Have you ever paid your supplier abroad and he delivered a faulty product? Don't worry, there is a cheap way to claim your money back. The European Commission has proposed to strengthen the position of consumers and businesses in low-value cross-border disputes. Since 2007, the EU has a procedure to resolve small civil and commercial disputes in a hassle-free way:
the European Small Claims Procedure. Six years down the line, the Commission is drawing on the experience acquired to make the European Small Claims Procedure even simpler, cheaper and more relevant for consumers and businesses. The key change proposed would raise the ceiling for filing a claim under the procedure to €10 000, up from €2 000. Small businesses will be the big winners of this change - as currently only 20% of business claims fall below the €2 000 threshold.
"No consumer or business claim is too small for justice to be served", said Vice-President Viviane Reding, the EU's Justice Commissioner. "Having listened to businesses, the Commission is proposing rules that will make a truly European procedure more effective and relevant to daily life. At a time when the European Union is facing big economic challenges, improving the efficiency of justice in the EU is key to restoring growth and boosting trade. We are acting to simplify the procedure for resolving low-value disputes in our Single Market. Consumers and SMEs should feel at home when they buy cross-border."
The European Small Claims Procedure, which was adopted in 2007 and has been applied since 2009, is a useful tool that has proven its worth. It has reduced the cost of litigating cross-border small claims up to 40% and the duration of litigation from 2 years and 5 months down to an average duration of 5 months. However, there is room for improvement. A Commission report on the European Small Claims Procedure, finds that the upper limit of €2 000 for filing a claim excludes too many low-value disputes, particularly disputes involving small and medium-sized enterprises. A large number of disputes is also excluded by the narrow definition of what a 'cross-border' dispute actually is, meaning that for example, a car accident in a border region of another Member State or a lease contract for a holiday property are not currently covered by the Procedure.
The Commission is therefore taking action to improve the usefulness of the procedure, by introducing a targeted set of practical changes to the way the procedure operates. The Commission's proposal to revise the Small Claims Regulation will notably:
Raise the threshold for filing a 'small claim' from €2 000 up to €10 000. This will notably benefit SMEs, making the procedure applicable to 50% of business claims (up from 20% today).
Widen the definition of what is a 'cross-border' case in order to help more businesses resolve their cross-border disputes.
Cap court fees: Under the existing small claims procedure court fees can be disproportionate, in some cases even exceeding the value of the claim itself. This proposal will ensure that court fees do not exceed 10% of the value of the claim, and the minimum fee cannot be higher than €35. It will also require that court fees can be paid online by credit card.
Cut paperwork and travel costs: The new rules will enable claimants to launch the procedure online: email will become a legally valid means of communication between the parties involved, and teleconferencing or videoconferencing will become natural tools in oral hearings, wherever these are necessary.
With this proposal the Commission is facilitating effective access to justice for consumers and businesses, so they have the confidence to better exploit the Single Market.