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Alternative Dispute Resolution (ADR) describes a range of methods (such as mediation and arbitration) designed to avoid the need to go to court to enforce legal rights. Usually these methods are a cheaper and quicker route for resolving a dispute.

In the past, there has been a diverse and patchy approach to ADR in the UK, with several different models in operation in different markets. ADR is mandatory in certain sectors where there is a high risk of consumer detriment. In other sectors, voluntary schemes operate which traders can choose to join and these are usually linked to trade associations.

The EU Directive on Consumer ADR and an EU Regulation on Consumer Online Dispute Resolution were published in July 2013. The requirements of the Directive were implemented into UK law by two sets of regulation, laid in in March and June 2015:

These Regulations (known as the ‘ADR Regulations’) came into force on 9 July 2015, except for the business information requirement which took effect from 1 October 2015.

The Directive requires that the UK Government ensures that all consumer sectors have access to ADR bodies that have been audited against set quality criteria. In addition, the Directive requires that all trade associations who are approved ADR bodies present this information on their website in a clear and concise manner.

Under the new Regulations, if a trader fails to resolve a dispute directly with a consumer, the trader will be required to give the consumer the details of the relevant approved ADR body and indicate whether he/she intends to use it. Nothing requires the trader to actually use the approved body or any other body.  

This Commons briefing Paper outlines the background to, and the main provisions of, the new ADR Regulations 2015. Like the Regulations, this Paper is only concerned with consumer ADR (i.e. a dispute between a trader and a consumer). 

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