CONSUMER ALTERNATIVE DISPUTE RESOLUTION (RESIDUAL ADR) REGULATIONS (residualadr)

SUBSIDIARY LEGISLATION 378.19

CONSUMER ALTERNATIVE DISPUTE

RESOLUTION (RESIDUAL ADR) REGULATIONS

14th February, 2017

LEGAL NOTICE 56 of 2017, as amended by Legal Notice 215 of 2021.

PART I

Preliminary

The title of these regulations is the Consumer Alternative

Dispute Resolution (Residual ADR) Regulations.

(1) Any reference in these regulations to the "Act" is a

reference to the Consumer Affairs Act, and the provisions of

articles 2 and 43A of the said Act shall apply to these regulations

provided that the definitions contained in sub-regulation (2) shall

in all instances for the purposes of these regulations prevail.

(2)

In these regulations, unless the context otherwise requires

"ADR" means alternative dispute resolution;

"ADR entity" means any entity, however named or referred to,

which is established on a durable basis and offers the resolution of

a dispute through an ADR procedure and that is listed in

accordance with regulation 20 of the Consumer Alternative Dispute

Resolution (General) Regulations;

"ADR officer" means a natural person in charge of the ADR

process;

"ADR procedure" means a procedure, as referred to in regulation

3 of the Consumer Alternative Dispute Resolution (General)

Regulations, which complies with the requirements set out under

the aforementioned regulations and is carried out by an ADR

entity;

"Board" means the Board of Governors established under article

8 of the Malta Competition and Consumer Affairs Authority Act;

"CCD" means the Complaints and Conciliation Directorate

established under the Fourth Schedule of the Malta Competition

and Consumer Affairs Authority Act;

"Chairman" means the Chairman of the Board and of the Malta

Competition and Consumer Affairs Authority appointed in terms of

article 9(1) of the Malta Competition and Consumer Affairs

Authority Act;

"conflict of interest" means that situation in which ADR officers

have private or personal interests sufficient to influence or appear

to influence their independence or impartiality;

"Council" means the Consumer Affairs Council established

under Part II of the Consumer Affairs Act;

"cross-border dispute" means a contractual dispute arising from a

sales or services contract where, at the time the consumer orders

the goods or services, the consumer is resident in a Member State

other than the Member State in which the trader is established;

"Director General (Consumer Affairs)" means the person so

appointed by virtue of article 16(2) of the Malta Competition and

Consumer Affairs Authority Act;

"domestic dispute" means a contractual dispute arising from a

sales or service contract where, at the time the consumer orders the

goods or services, the consumer is resident in the same Member

State as that in which the trader is established;

"ODR Platform" means the online dispute resolution platform

established under Regulation (EU) No 524/2013 of the European

Parliament and of the Council of 21 May 2013 on online dispute

resolution for consumer disputes and amending Regulation (EC)

No 2006/2004 and Directive 2009/22/EC (Regulation on consumer

ODR);

"residual ADR entity" means any such entity as the Minister

may, after consultation with the Council, designate to deal with any

disputes that consumers may have with traders in relation to which

there is no existing ADR entity in place competent to deal with

such disputes;

"trader" means any natural person or any legal person,

irrespective of whether privately or publicly owned, who is acting,

including through any other person acting in his name or on his

behalf, for purposes relating to his trade, business, craft or

profession.

(3)

A trader is established

(a) if the trader is a natural person where he has his place

of business; and

(b) if the trader is a company or other legal person or

association of natural or legal persons, where it has its

statutory seat, central administration or place of

business, including a branch, agency or any other

establishment.

(4)

An ADR entity is established

(a) if it is operated by a natural person, at the place where

it carries out ADR activities; or

(b) if the entity is operated by a legal person or association

of natural or legal persons, at the place where that

legal person or association of natural or legal persons

carries out ADR activities or has its statutory seat; or

(c) if it is operated by an authority or other public body, at

the place where the authority or other public body has

its seat.

The CCD shall be the public entity designated to perform

the functions of a residual ADR entity.

(1) The CCD shall take cognizance of domestic and cross-

border disputes concerning contractual obligations resulting from

sales contracts or service contracts between a trader established in

the European Union and a consumer resident in the European

Union and shall intervene to bring the parties together with the aim

of facilitating or proposing a solution.

(2)

The CCD shall not take cognizance of disputes in relation

to

(a) non-economic services of general interest;

(b) disputes between traders;

(c) direct negotiation between the consumer and the

trader;

(d) procedures initiated by a trader against a consumer;

(e) health services provided by health professionals to

patients to assess, maintain or restore their state of

health, including the prescription, dispensation and

provision of medicinal products and medical devices;

and

(f)

the public provision of further or higher education;

(1) The CCD may refuse to accept a given dispute on the

ground that

(a) the consumer did not attempt to contact the trader

concerned in order to discuss his compliant and seek,

as a first step, to resolve the matters directly with the

trader;

(b) the dispute is frivolous or vexatious;

(c) the dispute is being or has previously been considered

by another ADR entity or by a competent court or

tribunal;

(d) the consumer has not submitted the complaint to the

CCD within two (2) years from the date upon which

the consumer submitted the complaint to the trader;

(e) dealing with such a dispute would otherwise seriously

impair the effective operation of the CCD.

(2) For the purposes of paragraphs (a) and (d), the CCD may

require the consumer to prove by adequate means that he had, prior

to lodging his complaint with the CCD, attempted to resolve the

matter directly with the trader.

(3) Without prejudice to the provisions of sub-regulation (1),

where the CCD is unable to consider a dispute that has been

submitted to it, it shall provide all the parties to the dispute with a

reasoned written explanation of the grounds for not considering the

dispute within three (3) weeks of receiving the complaint.

(4) Under no circumstances shall the ADR process prevent any

person from exercising the right of access to the judicial system.

Unless stated otherwise in these regulations, if any

provision of these regulations conflicts with a provision laid down

in any other national law, the provisions of these regulations shall

prevail.

PART II

The ADR officers

(1) The ADR officers in charge of the ADR process shall be

appointed by the Minister. A person shall not be qualified to be

appointed as ADR Officer unless he holds the warrant and has

practised as an advocate in Malta for a period or periods amounting in

the aggregate to not less than five years.

(1A) A person shall be disqualified to be appointed ADR officer

if such person –

(a) is a member of the House of Representatives; or

(b) is a member of a Local Council; or

(c) is a trader; or

(d) is an undischarged bankrupt; or

(e) has been sentenced by any court to imprisonment for

any term or has been found guilty by any court of any

of the crimes in Titles III, V or VI of Part II of Book

First of the Criminal Code.

(2) The ADR officers shall receive such remuneration as the

Minister may by notice in the Gazette determine; and such

remuneration shall be a charge on the Consolidated Fund; such

remuneration shall not during the tenure of office of an ADR officer be

altered to his disadvantage.

(2A) During the term of their appointment, ADR officers shall

be precluded from the exercise of their profession in any ADR

process whether residual or otherwise.

(2B) The ADR officers shall be appointed for a term of three

years and shall be eligible to be re-appointed, for a further term or

terms of three years each.

(2C) Every person appointed as an ADR officer shall not assume

the duties of his office unless and until he has taken before the State

Advocate an oath to exercise his functions in the ADR processes for

which he is in charge, without delay, and with impartiality and equity

according to law.

(3) In the exercise of his functions under this regulation, an ADR

officer shall not be subject to the control or direction or instructions of

either party or their representative or of any other person or authority,

and may not be removed from office except by the Court of Appeal on

an application for that purpose by the Minister on the grounds of

misbehaviour or inability to perform his functions by reason of

infirmity of body or mind.

(4) The ADR officers shall assist the parties to reach a

resolution that is timely, fair and cost-effective.

(5) The ADR officers may, in conducting the ADR process,

refer to codes of conduct, legal provisions and relevant

jurisprudence, and may use as a basis for the dispute resolution,

considerations of equity and fairness.

(6) The ADR officer in charge of the ADR process shall

disclose to the CCD any circumstances that may or may be seen to

affect his independence and impartiality or give rise to a conflict of

interest with either party to the dispute he is asked to resolve. The

obligation to disclose such circumstances shall be a continuing

obligation throughout the ADR procedure

Provided that the ADR officer shall be allowed to continue

the ADR process if the parties have not objected after they have

been duly informed of the circumstances and their right to object.

(7) Without prejudice to the provisions of the preceding sub-

regulation, an ADR officer shall abstain from assisting the parties

to reach a resolution to their dispute

(a) if he is the spouse of any of the parties or if he is

related to any of the parties by consanguinity or

affinity in the direct line up to any degree or in the

collateral line up to the degree of cousin inclusively;

(b) if he is the tutor, curator, or presumptive heir of any of

the parties;

(c) if he is or has been the agent of any of the parties;

(d) if he is the administrator of any establishment or

partnership involved in the ADR process; or

(e) if he has or might have a personal interest in the

outcome of the ADR process.

PART III

Procedure relative to the ADR process

(1) In the absence of an agreement to the contrary, the

participation of both the consumer and the trader in the ADR

process shall be on a voluntary basis

Provided that any agreement between a consumer and a

trader to submit complaints to the CCD is not binding on the

consumer if it was concluded before the dispute has materialised

and if it has the effect of depriving the consumer of his right to

bring an action before the competent courts or tribunals for the

settlement of the dispute.

(2) The parties may withdraw from the ADR procedure at any

sta ge an d fo r an y reas on w h at soe ver, i nc lu di n g i f t hey are

dissatisfied with the performance or the operation of the procedure

and the ADR officer shall, prior to commencing the ADR procedure

inform the parties of such right.

The CCD shall offer the ADR free of charge.

The CCD shall allow complaints to be submitted, and shall

conduct the ADR process in either the Maltese or English

language

Provided that where any party does not understand the

language in which the ADR process is being conducted, such

process shall be interpreted to him by the ADR officer.

The CCD shall ensure that the ADR procedure is available

and easily accessible online and offline.

The parties shall not be obliged to retain a lawyer or a legal

advisor, but they may seek independent advice or to be represented

or assisted by a third party at any stage of the procedure.

(1) The CCD shall upon receiving all the documents

which include the relevant information relating to the complaint

notify the parties to the dispute with the date, time and place for the

first ADR session.

(2) Without prejudice to the provisions of the preceding

regulation, the parties or their representatives shall appear on the

date and time and at the place indicated in the notification

Provided that in the case of disputes referred through the

ODR Platform, the physical presence of the parties or their

representatives shall not be required.

(3) The outcome of the ADR shall be made available to the

parties by means of a report formulated by the ADR officer

conducting the ADR process and which shall contain

(a) a summary of the events which gave rise to the

dispute;

(b) a copy of the documents received which include the

relevant information relating to the dispute;

(c) the minutes of each ADR session forming part of the

ADR process;

(d) the outcome in the form of a proposed solution to the

dispute; and

(e) a statement of the grounds on which the outcome is

based.

(4)

The outcome of the ADR procedure shall be made

available to the parties within a period of ninety (90) calendar days

from the date on which the CCD has received the complete

complaint file

Provided that in the case of highly complex disputes, the

CCD may, at its own discretion, extend the ninety (90) calendar

day’s time period, in which case, the parties shall be informed of

any extension of that period and of the expected length of time that

will be needed for the conclusion of the dispute.

Any agreement relating to the ADR process shall be made

in writing in the presence of an ADR officer and shall, for all

intents and purposes of the law be considered a private writing.

(1) The CCD shall ensure that throughout the ADR

process

(a) the parties have the possibility, within a reasonable

period of time, of expressing their point of view and of

submitting evidence including documents and opinions

of experts in so far as relevant to the dispute and to be

provided with the arguments, evidence, documents and

facts put forward by the other party or parties, any

statements made and opinions given by experts and of

being able to comment on them;

(b) the parties are informed that they are not obliged to

retain a lawyer or a legal advisor, but they may seek

independent advice or to be represented or assisted by

a third party at any stage of the procedure;

(c) the parties are provided with a report on the outcome

of the ADR in writing or on a durable medium, which

shall contain a statement of the grounds on which the

outcome is based.

(2) The parties, before agreeing to a proposed solution shall be

informed that

(a) they have the choice as to whether or not to agree to or

follow the proposed solution;

(b) participation in the procedure does not preclude the

possibility of seeking redress through proceedings in a

competent court or tribunal;

(c) the proposed solution may be different from an

outcome determined by a competent court or tribunal

applying legal rules.

(3) The parties, before agreeing to or following a proposed

solution or an amicable solution, should be informed of the legal

effects of agreeing to or following such a proposed solution.

(4) The parties, shall, before expressing their written consent to

the proposed solution, be allowed a period of not less than three (3)

days to reflect.

(5) In establishing the period of time referred to in the

preceding sub-regulation, regard shall be had to the specific nature

and circumstances of the dispute.

The participation in the ADR process shall not prevent the

parties from initiating judicial proceedings in relation to that

dispute as a result of the expiry of limitation or prescription periods

as provided under any provision of national law during the ADR

procedure

Provided that this regulation shall be without prejudice to

provisions on limitation or prescription contained in international

agreements to which Malta is a party.

Any communication or discussion made during the ADR

process as well as the content of the agreement resulting from the

ADR process shall be treated as confidential

CONSUMER ALTERNATIVE DISPUTE RESOLUTION

(RESIDUAL ADR)

Provided that disclosure of the content of the agreement

resulting from the ADR process shall be permitted

(a) where this is necessary for overriding considerations

of public policy;

(b) where such disclosure is necessary in order to

implement or enforce the agreement resulting from the

ADR process;

(c) where the existence of the agreement or a term or

clause therein is being denied by the other party;

(d) where all parties expressly agree in writing to the

disclosure of the content of the agreement resulting

from the ADR process; or

(e) where this is required by an authority, court or

competent tribunal of a Member State.