EU leaders will be asked at their Lisbon "innovation" summit later this month to back a radical new approach to empowering consumers in the booming e-commerce sector.
A strategy to raise consumer confidence in e-commerce is key to overcoming the serious lag between Europe and the US, argues Mr David Byrne, EU Commissioner for Health and Consumer Protection.
He proposes an easy-access, online approach to dispute resolution that should give redress to small claimants without the cost of court action, although this alternative would remain as a last resort.
A study last month from the Boston Consulting Group puts the total value of online retailing in western Europe in 1999 at $3.5 billion (€3.6 billion), rising to $9 billion this year. The report projects revenue in 2002 of $45 million, a possible thirteen-fold increase on last year.
But the group warns that online retailing accounts for only 0.2 per cent of the European market while the US figures is 1.2 per cent. Some 29 per cent of US sales are in Europe where the US already controls one-fifth of the market. External sales of the European market amount to only 2 per cent.
But in Europe and the US, customers have experienced very high rates of non-delivery or wrong delivery - one survey puts it as high as 15 per cent in the US and some EU e-tailers have admitted to rates as high as 50 per cent.
Mr Byrne argues that the rapid growth of the US sector is attributable largely to emerging consumer guarantees that transactions are safe and reliable.
The most important of these are the trustmark and chargeback systems - the latter involves credit card companies holding cash back from suppliers for a fixed period and then negotiating with them directly if a customer is dissatisfied.
Officials in the EU's consumer directorate have been discussing the same approach with major European banks and are confident that some form of chargeback is viable for the EU market.
And while EU legislation comes into force this summer providing for the consumer's right to sue suppliers in the consumer's national small claims courts, Mr Byrne also urges setting up a network of simpler, voluntary, online disputes resolution systems.
The idea is to get suppliers to sign up to industry-run alternative dispute resolution systems (ADRs) to provide a first point of contact for dissatisfied customers. There are already some 200 ADRs functioning in the EU, some run by industry, some by states. Customers would make claims to the computer-linked ADRs through national offices in their own country and the process would be online.
The courts would be involved only if customers did not get satisfaction.
Mr Byrne, who says the experience in Canada of "cyber tribunals" is good, hopes to minimise the system's regulatory aspects - and he wants it up and running by next summer.
