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OECD issues new Recommendation on Consumer Dispute Resolution and Redress - August 2007

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The Organisation for Economic Cooperation and Development (OECD) has issued a new Recommendation on Consumer Dispute Resolution and Redress. Adopted by the OECD Council on 12 July 2007, the Recommendation aims to ensure that consumers have access to swift and effective mechanisms to resolve complaints and obtain compensation when transactions with businesses go wrong.

Although the Recommendation applies to all forms of commerce, a major impetus behind its development was to address consumer complaints arising from e-commerce. OECD governments recognised that if they are to take full advantage of the global digital marketplace, consumers need to be confident that they will be able to resolve complaints with businesses online and in other countries.

The Recommendation calls on member countries to update their dispute resolution and redress systems so that they better respond to the varying nature of consumer complaints. Specifically, it identifies three different categories of mechanisms to be included in domestic frameworks - mechanisms for consumers to act individually; mechanisms for consumers to act collectively; and mechanisms for the government to obtain redress for consumers. It then sets out goals to ensure that these mechanisms are more accessible and effective in cross-border cases. The Recommendation also includes provisions on complementary measures that can be taken by the private sector to help consumers resolve disputes efficiently and at the earliest possible stages.

In Australia, the adequacy of existing dispute resolution mechanisms and redress provisions will be reviewed by the Productivity Commission as part of its inquiry into the national consumer policy framework. The final results of the inquiry are due to be released in December 2007.

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