Alternative dispute resolution in Bulgaria

Author: Preslav Baldzhiev

The dynamism of public relations often creates misunderstandings between the trader and the consumer. These misunderstandings can often be resolved through open conversation in the spirit of understanding. Based on this idea, the Bulgarian legislator made changes to the Consumer Protection Act (CPA), which provided an opportunity for alternative dispute resolution.

What is alternative dispute resolution?

Alternative Dispute Resolution (ADR) is an out-of-court method in which an independent third party, other than a court, rules on a conflict between a trader and a consumer. An important specificity is that the dispute must have arisen for a good or service provided by a trader whose registered office is located in an EU Member State. The decision is not binding on the parties – it is more like a proposal to protect the interests of both the trader and the consumer, without going to court. If the parties are not satisfied with the proposed solution, they can take their dispute to a competent court.

An alternative dispute resolution is also the Online Dispute Resolution platform, with the only difference being that the latter can only be used for goods and services offered on the Internet.

When is alternative dispute resolution not applicable?

Although envisaged as an option, alternative dispute resolution is not always permissible. The parties may not resort to out-of-court redress if:

1. The dispute has not been referred to a competent authority;
2. The consumer has not first tried to resolve the dispute directly with the trader;
3. 3 years have elapsed since the dispute arose;
4. If the dispute is below or above a certain amount (depending on the competent authority);
5. The examination of the dispute will seriously impede the work of the competent authority due to factual and legal complexity;
6. The subject of the dispute is endangerment or damage to human health or public order and security;
7. The subject of the dispute is services from the field of higher education and healthcare;
8. It shall be established that a court or arbitration case has been instituted in the same dispute, or is being decided by another body for out-of-court settlement of disputes, including an open mediation procedure or by the bodies of pre-trial proceedings.

Alternative dispute resolution authorities

The CPA has established several authorities that can alternatively resolve disputes. The authorities are divided into separate economic sectors, which serve to determine their competence and which are evident on their behalf (“Sectoral Conciliation Commission for Disputes in the Field of…”).

There is also a Joint Conciliation Commission of the Consumer Protection Commission, which deals with disputes from sectors that do not fall within the scope of the Sectoral Commissions, as well as disputes received through the Online Dispute Resolution Platform. The Joint Conciliation Commission has divisions in each district city.

Alternative Dispute Resolution Procedure

Initiation of an alternative dispute resolution procedure is possible by:

1. Portal of the Consumer Protection Commission („Conciliation Commission“ section)
2. Fax, mail or at a counter in one of the divisions of the CPC;
3. The online dispute resolution platform (in the case of goods and services provided via the Internet) – the procedure is clearly explained in another article.

First of all, the consumer must choose to which Commission to refer the dispute – in the platform of the CPC there is a special section that indicates which authority is competent for which case. In addition, the consumer has a list of traders who have expressed their willingness to voluntarily participate in the out-of-court procedure.

When submitting an application for an alternative dispute resolution, the consumer must explicitly indicate that the dispute was initially referred to the trader. Only then will the consumer be redirected to another section to fill in their information. With the correct filling in of the electronic form, the consumer will receive an incoming number with which he/she can follow the development of his complaint.

Disputes that have arisen are considered in absentia by the competent authority and the entire procedure is conducted in writing, and the decision is taken within 90 days, based on the submitted documents, expertise, opinions of the parties. In case of the greater complexity of the dispute, the term may be extended by 20 working days. The decision should be made within two weeks after the conclusion of the procedure on the merits and it is not binding on the parties – if one of them does not agree with it, it can take the dispute to a competent court. Upon approval of the decision by the trader and the consumer, it receives the force of an agreement between the two parties. The parties must state in writing whether or not they accept it within 10 working days.

Once considered, the dispute cannot be re-submitted to an alternative solution – then it is necessary to refer it to the competent court.

Advantages of alternative dispute resolution

1. Efficiency ​​- the term for the respective competent authority is 90 days, while the court settlement of a dispute can take months and sometimes years;
2. Financial aspect – alternative dispute resolution is not expensive due to the lack of fees and attorney’s fees;
3. Flexibility – at the expense of the court proceedings, in which each document must be prepared in a certain form, in the alternative dispute resolution there is no such requirement;
4. Discretion – the agreement reached for the parties in the alternative settlement of disputes remains between the parties and has effect only for them.

This material prepared by Preslav Baldzhiev aims to provide more information about alternative dispute resolution in Bulgaria. It does not constitute a legal opinion and cannot be interpreted as individual consultation on any concrete facts or circumstances. The advice of a specialist should be obtained for specific questions and situations. For more information on the above-mentioned issues and individual consultations, please contact the team of the law firm of Krasimira Kadieva at 00359 882 308 670 or make an inquiry using the contact form of the website. Since 2017 Preslav Baldzhiev is a law student at Sofia University “St. Kliment Ohridski “, having previously graduated from the High School of mathematics and natural science “Acad. Nicola Obreshkov” in Burgas. In February 2020 he took a course for industrial property representatives at the Patent Office of the Republic of Bulgaria in the field of trademarks, geographical indications, and industrial designs. He is interested in intellectual property, personal data protection, commercial and law on obligations and contracts and also regularly attends conferences, practical courses, seminars, and webinars.