John Dalli, commissioner for health and consumer policy, said the proposals would reassure people that warranties and rights are valid everywhere in the EU when they buy products in person or online.
“Low confidence is hurting the recovery of the European economy, which is now Europe's primary goal,” Dalli told a news conference after the EU executive agreed the measures.
“We contribute to increasing confidence by providing European consumers and businesses with a real alternative which is easier, faster and cheaper than courts,” he said.
The measures face approval from both the European Parliament and national leaders, and it could be 2015 before they are in place.
If the Alternative Dispute Resolution Directive is approved, EU countries would have to provide out-of-court arbiters, ombudsmen or consumer boards to help handle disputes. The Commission also proposes an EU-wide online platform that would allow consumers to file complaints in their own language against a company or service in another nation.
The Commission has previously recommended that national governments provide out-of-court alternatives for consumers, and most countries have enacted laws, although the provisions are not uniform. Neither Slovenia nor Slovakia has alternative dispute resolution for consumers, Dalli said, while several Baltic and Nordic countries have strong arbitration systems.
“The time has come to legislate,” he said, referring to the need for strengthening out-of-court resolution across the EU.
In June, the European Parliament approved a Consumer Rights Directive designed to strengthen refund rights, increase price transparency, eliminate surcharges on credit cards and address complaints about goods or services purchased over the Internet. The law takes effect in 2013.
That proposal faced strong opposition from small businesses that feared the legislation would increase their administrative burdens.
But Dalli says the new consumer legislation will could save consumers €22.5 billion and businesses €3 billion each year by settling disputes outside the courtroom.
The Commission estimates that in 2010, 100 million Europeans – one-fifth the EU population – had problems with fraudulent sales or faulty products in the common market.