Are Alternative Dispute Resolution schemes working for consumers?

Consumer protection is a critical part of the modern economy, supporting consumer confidence in dynamic markets. With consumer markets becoming increasingly complex, including more digital transactions and multiple national and international players, there is a need for the enforcement framework to be strengthened.

The COVID pandemic has both accelerated many of these changes and highlighted existing weaknesses in our system. An effective system will require public enforcement by national agencies, and structures to support private enforcement by consumers.

Alternative Dispute Resolution (ADR) is an important part of this system and should provide consumers and businesses with an accessible and affordable alternative to court proceedings. ADR schemes also have an important role in improving consumer markets by collecting data on consumer issues and engaging businesses, consumer groups and regulators to drive improvements in business practices that benefit all consumers.

ADR is all however all too often a confusing and chaotic experience for consumers. As a result many consumers don’t know how to seek redress or are put off by the complexity, leaving them exposed to harm and unable to confidently resolve their complaints. This report reviews how ADR is working across key sectors and makes a series of recommendations for how the system can be modernised so that it delivers more effectively for consumers.