MEPs tackle online trading disputes

Members of the European Parliament are seeking new ways to reduce the legal mess that threatens cross-border ecommerce.

The Brussels Convention currently allows a consumer to take legal action over contractual disputes in the country where he or she lives. But this presents a tortuous legal process for e-tailers selling in a borderless economy as they become subject to the laws of all EU member states.

Last month, a Tory amendment to the legislation sought to put online disputes under the retailer's local laws. It would have allowed ecommerce sites to include disclaimers informing customers that they are under the retail laws of another country. However, this was rejected by the European Parliament.

Conservative MEP Lord Inglewood, who introduced the amendment, told vnunet.com that the fight is not over.

He and fellow MEP Ana Palacio, chairwoman of the European Parliament commission on legal affairs, are looking to refine the concept of the alternative dispute resolution (ADR) procedure, and "give it a badge of respectability that will give buyers of e-goods confidence", said Lord Inglewood.

The procedures should be "market driven and not draw in the Commission", he added.

"It must not be bureaucratic, but if a transaction goes wrong it should have street cred," he said, "but time is of the essence."

His effort coincides with the government's consultation on the Brussels Convention, launched this week.

E-minister Patricia Hewitt said that consumers and businesses want to see disputes settled quickly and cheaply, and believes "the real answer" lies in efficient low-cost ADR, like arbitration or the use of ombudsmen. However, she said that a legal framework must be in place as a last resort.

Mike Pullen, internet lawyer at Dibb Lupton Alsop, who organised the Ecommerce Jurisdiction Forum to campaign against EU legislation which he believes will stifle growth of ecommerce in Europe, said that the consultation is a positive move, but is concerned that "there will still be a problem for UK businesses because ADR is not a panacea for everything".

"It does not address the legal risks for start-ups," he said. "The fact a start-up can still be sued can stop it from setting up. A consumer will not be bound by ADR, so the legal risk remains."

Have your say

We're keen to hear views from readers on how the problem should be tackled. Email us at newseditor@vnunet.com.

See also:

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Loosening Europe's ebusiness boundaries

New legislation from Brussels could make it easier for UK companies to extend their European internet operations.  01 Jun 2000

E-shoppers get right to change their minds

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Online trading to soar in Europe

Online stock trading is set to rocket in Europe, with the number of accounts expected to grow from 1.85 million at the end of 1999, to 4.4 million by the end of this year, according to figures from research group IDC.  11 May 2000

Investors in e-wonderland?

Ecommerce economics are not as unfamiliar as they appear.  11 Apr 2000

Ecommerce hit by legislative wrangles

European Parliament members this week kicked out a Tory amendment of draft legislation that would have been beneficial to online commerce.  31 Mar 2000

EC bans passing consumer data to the US

Is the European Commission trying to do online everything to do with the Single Market it has failed to do offline? As well as setting its anti-monopoly dogs on technology firms, it has ruled UK businesses cannot pass consumer data to states outside the European Union (EU) that lack the right levels of protection.  01 Mar 2000

Europe handcuffs ecommerce with consumer rights laws

by Sylvia Pennington, VNU Newswire  08 Sep 1999

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