National Consumer Disputes Redressal Commission Notifies Regulations for Consumer Protection Mediation

The National Consumer Disputes Redressal Commission (NCDRC) issued a significant piece of delegated legislation, the Consumer Protection (Mediation) Regulations, 2020, on July 24, 2020. These regulations were promulgated under the authority granted by Section 103 of the Consumer Protection Act, 2019 (35 of 2019), with the prior approval of the Central Government. The issuance of these regulations was necessitated to establish a comprehensive framework for the conduct of mediation proceedings, which was introduced as a key alternative dispute resolution mechanism under the new Consumer Protection Act. The regulations came into force immediately upon their publication in the Official Gazette on July 24, 2020.

The regulations define key terms such as "Act," "Consumer Commission" (encompassing District, State, and National Commissions), "Mediation Cell," and "settlement." They meticulously outline the eligibility criteria for individuals seeking empanelment as mediators, including retired judges of the Supreme Court, High Courts, and Consumer Commissions, retired judicial officers with at least ten years of experience, advocates with a minimum of ten years at the Bar, and professionals with substantial experience in mediation or relevant fields. Conversely, the regulations specify clear disqualifications, such as insolvency, pending criminal charges involving moral turpitude, convictions for such offences, or ongoing disciplinary proceedings. A crucial disqualification also applies to individuals with a conflict of interest, including any connection to the subject matter of the dispute or the parties involved.

The procedure for empanelment requires each Consumer Commission to invite applications through widely circulated English and vernacular newspapers. A Selection Committee, constituted under Section 75(1) of the parent Act, scrutinizes these applications and recommends a panel of mediators, with the final number determined by the President of the respective Consumer Commission. Mediators can be removed for disqualification, misconduct, or unsuitability after a hearing, and re-empanelment is contingent on successful and efficient performance. The regulations also detail the fee structure for mediators, providing for a consolidated fee for successful mediations, half of which is paid for unsuccessful ones, with costs shared equally by the parties. Provisions are made for mandatory training for empanelled mediators and a strict code of conduct, prohibiting unauthorized communication and acceptance of gifts, and mandating disclosures regarding potential conflicts of interest.

The legislative intent behind the Consumer Protection (Mediation) Regulations, 2020, is to operationalize and streamline the mediation process envisioned by the Consumer Protection Act, 2019. Prior to the 2019 Act, statutory mediation was not a formal part of the consumer dispute redressal mechanism, leading to a reliance on adjudicatory processes that could be time-consuming. These regulations address this statutory gap by providing a robust procedural framework for consumer mediation, aiming to facilitate quicker and more amicable resolution of consumer disputes. The policy rationale is to reduce the burden on Consumer Commissions, offer consumers an accessible and efficient alternative for dispute resolution, and foster a culture of voluntary settlement.

The regulations introduce new obligations for mediators, including adherence to a strict code of conduct and mandatory training, while also granting them immunity for bona fide actions. They establish clear enforcement mechanisms for mediator fees and set statutory timelines for mediation proceedings, typically three months, extendable by the Consumer Commission. The regulations emphasize the facilitative role of the mediator, ensuring that the resolution remains voluntary and party-driven. The legislation provided: “The mediator shall attempt to facilitate a voluntary resolution of the disputes between the parties, assist them in removing the misunderstandings, if any, and generating options to resolve their disputes, but shall not impose any term or any settlement upon the parties.” This core principle underscores that mediation is a process of assisted negotiation rather than adjudication, where the mediator guides the parties towards a mutually acceptable solution without imposing a decision. The regulations also ensure confidentiality of proceedings and restrict mediator communication with the Consumer Commission to formal reports, thereby safeguarding the integrity of the mediation process.

Keywords: Consumer Protection Act 2019, Mediation Regulations, National Consumer Disputes Redressal Commission, NCDRC, Consumer Disputes, Alternative Dispute Resolution, Mediator Empanelment, Consumer Mediation Cell, Voluntary Settlement

Geo Tags: India, Delhi District: Not Applicable