1999, the Council of Justice and Home Affairs Ministers called on the Commission to present a Green Paper on alternative dispute resolution in civil and commercial law other than arbitration, taking stock of the current situation and launching broad consultations on the measures to be taken. Priority was given to the possibility of laying down basic principles, either in general or in specific fields, which would offer the requisite guarantees that out-of-court dispute resolution would ensure the proper degree of security in the administration of justice.

In its Green Paper the Commission recalled that the development of these forms of dispute settlement was not to be regarded as a means of remedying deficiencies in the operation of the courts but as an alternative, more consensus-based form of social peace-keeping and conflict and dispute resolution which in many cases would be more appropriate than the resolution of disputes by a third party through the courts or by arbitration.

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The main purpose of the Green Paper was to come up with answers to the delicate question of the balance to be achieved between the need for flexibility and the need to guarantee quality of results, and a harmonious relationship with court procedures. It also highlighted the existing achievements and initiatives in this area both in the Member States and in the Community.

The 21 questions put in the Green Paper concerned the key elements of the different forms of alternative dispute resolution, such as clauses providing agreements to go to ADR, the problem of periods of prescription and limitation, the need for confidentiality, the validity of consent, the effect of resulting agreements particularly for enforcement, training for mediators and other third parties, their accreditation and the rules governing their liability.

The Code of Conduct

The European Code of Conduct for Mediators sets out a series of norms which can be applied to the practice of mediation and which can be adhered to by mediation organisations. It was elaborated in co-operation with a large number of organisations and individuals among whom are skilled practitioners of mediation and others who are interested in seeing mediation develop in the European Union. The Code of Conduct was adopted by a meeting involving these experts in July 2004 and the Commission was very pleased to be involved in and to have the opportunity to assist this process.

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The Directive on Mediation

The Directive applies to cross-border disputes in civil and commercial matters, with the exception of revenue, customs or administrative matters or the liability of the State for acts or omissions in the exercise of State authority.

The Directive seeks to promote the use of mediation by making certain legal rules available within the legal system of each Member State. These rules cover, inter alia, the areas of confidentiality of the mediation process and the suspension of the running of periods of prescription and limitation of actions while mediation is in progress, thus removing one potential disincentive to the use of mediation. The Directive also encourages the training of mediators and the adoption of codes of conduct to ensure the quality of mediation throughout the European Union.

The Directive obliges Member States to set up a mechanism by which agreements resulting from mediation can be rendered enforceable if both parties so request. This can be achieved, for example, by way of approval by a court or certification by a public notary. The choice of mechanism is left to Member States. This provision will enable parties to give an agreement resulting from mediation a status similar to that of a judgment without having to commence judicial proceedings. This possibility, which currently does not exist in all Member States, can provide an incentive for parties to resort to mediation rather than go to court. Although parties will in most cases voluntarily comply with the terms of an agreement reached through mediation, the possibility of obtaining an enforceable title can be desirable for obligations such as maintenance, which require regular payments over a fairly long period, in the course of which the willingness of the debtor to fulfil his or her obligations voluntarily may deteriorate.

The Directive entered into force on 13 June 2008. EU Member States will have until 21 May 2011 to bring into force the necessary laws, regulations and administrative provisions to comply with the Directive.

Other achievements and initiatives at Community level in the area of ADR

Alternative dispute resolution has already been recommended, directly or indirectly, in a number of Community instruments and proposals. Many of these encourage Member States to introduce ADR.

The following Commission initiatives are particularly noteworthy:

• Following a Commission proposal, on 27 January 2003, the Council adopted Directive 2003/8/EC concerning minimum common rules relating to legal aid for cross-border disputes. The Directive provides for legal aid to be available for extra-judicial proceedings in certain circumstances to help persons who lack sufficient resources where aid is necessary to secure effective access to justice.
• As regards family relationships, the Commission has endeavoured to promote alternative dispute resolution in Regulation (EC) 2201/2003 of 27 November 2003 concerning jurisdiction and the recognition and enforcement of judgments in matrimonial matters and in matters of parental responsibility.
• Regarding consumer disputes in e-commerce, the role of alternative dispute resolution is stressed both in Directive 2000/31/EC on electronic commerce and in a Joint Declaration by the Council and the Commission made when the "Brussels I" Regulation on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters was adopted.
• Directive 98/10/EC on the application of open network provision (ONP) to voice telephony and on universal service for telecommunications in a competitive environment provides that "easily accessible and in principle inexpensive procedures shall be available at a national level to resolve such disputes in a fair, transparent and timely manner" in the Member States.
• Directive 2002/21/EC (Framework Directive) on a common regulatory framework for electronic communications networks and services provides for non-judicial structures to settle disputes between professionals.

In some areas the Commission has gone further than simply encouraging the establishment of alternative dispute resolution. It has sought to promote the quality and effectiveness of alternative dispute resolution in consumer disputes.

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The quality of alternative dispute resolution

Care is taken in the Community to distinguish two major categories of alternative dispute resolution available to help consumers settle their disputes with tradespeople:

• Procedures in which the third party finds the solution and puts it to the parties.

The Commission has taken an initiative to ensure that these procedures respect a certain number of principles.

On 30 March 1998 it published a Recommendation concerning procedures in which the third party actually settles the dispute between the parties in a manner which may or may not be binding on them. This Recommendation also covers arbitration in consumer disputes. It contains seven basic principles: independence, transparency, the adversarial principle, effectiveness, legality, liberty and representation.

• Procedures in which third parties help the parties come to an agreement without actually formally expressing an opinion on the different possible solutions to the dispute.

The Commission has taken an initiative to ensure that also these consumer dispute settlement procedures respect a certain number of principles. On 4 April 2001, it published a Recommendation concerning procedures in which the third party does not express an opinion on the solution but simply helps the parties to find the solution that suits them best. The Recommendation sets out four principles: impartiality, transparency, effectiveness and fairness.

Member States are asked to produce an inventory of bodies responsible for the out-of-court resolution of consumer disputes that they regard as compliant with the two Commission Recommendations. The corresponding ADR database is maintained by the Directorate-General for Health and Consumer Protection (DG SANCO).

The effectiveness of alternative dispute resolution

The Commission is behind the establishment of two European networks sharing the objective of facilitating consumer access to non-judicial procedures for the settlement of cross-border disputes in cases where the tradesperson is established in a Member State other than the one where the consumer resides. They pursue the same objective but work in different ways:

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• The European Consumer Centres Network ("ECC- Net") is a structure to provide assistance and information for consumers, consisting of European Consumer Centres in all Member States plus Iceland and Norway. The Network provides consumers with information and assistance in accessing an appropriate ADR scheme in another Member State. Each of the European Consumer Centres acts as an information relay for the bodies regarded by the Member States as meeting the demands of the two Commission Recommendations concerning the principles applicable to bodies responsible for the out-of-court settlement of consumer disputes.
• The out-of-court complaints network for financial services "FIN-NET" links more than 40 national bodies responsible for the out-of-court resolution of disputes falling under the 1998 Commission Recommendation. FIN-NET offers consumers facing a problem relating to financial services (banking, insurance, investments) easy access to the relevant out-of-court complaint scheme in cross-border cases.
• Additionally, the on-line problem solving network "SOLVIT" was created in July 2002. SOLVIT is designed to help EU citizens and businesses find fast and pragmatic solutions to their internal market problems. SOLVIT consists of a network of 30 centres that work together to solve problems arising from the incorrect application of EU law by national administrations. There is a SOLVIT centre in all EU Member States and in Iceland, Liechtenstein and Norway.

Encouragement for practical initiatives

In parallel with all this quasi-legislative activity, the European Union provides financial support for certain initiatives, in particular in the on-line settlement of consumer disputes. The Commission was financially involved in the launching of ECODIR (Electronic COnsumer DIspute Resolution Platform), an electronic dispute resolution platform.

Reference documents

• Green Paper on alternative dispute resolution in civil and commercial law (COM(2002) 196 final) and summary (PDF file 124 KB) of responses received
• European Code of Conduct for Mediators (PDF file 118 KB)
• Directive 2008/52/EC of the European Parliament and of the Council of 21 May 2008 on certain aspects of mediation in civil and commercial matters
• Council Directive 2003/8/EC of 27 January 2003 to improve access to justice in cross-border disputes by establishing minimum common rules relating to legal aid for such disputes
• Council Regulation (EC) 2201/203 of 27 November 2003 concerning jurisdiction and the recognition and enforcement of judgments in matrimonial matters and in matters of parental responsibility, repealing Regulation (EC) No 1347/2000
• Joint Declaration by the Council and the Commission on Articles 15 and 73 of Council Regulation (EC) No 44/2001 of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters
• Commission Recommendation 98/257/EC of 30 March 1998 on the principles applicable to the bodies responsible for out-of-court settlement of consumer disputes
• Commission Recommendation 2001/310/EC of 4 April 2001 on the principles for out-of-court bodies involved in the consensual resolution of consumer disputes

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