Law No. 144/2015 of September 8 transposed Directive 2013/EU of the European Parliament and of the Council of 21 May 2013 on alternative dispute resolution for consumer disputes.

The aforementioned legislation establishes the legal framework for Alternative Dispute Resolution mechanisms for consumer disputes, creating the Consumer Arbitration Network in Portugal.

1. What are consumer disputes?

These are disputes initiated by a consumer against a supplier of goods or services, concerning contractual obligations arising from sales or service contracts entered into between suppliers of goods or services established in Portugal and consumers residing in Portugal and the European Union (Article 2, paragraph 1 of Law No. 144/2015).

2. What is RAL?

ADR (Alternative Dispute Resolution) are mechanisms available to consumers and businesses to attempt to resolve consumer disputes outside of court, in a faster and less expensive way. ADR encompasses mediation, conciliation, and arbitration. The ADR process begins with an attempt at agreement via mediation or conciliation. However, if this agreement is not reached, the parties involved can still resort to the Arbitration Tribunal, through a simple and quick process.

3. What are RAL entities?

These are independent entities, with specialized personnel, that impartially help consumers and companies reach an amicable solution. These entities are authorized to conduct mediation, conciliation, and arbitration of consumer disputes. They must be registered on the list provided for in Article 17 of Law No. 144/2015.

4. Who is responsible for managing the list of RAL entities?

The Directorate-General for Consumer Affairs is the national authority responsible for organizing the registration and publication of the list of ADR entities (see ANNEX I).

5. How many RAL entities are there in Portugal?

In Portugal, there are ten Consumer Conflict Arbitration Centers. Seven of these have general jurisdiction and a regional scope, located in Lisbon, Porto, Coimbra, Guimarães, Braga/Viana do Castelo, Algarve, and Madeira. There is also a national territorial (supplementary) center, the CNIACC - National Center for Information and Arbitration of Consumer Conflicts. There are also two centers with specific expertise, specializing in the automotive and insurance sectors.

6. How does a company know which ADR entity it should recommend to its customers?

The location where a contract for the sale of goods or the provision of services is concluded, which generally coincides with the location of the business establishment, determines the competent arbitration center.

For example:

• A company that has only one or more commercial establishments in a given municipality must indicate only the ADR entity that has jurisdiction to resolve disputes in that municipality.

• A company that operates throughout the national territory must indicate all the competent entities.

• A vehicle repair shop, an insurance company, or a travel agency should indicate the specialized entities for those sectors.

 7. Who is required to inform consumers about ADR entities?

All suppliers of goods and service providers, including those who only sell products or provide services over the Internet, are required to inform consumers about available ADR entities, those they have voluntarily joined, or those to which they are legally bound. Only providers of Services of General Interest without economic consideration are excluded, such as social services provided by or on behalf of the state, health services, and public supplementary or higher education services.

The obligations arising from Law No. 144/2015 apply, with the necessary adaptations, to all economic sectors not excluded by said law, including those in which specific legislation already exists providing for an identical obligation.

8. Is there any requirement to join a RAL entity?

This law does not impose membership in any ADR entity, only establishing a duty to provide information about existing entities. However, there is the case of mandatory arbitration for essential public services, such as electricity, gas, water and waste, electronic communications and postal services.

9. How should companies provide this information?

This information must be provided in a clear, understandable, and appropriate manner for the type of goods and services being sold or provided (article 18, paragraph 2 of Law No. 144/2015).

Like this:

• On the website of the suppliers of goods or service providers, if any.

• In purchase and sale or service provision contracts between the supplier of goods or service provider and the consumer, when these are in written form or constitute adhesion contracts.

• If there is no written form, the information must be provided in another durable medium, especially on a sign affixed to the wall or placed on the sales counter, or on the invoice given to the consumer.

10. Does the law provide for any standardized model of information to be provided to consumers?

No. However, a proposed sign design is attached (Annex I).

11. Who is responsible for monitoring compliance with the obligation to provide information to consumers?

It is the responsibility of the Food and Economic Security Authority and the sectoral regulators in their respective fields to oversee compliance with these duties, to conduct the respective administrative offense proceedings, and to decide on these proceedings, including the application of fines and ancillary sanctions if necessary.

12. What is the consequence of failing to fulfill the duty to provide information to consumers?

Failure to inform suppliers of goods or service providers constitutes an offense, punishable by:

• A fine of between €500 and €5000, when committed by an individual.

• A fine of between €5,000 and €25,000 is imposed when committed by a legal entity.

14. When does this new regime apply?

Law No. 144/2015 of September 8th came into effect on September 23rd, 2015, and suppliers of goods or service providers had 6 months from that date to adapt to this new regime. Therefore, since March 23rd, 2016, companies must have this information available to their consumers.

ATTENTION: Providing consumers with information about available ADR (Alternative Dispute Resolution) entities does not exempt suppliers of goods and service providers from providing consumers with the Complaints Book, which is mandatory under Decree-Law No. 156/2005 of September 15.

List of Entities

Annex I