ECC Italy has as institutional mission the promotion and protection of consumers’ rights in cross-border complaints. We assist consumers to prevent problems and help them to exploit as much as possible the advantages coming from the Single Market and from the richer supply of goods and services that this implies.
The dialogue with companies is essential in this activity: on one hand, we establish a first contact, when we help the consumer present the complaint, on the other, we carry out information activities towards economic operators on the legislation on consumer protection, thus favouring the prevention of problems and the establishment of a “customer retention” culture.
Companies who are open to the dialogue, express their opinions and listen to the requests of their customers, can in many respects be regarded as sustainable, far-sighted and well-equipped for facing global challenges.
This section of the web site is dedicated to those companies who are open to the dialogue and are interested in developing policies of consumer protection and customer satisfaction, as well as adopting the “friendly” way of handling of complaints and disputes.
Where and why does the consumer purchase? Quality and customer satisfaction as development policies
Every enterprise aim, as a primary purpose, at increasing its profits in order to gain a better position in the marketplace. Therefore, time ago enterprises used to reduce production costs and increase productivity. However, during the past two decades, their relations with consumers have been radically changing and more attention have been paying on customers’ rights and choices.
At present enterprises have finally understood that consumers are to them an essential element of survival on the market. The analysis of consumers’ behavioral and the customers satisfaction are now at the core of every marketing strategy.
Now, quantity has been replaced by quality, a comprehensive term which includes both technical quality, that is the product (or service) conformity to predetermined standards, and functional quality, that is the capacity of a product (or of a service) to make consumers satisfied, by understanding what they actually wish or need.
However, despite of the improvements above, by now traders have been taking into too little account the importance of another relevant elements: the after-sales service and the customers fidelity.
Global market challenges and competition elements
In a global market, with no territorial or technical barriers, enterprises are always exposed to very competitive contexts.
Therefore, in order to survive and be successful within a liberalized market, traders must both invest in innovation and development and be concentrated on customers’ needs, by taking in high consideration not only their quality-price ratio but also their public reputation, in terms of social and environmental accountability.
The term “Single Market” means a market in which the free movement of goods, services, capital and persons is ensured and in which European citizens are free to live, work, study and do business. Since its creation in 1993, the European Union tried removing barriers to a complete economic integration, but it is a long and complex way still in progress. However, we are talking about one of the greatest EU goals and from 1993 till now the single market has opened more to competition, created new jobs, defined more affordable prices for consumers and enabled businesses and citizens to benefit from a wide choice of goods and services.
Nowadays, the European Union is working towards further simplification of the regulations which still prevent citizens and businesses from making the most of the advantages of the single market.
Necessarily, the free movement of goods, services, capital and persons involves:
- Non-discrimination principle: national and imported products must be treated in the same way;
- The mutual recognition principle: goods which are lawfully produced in one Member State cannot be banned from sale on the territory of another Member State;
- A correct enforcement of the EU law, by a common and unambiguous adaptation of national laws in each Member State.
Corporate Social Responsibility as factor of sustainability and growth
Nowadays, companies competitiveness strictly depends on their social reputation: by now, it is vital for each company to acquire and maintain costumers reliance and fidelity.
But how can a trader act in a responsible way? To comply with the law is not enough: traders must go besides the law, assure employee rights, make training seminars, improve working conditions and guarantee equal opportunities. Moreover, they must talk with consumers and facilitate disputes solutions, well act towards supplies, choosing them on the basis of their “ethics”, and operate out of respect of the environment and the context they live in.
In addition, traders must converse with stakeholders and actively working with them to solve difficulties; they must avoid exploitation or opportunisms and talk to their interlocutors in a serious, transparent, accurate and self-critical way.
ADR: the most convenient dispute resolution mechanism for companies. What is it?
ADR stands for Alternative Dispute Resolution, that is an alternative way to settle disputes. This practice has been frequently used in the Anglo-Saxon world, but it was almost unknown in Continental Europe until the early 90s, particularly in Italy where it is still very rare. It consists of a series of extra-judicial tools allowing the quick and less costly resolution of disputes between consumers and professionals/companies.
According to EU recommendations, the basic principle of this procedure are: independence, transparency, adversarial system, effectiveness, legality, liberty and representation.
For companies in particular, the only alternative procedure used until recent years was arbitration. Nowadays, alternative resolution procedures can be:
- Mediation: transaction that is carried out with the contribution of a third party who improves dialogue between disputants helping them to analyse all possible solution. Without taking a formal position in favour of one or other solution, the mediator helps to reach an agreement that is favourable to both parties. If an agreement is reached, it will be compulsory only once both parties have agreed on its effectiveness.
- Conciliation: a form of dispute settlement in which parties reach an agreement with the contribution of a neutral third party (the conciliator) who has no capacity to take decisions. It differs from mediation because the conciliator is generally a public body and because the resolution is reached making use of legal rules.
- Arbitration differs from the other two procedures, which are quite similar between them, because in this case the third party (the arbitrator) has the power to settle the dispute and his decision has the same value and effectiveness of a judgment. This procedure is mainly used in business-to-business disputes, given the higher costs and the necessary qualification of the arbitrator.
ADR procedures can be applied to very easily and at quite reasonable prices: one of the two parties refers to an ADR body declaring the will to settle the dispute through extra-judicial procedures, providing all necessary documentation and the economic quantification of the dispute. The ADR body contacts then the counterpart inviting it to take part to the attempt of settling the dispute. If both parties agree, service charges are paid, a conciliator (or arbitrator) is named and the date for the initiation of proceeding is defined. If an agreement is reached, the conciliator draws up a conciliation document that both parties will have to subscribe. In case of no agreement, a document of failed conciliation will be drawn up and parties will be free to bring the case before the Court.
Beyond this form of conciliation, another common practice in Italy is an on equal-terms mediation (so called “conciliazione paritetica”, in which a Mediaton Commission is composed including a representative of the Consumers Organization, on behalf of the consumer, and a representative of the company/professional. In this case, there is no need for a third party since the resolution of the dispute should be reached inter partes. This kind of conciliation is very effective in disputes between consumers and utility companies.
ADR notified bodies
ADR bodies can be notified to the European Commission by national Authorities, provided that their functioning is in accordance with two Recommendations: 98/257/EC and 2001/310/EC.
Italian notified ADR bodies are:
- The Banking Ombudsman
- The Chambers of Commerce of Milan and Rome
- Telecom Conciliation and Arbitration Commissions, composed by a conciliator named by Telecom and by a member of the Consumer Association. These commissions are active in all Telecom regional offices in Italy.
Furthed contact details in the DG Sanco website
The traditional way: judicial remedies
As we saw, the conciliation – as well as other alternative dispute resolution procedures – is the easiest, quickest and cheapest way to settle a dispute.
Anyway, conciliation procedure might fail, as well as the parties involved might choose directly the legal way. Before starting the trial, the judge, in some matters, is obliged to propose, once again, the alternative dispute resolution procedure, but it’s obvious that the parties aren’t willing to accept, so the dispute will follow the legal steps, till the binding judgment.
In these cases both parties need a lawyer for being represented, incur higher expenses – including legal expenses, which are to be paid apart from the process outcome – and spend much more time in solving the dispute. Indeed, the costs of a trial are much higher than the ADR ones and rarely proportioned to the dispute value (which usually are of a modest extent).
In case of cross borders claims, the legal procedure is very hard to be carried out also because of physical, linguistic, structural and procedural barriers, besides the difficulty in identifying the law in force. The EU created a European Judicial Network in civil and commercial matters, in order to simplify the disputes handling within the EU.
For additional information on judicial remedies, in particular at cross-border level, please visit the section of this website devoted to “ADR and other dispute resolution systems”.
Handling consumer's complaints appropriately, reducing negative impacts
The advantages of choosing the ADR procedure, concerning time and expenses, are valid not only for consumers but also for traders, in terms of both public image and relations with customers. Therefore, the legal way should be chosen only if it is the last possibility to solve the matter.
It is very important for the trader to maintain good relationships with its consumers and solve efficiently any possible claim, in order to improve its position on the market. In this sense, the ADR procedure manages to solve the problems arisen, in a untroubled and friendly context, preserving its relations with consumers.
For all these reasons, we advise traders to listen to their consumers, preferring the dialogue instead of the argument, apart from those cases in which parties’ positions are, actually, irreconcilables.
Trends of European policies on ADR
European Commission has always been very active in promoting ADR procedures, by spreading their use and trying, at the same time, to make ordinary justice more efficient.
Therefore, the European Commission enforced two basic Recommendations on the principles applicable to the bodies responsible for out-of-court settlements of consumer disputes.
- The first Recommendation, n. 257, of 30 March 1998, invited Member States to draw up a list of national authorities entitled to deal with extrajudicial disputes and established seven minimum principles governing the creation and operation of out-of-court procedures for resolving consumer disputes (independence, transparency, effectiveness, legality, liberty, representation and adversarial principles).
- The second Recommendation, n. 310, of 4 April 2001, stated the principles for out-of-court bodies involved in the consensual resolution of consumer disputes.
Furthermore, on 19 April 2002, the European Commission issued a Green paper on alternative dispute resolution in civil and commercial law, to draw up a detailed inventory of the various initiatives and projects undertaken by the Member States and by the European Union and to point out the qualifications that ADR bodies must comply with.
Nevertheless, within the EU the ADR system have been developing in many different ways, concerning qualified bodies, procedures applied, the need to take ADR, the obligatoriness of the procedure and, finally, the costs incurred.
In order to simplify ADR dissemination, the European Commission created two networks of national bodies for the extra-judicial settlement of cross-borders consumer disputes (that are disputes which parties coming from two different Member States):
-The ECC-Network, with its Centres in 29 Member States, informs consumers about the purchase of goods and services and supports them in the event of a complaint or a dispute;
-The FIN-network helps consumer to solve financial matters by entering an out-of-court settlement of disputes.
In case of dispute, parties can choose to turn to an arbiter instead of a judge, by including in the contract a specific clause or signing, at a second time, an appropriate submission.
By this way, an arbiter (or a group of arbiters in case of more complex matters) will solve the dispute, applying parameters of law end equity.
There are two types of arbitration: ritual arbitration, that is a private judgment alternative to the governmental one, and the no-ritual arbitration, which decision is binding for parties.
In case of disputes, arbitration should be preferred considering its quickness in solving the procedure, which must end within 180 days following the first hearing.
Moreover, it is important to distinguish between “ad hoc arbitration”, in which parties establish procedure details by inserting a clause in the contract or signing a separated act, and “administrative arbitration”, that is when parties choose to commit the enforcement of arbitral rules to a third part.
The importance of dialoguing with consumer representatives
In order to better understand consumers’ desires and choices, traders should actively cooperate with consumers associations, which perfectly know consumers’ requests and dissatisfactions.
Therefore, during the years the need to balance traders’ need of earnings and consumers’ need of protection has been leading to a profitable collaboration between the two categories above.
Most of agreement between consumers association and traders regard disputes solutions, in order to find an alternative way to the ordinary judgment, trying to save money and time for consumers and traders, with significant advantages for both parties.
Very relevant agreements have been stipulated with telephone, postal, touristic and insurance companies and numerous banks decided to collaborate with consumers associations with significant outcomes.
ECC-Net in support of consumers and companies
The European Consumers Centres Network aims at supporting the consumption within the EU. It assures consumers information and assistance in case of cross border complaints and promotes the referral to extrajudicial settlement of disputes, cheaper and quicker than the judicial ones.
The Ecc-net assists consumers for free giving them juridical/linguistic support and facilitating the communication with the counter-party. Moreover, when necessary the ECC-Net provides consumers with information about the operative rules and the advantages of the Alternative Dispute Resolution (ADR), that are lower costs, less time spent and maintenance of good relations between parties.
The online conciliation: an easy and successful way to solve cross border disputes
RisolviOnline is a service offered by the Milan Arbitration Chamber that allows commercial disputes to be resolved simply and economically by simply logging on to the Internet.
Due to the absence of any type of barriers, the service can be used all over the world, and the information provided on the website www.risolvionline.it are offered in 23 different languages. It’s a very innovative procedure for the settlement of commercial disputes, thanks to its simplicity, quickness, privacy and cheapness.
RisolviOnline may be used both by individual consumers/users and by enterprises. A solicitor can send in a mediation application or take part in the mediation attempt, acting as a representative for a consumer or enterprise. All disputes of a commercial nature may be submitted to RisolviOnline irrespective of their financial value or the nationality of the entities involved.
RisolviOnline allows a satisfactory agreement to be reached, with the aid of a neutral mediator who is an expert in conflict management in an informal and confidential environment. The mediation attempt will be carried out by discussing the problem in real time by means of a chat line or by means of a discussion forum using a private area of the Internet site accessible only to the parties, the mediator and the Mediation Chamber official in charge of the service.
In their own private area, the parties will be able to communicate with the aid of the mediator, setting out their own cases in full, expressing their demands and assessing their reciprocal positions in an attempt to find a satisfactory solution for both parties by hearing one another out.
A mediator is the person who helps the parties, with impartiality and professionalism, to communicate effectively and find an agreement, without imposing any decision. The mediator is chosen case by case, on the basis of criteria of skill, professionalism, independence and impartiality.
If you work in the e-commerce field, you can add in your online terms and conditions a proper clause informing consumers about the extrajudicial settlement of disputes:
“In case of dispute between (Company name) and consumers, we ensure from now our availability for the extrajudicial settlement of the dispute above provided by “Risolvionline”, a service offered by the Milan Mediation Chamber that allows commercial disputes to be efficiently resolved by simply logging on to the website www.risolvionline.com, thanks to the conciliation of a impartial and professional Mediator.
What are sellers’ duties toward consumers who make purchases on line?
According to the Italian Code of Conduct (Decree n. 206/2005 - art. 52.1) the seller must comply with two fundamental informative duties:
Before concluding the contract, seller must provide consumer with the following information:
a)seller’s identity and, in case of payment in advance, seller’s address;
b)product or service characteristic;
c)product or service price, including taxes and levies;
d)shipping and delivering costs;
e)operative rules about payment, product delivery or service provision, contract implementation;
f)the possibility to withdraw from the contract;
g)operative rules for product delivery in case of withdrawal from the contract;
h)the length of both the offer and the special price offered;
i)le length of the contract in case of continuative/periodic product supply or service provision.
The information above must be provided in a written, clear and comprehensive way.
Moreover, the seller must communicate:
a)all relevant details regarding the right of withdrawal;
b)a valid address in order to lodge complaints;
c)information regarding the Customers Care service and the commercial warranty;
d)the way to assert one’s right of withdrawal in case of contract with a long or indeterminate length.
According to art. 64, in case of on line purchases consumer can withdraw from the contract within 10 working days starting from:
1)in case of product supply, the day of product delivery. However, if the seller does not comply with his information duties, the term starts from the moment when consumer receives all the compulsory information.
2)In case of service provision, the day of conclusion of the contract. However, as above mentioned, if the seller does not comply with his information duties, the term starts from the moment when consumer receives all the compulsory information.
In the following cases there is no right of withdrawal:
a)when the service provision starts within 10 working days following the contract subscription, with the consumers consent;
b)when the product/service price depends on financial floating out of seller’s control;
c)supply of personalized products, which are particular perishable or, due to its intrinsic nature, cannot be sent back;
d)supply of either audiovisual products or originally sealed informatic software, opened by the consumer;
e)supply of newspapers, periodicals and magazines;
f)lotteries and bets services.
Consumers must withdraw from the contract by posting seller a letter by recorded delivery with acknowledgment of receipt. Consumers can also forward in advance their complaint by sending a email or a fax within 10 working days and confirm their claim during the following 48 hours by posting a letter by recorded delivery.
Correct execution of the contract
According to the law, the seller must carry out the order within 30 days following consumer’s request.
in case the product or the service is temporarily unavailable, the seller must inform the consumer and give him back the amount already paid. The seller cannot provide a different product or service, even if of higher value, if the consumer did not give his consent while signing the contract.
The European Commission is currently carrying out an in-depth review of the ADR/ODR policies at EU level, through public consultations and foreseeing the creation of a wide ODR platform to provide European citizens with a fast and effective disputes resolution mechanism. For additional information please visit http://ec.europa.eu/consumers/redress_cons/adr_policy_work_en.htm