The American Arbitration Association (AAA) has overhauled its Consumer Rules to spell out in greater detail the procedures that will govern their consumer arbitrations. As part of its overhaul, the AAA has mandated that, as of September 1, 2014, businesses that include arbitration clauses in consumer contracts must submit their clauses for review and registration with the AAA’s new Consumer Clause Registry. The Registry was created to provide additional access to information about the AAA’s consumer arbitration services and to list businesses that are authorized to enlist AAA’s services. Beginning September 1, AAA will not arbitrate any claim pursuant to an arbitration clause, unless that clause has been registered and reviewed for a fee.
Businesses will be required to submit their consumer arbitration clause to the AAA for review and determination that the clause substantially and materially complies with the due process standards of the AAA’s consumer Due Process Protocol and the amended Consumer Rules. A business and its arbitration clause will only be included in the Registry after the AAA reviews a submitted clause, receives the required fee and determines that it will arbitrate a consumer-related dispute under the clause. The AAA will consider whether the arbitration clause satisfies the principals designed to ensure fair treatment of consumers under the business’s arbitration policy before approving it and making it available on the Registry. These principals include fair process, access to information regarding alternative dispute resolution, independent administration, reasonable cost and the right to representation among others. If a clause does not comply with AAA procedures, the AAA will decline to administer the consumer arbitration. Even if a business uses a standard form arbitration agreement issued by a forms provider, the business must register that form agreement.
Businesses must pay a fee of $650 to be reviewed and registered in 2014. The fee drops to $500 for clauses submitted in 2015. AAA will charge an annual renewal fee of $500 per clause per year starting in 2016. Each variation of the business’s arbitration clause must be registered separately. If a business has not registered its consumer clause prior to the filing of a consumer case, the AAA will require that the business register its clause at that time for an additional fee of $250 for an expedited review. Additionally, any subsequent revisions to a currently registered arbitration clause must be resubmitted for review. A fee of $500 will be assessed to review such revisions.
Consumers can access the Registry to search businesses by name to determine if the AAA has reviewed the business’s consumer arbitration clause and will administer their consumer arbitrations. The Registry will also include on-line access to the arbitration clause reviewed by the AAA and may also include other documents related to the arbitration clause for consumers’ access. Additional information on the new Consumer Rules is available at: www.adr.org.