Address by Mr. Tom Kitt, T.D., Minister for Consumer Affairsat the Launch of a Project Aimed at Developing an On-LineSmall Claims Procedure on a Pilot Basis, on 18th December, 2000.

Introduction I am very pleased to have the opportunity here today to launch this initiative, which aims to develop an on-line Small Claims Procedure on a pilot basis. It is a collaborative effort between my Department, the Department of Justice, Equality and Law Reform, and the Courts Service.

Development of the pilot project is set in the context of the Government’s policy to promote e-Government and e-commerce generally. Funding is being provided under the Government’s Information Society Action Plan. There is also a wider, European dimension: A new strategy has now been formulated at EU level to generate consumer e-confidence, using a Community-wide network of alternative dispute resolution bodies, known as the EEJ-Net (that is, the European Extra Judicial Network), to settle consumer disputes.

E-Government and e-commerce The information communication technologies (ICT) revolution is transforming the way we, as citizens, live and work. ICTs are transforming the way Government Departments and agencies interact with citizens. As a result, the e-Ireland agenda is being progressed across the spectrum of Government Departments and agencies. Close collaboration is necessary, especially if the mix of policies to deliver on the e-Ireland agenda are to be produced. There is no doubt that e-Government will, progressively, enhance citizens’ access to information and services, and speed up standard administrative processes.

To enable, promote and encourage growth in this area, a secure regulatory framework is necessary: The E-Commerce Act, 2000 - on which my Department collaborated with the Department of Public Enterprise - created a legal framework to facilitate the growth of e-business and electronic transactions in Ireland. The Copyright Act, 2000 - a substantial piece of legislation which I was heavily involved in and which comes in to force from 1st January next - puts in place a modern régime of statutory protection for copyright and related rights, including civil remedies and criminal sanctions. Our existing Data Protection laws give rights to individuals to protect them against the misuse of personal information held on computers. This legislation will be supplemented with new statutory measures which will provide additional protections, by strengthening the rights of citizens to information and to object to the processing of information.

For consumers, the pace of technological change not only provides them with access to a virtually unlimited range of consumer goods and services, which can be purchased or availed of in a wide variety of ways, but it will also have a fundamental impact on their transactional behaviour. The ICT revolution can therefore be expected to have profound implications for the future profile of consumer protection. And wearing my Consumer Affairs Minister’s hat I wish to emphasise how determined I am that we use e-Government to its fullest possible extent to progress consumer objectives in relation to information, representation and redress.

The European dimension There is a strong European dimension to our work here. Commissioner Byrne has been promoting a framework for resolving Business-to - Consumer disputes (or B2C to use the jargon) - and, in fact, he has given promotion of the small claims procedure as an example of the possible way forward. He had identified consumer mistrust of e-commerce as a transactional medium to be an important barrier to the completion of the Single On-line Market. He therefore proposed a new European approach to generating consumer e-confidence.

The Commissioner’s strategy - which I have wholeheartedly supported - envisages, as a first step in creating a comprehensive redress system, the development of a range of alternative dispute resolution (ADR) mechanisms, and linking up a network of existing ADR schemes in the EU Member States. Disputes could be resolved by the ADR body in the country of origin of the business, but consumers would have the reassurance of knowing that they could access that body from their own Member State via the EEJ-Net. Consumers could, of course, seek redress through the courts in their own Member State, but that would be as a last resort.

I was pleased that my colleague Consumer Affairs Ministers and I were able to give our unanimous support to David Byrne’s proposal to create this Community-wide network of national extra-judicial, or out-of-court, bodies for the settlement of consumer disputes. The next stage, which is now underway, is the creation or designation of a single, one-stop national contact point - called a "Clearing House" - in each Member State, for the purposes of the EEJ-Net. And I have designated the European Consumer Centre as Ireland’s Clearing House.

The pilot project As Consumer Affairs Minister I have responsibility for the Sale of Goods and Supply of Services Act, 1980 - one of the principal pieces of consumer protection legislation. The rights which the Act confers on consumers are enforceable through civil proceedings in the courts. However, instead of - or prior to - initiating court proceedings, consumers have the option of availing themselves of an ADR mechanism, the Small Claims Procedure. The Small Claims Procedure, being within the District Court structure, comes under the overall responsibility of the Department of Justice, Equality and Law Reform. In terms of both policy and its application, therefore, my Department and Minister John O’Donoghue’s Department have complementary roles where the protection of consumers is concerned.

The Small Claims Procedure is widely acknowledged to be working well. It processes claims in relation to goods or services up to a current monetary limit of £1,000 in an informal way. It is also inexpensive - an administration fee of £6 is the only cost to the consumer. Starting two years ago, my Department has been providing consumer - focussed support through its annual grant to the Director of Consumer Affairs, under which a legal adviser is funded for the primary purpose of advising consumers in relation to recourse to the Small Claims Procedure. The legal advisor is based at the European Consumer Centre, which recently produced a reader-friendly guide to the Small Claims Procedure.

The pilot project, aimed at developing an on-line Small Claims Procedure, is designed to fit in with the Government’s Action Plan for the Information Society. In addition, it is intended to represent a positive response by this Government to action identified as necessary in that regard in the Forfás Report on "E-Commerce - the Policy Requirements". I am pleased that today’s initiative feeds into our commitment under the Programme for Prosperity and Fairness to pursue the e-commerce policy agenda, based on that Forfás Report.

It would clearly be premature to set the trajectory of the pilot project in stone at this commencement stage. I will therefore confine myself to saying that, as of now, it is envisaged that the pilot will develop in the following three, distinct phases:

• web-enabling the lodgement by consumers of claims in respect of complaints which currently come within the scope of the Small Claims Procedure
• broadening the scope of the Small Claims Procedure, so that it includes B2C (business to consumer) e-commerce complaints within Ireland
• broadening the scope of the Small Claims Procedure, so that it includes B2C (business to consumer) e-commerce complaints outside Ireland - in other words, the crossborder/European dimension.

The project Steering Committee A Steering Committee has been established to oversee the development of the pilot project. I am extremely pleased to be able to announce that the President of the District Court, Judge Peter Smithwick, has very kindly consented to chair the Committee. Both Minister O’Donoghue and myself greatly appreciate his ready acceptance of this responsibility. We are certain that his experience and guidance will be invaluable to the effective working of the Committee. The Committee members are representative of all the key interests concerned, whether directly or indirectly, with the objective of the pilot project: My own Department, the Department of Justice, Equality and Law Reform, the Courts Service, the Office of the Attorney General, the Director of Consumer Affairs, the European Consumer Centre, and the Consumers’ Association of Ireland.

The Steering Committee has just held its first meeting this afternoon. And I wish to convey our best wishes to them in their future endeavours on this exciting initiative, so that the potential benefits of its impact on consumer protection will be realised.

Thank you.