Conference on Consumer Redress Mechanism
26 April 2000

"Redress Mechanisms
- Trade & Professional Related Complaints
Resolution Mechanisms"
by
Mr. Alexandre HO
President, Executive Committee of the
Consumer Association of Macau SAR

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Dear Distinguished Guests:

        First, let me express my gratitude for this opportunity to introduce to you the Consumer Arbitration Centre, which is a subsidiary of Consumer Council of Macau. Since the Arbitration Centre started its operations only two years ago, not only would I like to share with you our limited experience, but also welcome your feedback for us to better our work in the Arbitration Centre.

        Although Macau is only a small city, a comprehensive legal system has long existed and the Macau people can resort to legal means in times of disputes. However, there were very few disputes that were actually settled by legal proceedings at court, especially at the time before 1970s. There were a number of reasons underlying this phenomenon, for example, the conservative and harmony-loving character of the Macau people, the legal procedures of the court, and the knowledge of the Macau people in the judicial system.

        In the 1980s, great changes took place in the social environment along with the rapid economic development of Macau. As a result of the increased demand for consumer products and services, it seemed inevitable that there arose more and more complicated conflicts and disputes on consumer affairs. There came the public opinion of setting up an organization for handling such disputes. Therefore, the Macau government promulgated the law on consumer protection, identifying the various consumers' rights and the establishment of a consumer organization. There followed the establishment of the Consumer Council of Macau in 1989.

        In the ten years’ operation of the Consumer Council, the number of complaints and inquiries has increased significantly each year. This indicates the recognition of protecting their own rights on the part of the consumers, and the need for an intermediary to assist them in solving their disputes. The Consumer Council has been performing a role of bridging consumers and businesses. But, due to the limits in its legal power, there are some obstacles in the work on consumer protection and this becomes most obvious when it acts as an intermediary of consumer disputes. For instance, when the two parties cannot reach a mutual agreement, or when one of the parties fails to comply with the settled agreement, the Consumer Council has no legal power to protect consumers in their rights to proper redress. The Consumer Council recognizes that there is a need for an effective mechanism in dispute settlement.

        In 1996, the Macau government promulgated two decrees on voluntary arbitration, making way for the resolution of civil or commercial disputes other than going through the traditional judicial system. With the power conferred by these two decrees, the Consumer Council set up the first voluntary arbitration centre in Macau in 1998, the Consumer Arbitration Centre.

        As mentioned above, the Consumer Arbitration Centre, which is a subsidiary of the Consumer Council, started its operations in 1998. It provides a fast and flexible way of handling consumer disputes with an amount no more than MOP$25,000. Cases are submitted to the Arbitration Centre voluntarily and procedures are free of charge to both parties.

        The work of the Consumer Arbitration Centre is carried out in three steps, i. e., mediation, reconciliation and arbitration. With the mutual agreement of both the consumer and the business, the case is submitted to the Arbitration Centre. In the phase of mediation, the Director of the Arbitration Centre collects the complaint in writing and plea, which may be addressed in writing before or verbally during the proceedings. Then, conciliation takes place in which he arranges a meeting with both parties and attempts to come to a just solution that satisfies them. If no agreement can be reached in this stage, the case is heard and decided upon by the arbitrator-judge. Whether it is the conciliation agreement ratified by the arbitrator-judge or the arbitration decision made by the judge, the result is legally binding to both parties as in the case of a judicial court order. The arbitration judge adopts both the current legislation and the principles of equity in his/her rulings. Because of their expertise in the trade, counsellors may be invited to the conciliation and arbitration proceedings to give opinions on the product or service in question.

        As mentioned above, the submission of cases to the Arbitraion Centre is voluntary, which means that both the consumer and the business agree to do so. In respect of traders, there is a system for adherence. Traders become 'adherents' to the Arbitration Centre by agreeing to submit to a hearing before an arbitrator in respect of any dispute to which they are party. There are 114 adherents to the Arbitration Centre now. On the other hand, traders that are not adherents can also submit their cases to the Arbitration Centre by means of 'temporary adherence'.

        The Arbitration Centre has been operating for only two years, which means its experience is only limited, but it still gains much recognition of the Macau people. Each year, it handles more than ten cases from different trades. Its popularity can be accounted to some reasons. Firstly, the fast and free service provided by the Arbitration Centre makes it affordable for both parties in terms of time and money. Moreover, the complicated legal proceedings may be avoided if the dispute is handled by the Arbitration Centre. The flexibility adopted in the procedures means an easier and more harmonious way of bringing resolution to the disputes. As a matter of fact, about half of the cases handled are settled in the stage of reconciliation.

        Due to its voluntary nature, the success of the arbitration system in dispute settlement relies heavily on the willingness of the two parties. If one of the parties disagrees to submit the case to the Arbitration Centre, this mechanism cannot be applied to the case. This indeed hinders the effectiveness of the Arbitration Centre in protecting the consumers’ rights on proper redress. Therefore, besides promoting the work of the Arbitration Centre as a settlement means, the Consumer Council also believe that it is essential to set up a small claims tribunal in Macau. The Consumer Council thinks that, in cases which mutual agreement cannot be reached, the disputes can be submitted to the tribunal by one of the parties. This can, in a way, help to supplement the limitations of the Arbitration Centre.

        In the meanwhile, besides strengthening the role of the Arbitration Centre, the Consumer Council will also try to draw the public attention in the idea of establishing a small claims tribunal.