In July 2011, the European Parliament published a draft report on the Commission's consultation earlier this year entitled "Towards a coherent European approach on collective redress", which contains a section on ADR in the context of collective redress. The report can be viewed here.

The report notes that the European Parliament encourages the setting-up of ADR schemes at European level so as to allow fast and cheap settlement of disputes as a more attractive option than court proceedings, and calls for a legal obligation for the parties involved first to seek a collective consensual resolution of the claim before launching collective court proceedings. The report notes that certain criteria will be required in order for such a mandatory settlement procedure to be compatible with the right to effective judicial protection. A starting point for such a procedure is the criteria laid down by the European Court of Justice in Alassini v Telecom Italia SpA (Joined Cases C-317-320/08) [2010] 3 C.M.L.R. 17 ECJ:

  • The ADR procedure must not result in a decision which is binding on the parties;
  • It must not cause a substantial delay for the purposes of bringing legal proceedings;
  • It must suspend the period for the time-barring of claims;
  • It must not give rise to costs for the parties;
  • Electronic means must not be the only means by which the settlement procedure may be accessed; and
  • Interim measures must be possible in exceptional cases where the urgency of the situation so requires.

The explanatory memorandum to the report notes that the proposal on ADR expected from the European Commission in late 2011 should form the starting point for developing such a mechanism.