Digital Markets, Competition and Consumers Act 2024

Chapter 4 Alternative dispute resolution for consumer contract disputes

Interpretation of Chapter 4

291 Meaning of “ADR” and related terms

(1) This section has effect for the purposes of this Chapter.

(2) “ADR” means any method of securing or facilitating an out-of-court resolution of a consumer contract dispute that is carried out by an independent third party acting in relation to both parties to the dispute.

(3) But the term “ADR” does not include anything carried out by a person in their capacity as—

(a) a judge, or

(b) a member of the staff of a court or tribunal.

(4) The following are examples of ADR (if carried out as mentioned in subsection (2) in relation to a consumer contract dispute)—

(a) mediation;

(b) arbitration;

(c) early neutral evaluation;

(d) action under an ombudsman scheme.

(5) In subsection (2) “resolution” includes—

(a) a decision binding both parties;

(b) a decision which, if accepted by the consumer, binds the trader;

(c) settlement of the dispute between the parties.

(6) “ADR provider” means a person who does either or both of the following—

(a) carrying out ADR in relation to a consumer contract dispute, or

(b) making special ADR arrangements.

(7) “Special ADR arrangements” are (subject to subsection (8)) arrangements made by an ADR provider with another person (whether or not that other person is an exempt or accredited ADR provider) for ADR to be carried out by that other person in relation to one or more consumer contract disputes.

(8) Arrangements made by a person acting for only one of the parties to a consumer contract dispute are not special ADR arrangements.

(9) For the meaning of “exempt ADR provider” and “exempt redress scheme” see section 295.

(10) “Accredited ADR provider” means a person who is for the time being accredited under this Chapter (whether or not their accreditation is limited to particular descriptions of ADR or special ADR arrangements).

(11) In this section “judge” includes—

(a) a member of a tribunal,

(b) a justice of the peace or, in Northern Ireland, a lay magistrate,

(c) a clerk or other officer entitled to exercise the jurisdiction of a court or tribunal, and

(d) a holder of any other public office with functions of a judicial nature.

292 Other definitions

(1) This section has effect for the purposes of this Chapter.

(2) “Consumer contract” means (subject to the following provisions of this section) a contract between a trader and a consumer which is—

(a) a contract to which Chapter 2 of Part 1 of CRA 2015 (contracts to supply goods) applies;

(b) a contract to which Chapter 3 of that Part (contracts to supply digital content) applies;

(c) a contract to which Chapter 4 of that Part (contracts to supply services) applies;

(d) a mixed contract, that is to say a contract to which any two or three of those Chapters apply (see section 1(3) and (4) of that Act).

(3) The reference in subsection (2)(a) to a contract to which Chapter 2 of Part 1 of CRA 2015 applies includes a reference to—

(a) a contract between a gas supplier and a consumer for the supply of gas to any premises;

(b) a contract deemed by paragraph 8(1) or (2) of Schedule 2B to the Gas Act 1986, or by section 12(1) or (2) of the Energy Act (Northern Ireland) 2011 (c. 6 (N.I.)), to exist between a gas supplier and a consumer for the supply of gas to any premises;

(c) a contract between an electricity supplier and a consumer for the supply of electricity to any premises;

(d) a contract deemed to exist by paragraph 3(1) or (2) of Schedule 6 to the Electricity Act 1989 or by paragraph 3(1) or (2) of Schedule 6 to the Electricity (Northern Ireland) Order 1992 (S.I. 1992/231 (N.I.1));

(e) the terms applying as between a water supplier and a consumer in respect of the supply of water to any premises by a water supplier.

(4) In subsection (3)—

• “electricity supplier” means a person who is authorised to supply electricity by a licence or exemption under Part 1 of the Electricity Act 1989 or Part 2 of the Electricity (Northern Ireland) Order 1992;

• “gas supplier” means a person who is authorised to supply gas by a licence or exemption under Part 1 of the Gas Act 1986 or Part 2 of the Gas (Northern Ireland) Order 1996 (S.I. 1996/275 (N.I.2));

• “water supplier” means—

  (a)

  a water undertaker or a water supply licensee within the meaning of the Water Industry Act 1991,

  (b)

  a person supplying water under a water services licence within the meaning of the Water Services etc. (Scotland) Act 2005 (asp 3), or

  (c)

  a water undertaker within the meaning of the Water and Sewerage Services (Northern Ireland) Order 2006 (S.I. 2006/3336 (N.I.21)).

(5) The reference in subsection (2)(c) to a contract to which Chapter 4 of CRA 2015 applies includes a contract between a heat supplier and a consumer for the supply of heating, cooling or hot water by means of thermal energy provided from a heat network.

(6) In subsection (5)—

• “heat network” has the meaning given by section 216 of the Energy Act 2023, and

• “heat supplier” means a person who charges for making a supply of heating, cooling or hot water by means of thermal energy provided from a heat network.

(7) In the application of provisions of Part 1 of CRA 2015 for determining whether a contract is a consumer contract for the purposes of this Chapter, the following provisions are to be disregarded—

(a) section 32(2) (provisions excluded from the operation of section 32(1));

(b) section 48(5) (power to exclude services from scope of Chapter 4 of Part 1).

(8) The Secretary of State may by regulations provide that contracts of a description specified in the regulations are excluded from being consumer contracts for the purposes of this Chapter.

(9) The power in subsection (8) includes power to provide that the exclusion only applies in circumstances specified in the regulations.

(10) Regulations under subsection (8) are subject to the affirmative procedure.

(11) “Consumer contract dispute” means a dispute between the parties to a consumer contract which relates to the contract, including a dispute concerning—

(a) anything done by either party before making the contract,

(b) the making of the contract,

(c) obligations under or relating to the contract, or

(d) the performance by either party of their obligations under or relating to the contract.

(12) In subsection (11) “dispute” means a legal dispute, that is to say one which may be determined by a court or tribunal in proceedings brought by either of the parties to the contract.

(13) The “parties” to a consumer contract, or a consumer contract dispute, are the consumer and the trader.

(14) The following terms have the meaning given by section 2 of CRA 2015—

• “consumer”

• “goods”

• “trader”.

But in interpreting the term “consumer” section 2(4) to (6) of that Act is to be disregarded.

Prohibition on acting as ADR provider without accreditation etc

293 Prohibitions relating to acting as ADR provider

(1) A person must not carry out ADR in relation to a consumer contract dispute unless the person—

(a) is an exempt ADR provider whose exemption covers the ADR being carried out,

(b) is an accredited ADR provider whose accreditation covers the ADR being carried out, or

(c) is acting under special ADR arrangements made by—

(i) an exempt ADR provider whose exemption covers the making of those special ADR arrangements, or

(ii) an accredited ADR provider whose accreditation covers the making of those special ADR arrangements.

(2) A person must not make special ADR arrangements in relation to any one or more consumer contract disputes unless the person is—

(a) an exempt ADR provider whose exemption covers the making of those special ADR arrangements, or

(b) an accredited ADR provider whose accreditation covers the making of those special ADR arrangements.

294 Prohibitions relating to charging fees to consumers

(1) An accredited ADR provider must not charge the consumer a fee in respect of ADR being carried out (or to be carried out) in relation to a consumer contract—

(a) by the accredited ADR provider, or

(b) by another ADR provider under special ADR arrangements made by the accredited ADR provider,

unless the fee is charged in accordance with provisions for the charging of fees to consumers which meet the conditions in subsection (2).

(2) The conditions are that the provisions in question—

(a) have been made by the accredited ADR provider,

(b) are approved by the Secretary of State for the purposes of this subsection, and

(c) are published in a manner likely to come to the attention of consumers whose consumer contract disputes may be dealt with by the accredited ADR provider.

(3) An ADR provider who carries out (or is to carry out) ADR in relation to a consumer contract dispute under special ADR arrangements must not charge the consumer any fee in respect of carrying out the ADR in question.

Exempt ADR providers

295 Exempt ADR providers

(1) In this Chapter—

• “exempt ADR provider” means a person who—

  (a)

  is listed (or of a description of persons listed) in Part 1 of Schedule 25, or

  (b)

  is (when carrying out ADR or making special ADR arrangements) acting under or for the purposes of an exempt redress scheme;

• “exempt redress scheme” means a scheme or other similar arrangement which is listed (or of a description listed) in Part 2 of Schedule 25.

(2) The Secretary of State may by regulations amend Schedule 25 for the purpose of—

(a) adding a new entry in Part 1 or 2;

(b) varying or removing an entry for the time being included in Part 1 or 2;

(c) varying the supplementary provision in Part 3.

(3) Regulations under subsection (2) may, in particular—

(a) provide for an entry in Part 1 of Schedule 25 to apply to a specified person or to any person of a specified description;

(b) provide for an entry in Part 2 of that Schedule to apply to a specified scheme or any scheme of a specified description;

(c) limit the scope of the exemption given to a person by virtue of an entry in Part 1 or 2 of that Schedule, whether in relation to carrying out ADR or making special ADR arrangements (or both).

(4) For the purposes of subsection (3)—

(a) descriptions of ADR may be framed by reference to kinds of ADR or types of dispute (or both), and

(b) descriptions of special ADR arrangements may be framed by reference to any features of such arrangements, including in particular the kinds of ADR involved or the types of dispute involved (or both).

(5) Subject to any limitation on its scope provided for by Schedule 25—

(a) an exemption given to a person by virtue of an entry in Part 1 of that Schedule covers anything done by the person in the exercise of the person’s functions that would otherwise be prohibited, and

(b) an exemption given to a person by virtue of an entry in Part 2 of that Schedule covers anything done under or for the purposes of an exempted redress scheme that would otherwise be prohibited.

(6) In this section—

• “prohibited” means prohibited by section 293(1) or (2);

• “specified” means specified in the regulations.

(7) Regulations under subsection (2) are subject to the negative procedure.

Accreditation: procedure etc

296 Applications for accreditation or variation of accreditation

(1) A person who wishes to be an accredited ADR provider must—

(a) apply to the Secretary of State for accreditation to enable the person to carry out ADR or to make special ADR arrangements (or to do both), and

(b) pay to the Secretary of State the appropriate application fee (if any) prescribed by regulations under section 300.

(2) An application for accreditation to carry out ADR may be limited to one or more particular descriptions of ADR.

(3) An application for accreditation to make special ADR arrangements may be limited to one or more particular descriptions of special ADR arrangements.

(4) An accredited ADR provider may apply to the Secretary of State for their accreditation to be varied by the addition, variation or removal of—

(a) any limitation affecting the descriptions of ADR or special ADR arrangements (as the case may be) covered by the accreditation, or

(b) any condition on the accreditation.

(5) An application under subsection (4) must be accompanied by the appropriate application fee (if any) prescribed by regulations under section 300.

(6) The Secretary of State may determine the procedure to be followed in relation to an application for accreditation or an application for the variation of an accreditation.

(7) The matters which may be determined under subsection (6) include (among other things)—

(a) the form in which applications are to be made;

(b) the particular descriptions of ADR for which limited accreditation may be applied for and granted;

(c) the particular descriptions of special ADR arrangements for which limited accreditation may be applied for and granted;

(d) the information to be given by applicants.

(8) Section 295(4) applies for the purposes of subsection (7) as it applies for the purposes of section 295(3).

(9) The Secretary of State must publish anything determined under subsection (6) in a manner likely to come to the attention of potential applicants for accreditation.

(10) The powers of the Secretary of State under subsection (6) may be exercised differently for different purposes.

297 Determination of applications for accreditation or variation of accreditation

(1) This section applies where an application for accreditation, or for the variation of an accreditation, has been made to the Secretary of State (and has not been withdrawn).

(2) In the case of an application for accreditation, the Secretary of State must, as soon as is reasonably practicable—

(a) consider the application,

(b) decide whether—

(i) to grant the accreditation applied for,

(ii) to grant a more limited accreditation, or

(iii) to refuse the application, and

(c) give notice in writing to the applicant of the decision and, in the case of a decision mentioned in paragraph (b)(ii) or (iii), the reasons for the decision.

(3) Accreditation granted under subsection (2)(b)(ii) may be limited to such descriptions of ADR or such descriptions of special ADR arrangements (or both) as the Secretary of State considers appropriate and specifies in the accreditation.

(4) If accreditation is granted, the Secretary of State may also decide to impose conditions on the accreditation.

(5) The Secretary of State may only grant accreditation if satisfied that the accreditation criteria will be met by or in relation to the applicant after accreditation is granted.

(6) An accreditation is not time limited unless—

(a) the Secretary of State determines that it is to have effect for a limited period, and

(b) the notice of the decision on the application states that the accreditation is time limited and specifies the period for which it has effect.

(7) The notice of a decision to grant accreditation must specify the day on which the accreditation takes effect.

(8) In the case of an application for the variation of an accreditation, the Secretary of State must, as soon as is reasonably practicable—

(a) consider the application,

(b) decide whether—

(i) to grant the application,

(ii) to vary the accreditation, but to a different extent than applied for, or

(iii) to refuse the application, and

(c) give notice in writing to the applicant of the decision and, in the case of a decision mentioned in paragraph (b)(ii) or (iii), the reasons for the decision.

(9) If the Secretary of State decides to vary the accreditation under subsection (8)(b)(i) or (ii), the Secretary of State may also decide—

(a) to impose new conditions on the accreditation, or

(b) to vary or remove any existing condition on the accreditation.

(10) The Secretary of State may only vary an accreditation if satisfied that the accreditation criteria will be met by or in relation to the applicant after the accreditation is varied.

(11) A variation of an accreditation is not time limited unless the Secretary of State determines that the variation is to have effect only for a limited period and the notice of the decision on the application for variation—

(a) states that the variation is time limited (unless made permanent following a subsequent application by the ADR provider),

(b) specifies the period for which the variation has effect, and

(c) makes provision as to the terms of the accreditation in the event that the variation lapses at the end of that period.

(12) The notice of a decision to vary an accreditation must specify the day on which the variation takes effect.

(13) Where the Secretary of State decides—

(a) to impose conditions under subsection (4), or

(b) to impose new conditions, or to remove or vary any existing condition on the accreditation, under subsection (9),

the notice of the decision on the relevant application must set out the conditions on the accreditation or the accreditation as varied, and give the Secretary of State’s reasons for the decisions made under subsection (4) or (9) (as the case may be).

(14) Where an accreditation covers the making of special ADR arrangements, conditions on the accreditation may be framed so as to secure that the accredited ADR provider is responsible for acts or omissions of other ADR providers who carry out ADR under special ADR arrangements made by the accredited ADR provider.

298 Revocation or suspension of accreditations etc

(1) This section confers powers on the Secretary of State in relation to the accreditation of an accredited ADR provider.

(2) The Secretary of State may, by notice to the ADR provider, revoke the accreditation on the application of the ADR provider.

(3) Subsection (4) applies in relation to the ADR provider where the Secretary of State considers that any one or more of the following conditions are met—

(a) the ADR provider is contravening, or has contravened, any of the prohibitions in section 293 and 294;

(b) the ADR provider is failing, or has failed, to comply with any of the accreditation criteria;

(c) the ADR provider is failing, or has failed, to comply with any conditions on its accreditation;

(d) the ADR provider is failing, or has failed, to comply with an enforcement notice under section 302.

(4) The Secretary of State may by notice to the ADR provider—

(a) vary the accreditation, by doing either or both of the following—

(i) limiting, or further limiting, the accreditation to such descriptions of ADR or such descriptions of special ADR arrangements (or both) as the Secretary of State considers appropriate, and

(ii) imposing new conditions on the accreditation, varying any existing condition or removing any existing condition,

(b) suspend the accreditation, or

(c) revoke the accreditation.

(5) In subsection (4)(a)(i) the reference to limiting (or further limiting) the accreditation to particular descriptions of ADR or of special ADR arrangements includes, in particular, limiting it to ADR relating to consumer contract disputes that have already been referred for ADR or to special ADR arrangements that already exist (as the case may be), whether for a limited period or otherwise.

(6) Before giving such a notice the Secretary of State must give the ADR provider a reasonable opportunity to make representations as to—

(a) whether one or more of the conditions mentioned in subsection (3) are met in relation to the ADR provider, and

(b) if so, what action (if any) it is appropriate for the Secretary of State to take under subsection (4).

(7) Any variations made under subsection (4)(a) must be variations the Secretary of State considers necessary to secure compliance with the prohibitions in sections 293 and 294, the accreditation criteria, the existing conditions on the accreditation or the enforcement notice (as the case may be).

(8) In subsection (7) “existing conditions” means the existing conditions disregarding any previous variations made under subsection (4)(a) or (9)(b).

(9) Where variations of the accreditation are made under subsection (4)(a), the Secretary of State must—

(a) keep those variations under review, and

(b) by notice to the ADR provider vary the accreditation for the purpose of revoking or reversing the effect of all or any of the variations, to the extent that the Secretary of State considers that they are no longer necessary for the purpose set out in subsection (7).

(10) A notice that the accreditation is being varied must specify the day on which the variations take effect.

(11) A notice that the accreditation is suspended or revoked must specify the day on which the accreditation ceases to be in force.

(12) Where the accreditation is suspended the notice must also set out when or in what circumstances the suspension is to cease to have effect so that the accreditation is again in force.

(13) The provision required by subsection (12) may consist of any one or more of the following—

(a) provision for the suspension to cease to have effect at the end of a period specified in the notice,

(b) provision for it to cease to have effect on the satisfaction of conditions specified in the notice, and

(c) provision for it to cease to have effect when a decision to lift it is made by the Secretary of State and notified to the ADR provider.

299 Fees payable by accredited ADR providers

(1) Accredited ADR providers must pay to the Secretary of State, at such times as may be prescribed, the appropriate prescribed fee (if any).

(2) In subsection (1) “prescribed” means prescribed by regulations under section 300.

300 ADR fees regulations

(1) The Secretary of State may by regulations make provision about the following descriptions of fees, namely—

(a) fees to be paid by applicants for accreditation under section 296(1);

(b) fees to be paid by applicants for the variation of their accreditation under section 296(5);

(c) fees to be paid by accredited ADR providers under section 299(1).

(2) The power to make provision about a description of fees includes power to provide—

(a) for fees of different specified amounts to be payable in different cases or circumstances;

(b) for cases or circumstances in which no fees are to be payable;

(c) in the case of fees to be paid under section 299, the times at which the fees are to be paid.

(3) In making regulations under this section the Secretary of State must have regard to the need to secure that, taking one year with another—

(a) the total amount of fees paid does not exceed the costs to the Secretary of State of carrying out functions under this Chapter;

(b) the total amount of fees paid under section 296(1) does not exceed the costs to the Secretary of State of processing and determining applications for accreditation;

(c) the total amount of fees paid under section 296(5) does not exceed the costs to the Secretary of State of processing and determining applications for the variation of an accreditation.

(4) Regulations under this section are subject to the negative procedure.

301 Accreditation criteria

(1) For the purposes of this Chapter the accreditation criteria are the criteria set out in Schedule 26.

(2) The Secretary of State may by regulations amend Schedule 26 for the purpose of—

(a) adding a new criterion, or

(b) removing or varying any criterion for the time being set out in that Schedule.

(3) Regulations under subsection (2) are subject to the affirmative procedure.

Enforcement of prohibitions etc

302 Enforcement notices

(1) The Secretary of State may give an enforcement notice to an ADR provider if satisfied that the provider is contravening, or has contravened, any one or more of the following—

(a) the prohibition in section 293(1) or (2);

(b) the prohibition in section 294(1) or (3);

(c) a condition on its accreditation;

(d) the duty to pay a fee due under section 299(1);

(e) a duty imposed by regulations under section 303;

(f) a duty imposed by a direction under section 304.

(2) Before reaching a final view as to whether or not to give an enforcement notice to an ADR provider, the Secretary of State must give the provider a reasonable opportunity to make representations as to—

(a) whether the condition in subsection (1) is met, and

(b) if so, whether an enforcement notice should be given to it.

(3) An enforcement notice is a notice requiring the ADR provider in question to do, or not to do, such things as are specified in the notice or are of a description so specified, with a view to securing compliance with the prohibition, condition or duty in question.

(4) An enforcement notice may—

(a) include requirements for the ADR provider to give information to the Secretary of State, or

(b) include other supplementary, incidental or consequential provision.

(5) The notice must make clear, in particular—

(a) what requirements are being imposed by the notice, and

(b) when they are to be complied with (whether immediately or otherwise).

(6) The Secretary of State may, by notice to the ADR provider to whom an enforcement notice has been given—

(a) revoke the enforcement notice, or

(b) revoke any requirement contained in the notice and, if necessary, make any consequential changes to the other provisions of the notice.

(7) The power under subsection (6) may be exercised on the application of the ADR provider or otherwise.

(8) An enforcement notice may, with the permission of the High Court or the Court of Session, be enforced as if it were an order made by that court.

(9) The Secretary of State may publish information about enforcement notices given under this section.

Provision of Information etc

303 ADR information regulations

(1) The Secretary of State may by regulations require persons of a specified description (being persons within subsection (2))—

(a) to provide ADR information to the Secretary of State;

(b) to provide ADR information to a person with functions conferred by regulations under section 307;

(c) to provide ADR information to consumers by publishing it.

(2) Regulations under this section may impose requirements on—

(a) accredited ADR providers,

(b) exempt ADR providers,

(c) persons (not being accredited or exempt ADR providers) who carry out ADR under special ADR arrangements,

(d) persons who have been, but are no longer, within paragraph (a), (b) or (c),

(e) regulators, but only in relation to relevant ADR information (see section 306(2)).

(3) The power to impose requirements under subsection (1)(a) or (b) may only be exercised for the purpose of enabling or facilitating one or more of the following—

(a) publication of ADR information for the benefit of consumers;

(b) monitoring or evaluation of the operation of the system of accreditation under this Chapter;

(c) monitoring or evaluation of the provision and quality of ADR carried out in the United Kingdom.

(4) It is immaterial for the purposes of subsection (3) whether the publication, monitoring or evaluation is carried out by the Secretary of State, by a person with functions conferred by regulations under section 307 or by any other person acting under arrangements made with that other person by the Secretary of State or a person with such functions.

(5) Regulations under this section may provide for—

(a) the ADR information to be provided or published;

(b) the manner in which it is to be provided or published;

(c) the intervals or times at which it is to be provided or published;

(d) time limits for providing or publishing it.

(6) Regulations under this section are subject to the negative procedure.

304 ADR information directions

(1) The Secretary of State may give a direction to any person falling within subsection (2) requiring the person to provide ADR information to the Secretary of State.

(2) A direction may be given to—

(a) an accredited ADR provider,

(b) an exempt ADR provider,

(c) a person (not being an accredited or exempt ADR provider) who carries out ADR under special ADR arrangements,

(d) a person who has been an accredited or exempt ADR provider or a person mentioned in paragraph (c), or

(e) a regulator, but only in relation to relevant ADR information (see section 306(2)).

(3) A direction may only be given—

(a) for the purpose of enabling or facilitating one or more of the following (whether done by the Secretary of State or by another person under arrangements made with the Secretary of State)—

(i) publication of ADR information for the benefit of consumers;

(ii) monitoring or evaluation of the operation of the system of accreditation under this Chapter;

(iii) monitoring or evaluation of the provision and quality of ADR carried out in the United Kingdom, or

(b) for any other purpose connected with the exercise of the Secretary of State’s functions under this Chapter.

(4) A direction may provide for—

(a) the ADR information to be provided;

(b) the manner in which it is to be provided;

(c) time limits for providing it.

(5) A person to whom a direction is given must so far as reasonably practicable comply with it.

(6) The duty to comply with a direction is enforceable by the Secretary of State in civil proceedings—

(a) for an injunction,

(b) for specific performance of a statutory duty under section 45 of the Court of Session Act 1988, or

(c) for any other appropriate remedy or relief.

(7) In this section “direction” means a direction under this section.

305 Disclosure of ADR information by the Secretary of State

(1) This section applies to any ADR information relating to ADR providers which—

(a) is provided to the Secretary of State in response to regulations under section 303 or a direction under section 304, or

(b) is otherwise held by the Secretary of State for the purposes of any function of the Secretary of State under this Chapter.

(2) The Secretary of State may publish information to which this section applies for the purpose of providing information to consumers.

(3) The Secretary of State may disclose information to which this section applies—

(a) to any Minister of the Crown, government department or devolved authority;

(b) to a regulator;

(c) to a public designated enforcer (see section 151).

(4) This section does not affect any power to disclose information apart from this section.

(5) In this section “devolved authority” means the Welsh Ministers, the Scottish Ministers or a Northern Ireland Department.

306 Meaning of “ADR information” and other terms in sections 303 to 305

(1) In sections 303 to 305 “ADR information” means any information about or relating to—

(a) an ADR provider,

(b) ADR carried out by an ADR provider,

(c) special ADR arrangements made by an ADR provider.

(2) In those sections “relevant ADR information”, in relation to requirements imposed on a regulator, means any information about or relating to—

(a) ADR carried out by a relevant ADR provider,

(b) special ADR arrangements made by a relevant ADR provider,

(c) ADR carried out by ADR providers acting under special ADR arrangements made by a relevant ADR provider, or

(d) anything done by the regulator which directly or indirectly affects a relevant ADR provider so far as relating to anything falling within paragraphs (a) to (c).

(3) In subsection (2) “relevant ADR provider”, in relation to a regulator, means an accredited or exempt ADR provider—

(a) who is subject to regulation by the regulator, or

(b) whose activities (as an ADR provider) relate to consumer contract disputes involving traders acting in an area for which the regulator has responsibility or oversight under any legislation.

(4) In this section—

(a) a reference to information about ADR carried out by an ADR provider includes, in the case of ADR carried out by an accredited or exempt ADR provider, information about fees charged to consumers or traders in respect of carrying out ADR, and

(b) a reference to information about special ADR arrangements includes information about fees charged to consumers or traders by the ADR provider who made the arrangements.

(5) In this section references to ADR carried out by an ADR provider include ADR to be carried out by the provider.

(6) In this section and sections 303 to 305, “regulator” means a person who has responsibility for, or oversight of, an area of activity by virtue of any legislation.

Involvement of other bodies in the regulation of ADR providers

307 Power to provide for other persons to have accreditation functions etc

(1) The Secretary of State may by regulations make provision for or in connection with the conferring on another person of any function falling within subsection (2) so far as it is exercisable in such cases or circumstances as may be prescribed by the regulations, in place of the corresponding function of the Secretary of State.

(2) The functions which may be the subject of regulations under this section are functions corresponding to functions of the Secretary of State under the following provisions of this Chapter as originally enacted—

• section 294(2)(b) (function of approving fees provisions);

• section 296 (functions relating to applications for accreditation or variation of an accreditation);

• section 297 (functions relating to determination of applications);

• section 298 (functions relating to revocation or suspension of accreditations etc);

• section 299(1) (fees payable by accredited ADR providers), so far as relating to the function of receiving fees;

• section 302 (functions relating to enforcement notices);

• section 304 (functions relating to ADR information directions);

• section 305 (functions relating to disclosure of ADR information).

(3) The powers conferred by subsection (1) include power to make provision for or in connection with—

(a) sharing of information between any two or more relevant authorities;

(b) abolishing (in whole or part) a function conferred on a person by regulations under this section.

(4) In subsection (3)(a) “relevant authorities” means the Secretary of State and any persons with functions conferred by regulations under this section.

(5) Regulations under this section may amend this Chapter.

(6) Regulations under this section are subject to the affirmative procedure.

Complaints by consumers to traders

308 Duty of trader to notify consumer of ADR arrangements etc

(1) This section applies where a trader responds to a complaint from a consumer in respect of any matters relating to a consumer contract between them.

(2) In subsection (1) “matters relating to a consumer contract” include anything concerning—

(a) the making of the contract,

(b) anything done by the trader before or after making the contract,

(c) any obligations of the trader under or relating to the contract, or

(d) the performance by the trader of its obligations under or relating to the contract.

(3) The trader must, when communicating the outcome of the trader’s consideration of the complaint to the consumer, also inform the consumer about any ADR or other arrangement that is available if the consumer is dissatisfied with the outcome.

(4) In subsection (3) “ADR or other arrangement” means a scheme or arrangement—

(a) that is available to the consumer by virtue of an obligation of the trader to participate in the scheme or arrangement imposed by—

(i) legislation,

(ii) terms of the consumer contract, or

(iii) other contractual arrangements to which the trader is party, and

(b) by virtue of which either or both of the following will happen if the complaint (or any part of it) is duly pursued by the consumer—

(i) ADR will be carried out (if or so far as the matters complained of involve a consumer contract dispute between the parties);

(ii) other action will be taken with a view to securing or facilitating a resolution (if or so far as the matters complained of do not involve a consumer contract dispute between the parties).

(5) Section 302 (enforcement notices) applies in relation to a trader who is contravening or has contravened the duty under subsection (3) as it applies in relation to an ADR provider who is contravening or has contravened anything mentioned in section 302(1).

(6) This section does not affect any other duty of a trader to give information to a consumer.

Consequential amendments etc and transitional provision

309 Consequential amendments etc relating to this Chapter

Schedule 27 contains consequential amendments, repeals and revocations relating to this Chapter.

310 Transitional provision relating to this Chapter

(1) The prohibition on carrying out ADR in section 293(1) does not apply to ADR carried out by an ADR provider in relation to a consumer contract dispute where the ADR started before the prohibition came into force.

(2) The prohibition on charging fees to consumers in section 294(1) does not apply to ADR carried out by an ADR provider in relation to a consumer contract dispute where the ADR started before the prohibition came into force.

(3) For the purposes of subsections (1) and (2), the ADR is to be taken as starting when the dispute was first referred to the ADR provider in accordance with that provider’s rules or procedures.

(4) The prohibition on charging fees to consumers in section 294(3) does not apply to ADR carried out by an ADR provider under special ADR arrangements where the ADR started before the prohibition came into force.

(5) Subsection (2) of section 293 applies, in the case of any special ADR arrangements made by an ADR provider before that subsection comes into force, as if the prohibition in it were a prohibition against the person who made the arrangements continuing to operate them, unless that person—

(a) is an exempt ADR provider whose exemption would cover making the special ADR arrangements, or

(b) is an accredited ADR provider whose accreditation would cover making the special ADR arrangements.

(6) But subsection (5) does not prevent the person from continuing to operate the special ADR arrangements so far as relating to cases in which ADR which is being carried out in relation to a consumer contract dispute started before the prohibition in section 293(1) came into force.

(7) For the purposes of subsections (4) and (6) ADR is to be taken as starting when the dispute is referred—

(a) to the person who made the special ADR arrangements in accordance with the person’s rules or procedures, or

(b) to the person carrying out the ADR under the special ADR arrangements, in accordance with the person’s rules or procedures,

whichever occurs first.

(8) The duty in section 308(3) does not apply in relation to a consumer’s complaint if it was received by the trader before the coming into force of section 308.