Ina Steiner EcommerceBytes Blog
News and insight focusing on ecommerce.
by Ina Steiner, Editor of EcommerceBytes.com
Tue Jan 12 2016 21:28:07

Should Dispute Resolution Be Mandatory for All Sellers?

By: Ina Steiner

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A new requirement impacting merchants in Europe raises an interesting question: Should online sellers be required to offer customers Online Dispute Resolution (ODR) services?

We delve into the EU directive that requires merchants to link to the EU's new ODR platform in Wednesday's Newsflash newsletter. In a nutshell, the move is part of a vision to make cross-border trade between European countries easier and feel safer for shoppers and is part of the EU's "Digital Single Market" strategy.

At first glance, one might think that online sellers would be resistant to being forced to go through a process where a third-party settles disputes between themselves and buyers. But with the rise of buyer scams (and "lying buyers"), some might actually welcome it as a positive development.

In fact, some online sellers might welcome a requirement that online buyers be required to submit to online dispute resolution.

We'd be interested in what experiences readers have had with online dispute resolution.

And, do you think online sellers should be forced to engage in online dispute resolution? And just as importantly, should online shoppers be forced to?




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Readers Comments

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by: Santini This user has validated their user name.

Tue Jan 12 22:59:25 2016

While politicians like to play fast and loose with other people's money, on second thought this could be a good idea. Especially if it can track, and sanction the serial refunders and scammers, despite attempts to hide their tracks. Big databases are always a worrisome thing, but if it must come to pass, maybe it could do a little to help the good guys this time.

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by: pace306 This user has validated their user name.

Tue Jan 12 23:23:55 2016

There can never be a fair process for sellers, when the ultimate trump card is always a buyers CC.

CC companies do not want to disappoint customers and choose them over the merchant %99 of the time.

Of course almost anything is better then RETURNbay, where the emporer who has no clothes practically BEGS buyers to return items. Of course if that process just happens to ignore RETURNbays own rules ... well such is life isnt it?

Without seeing who represents whom, and what the rules would be - the question is too big to answer.

We've seen what lengths Amazon, RETURNbay, not to mention Paypal will do to turn the screws on the seller - Id beware of any quasi government group that wants to insert itself into a sellers business.

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This user has validated their user name. by: Beanie

Tue Jan 12 23:33:44 2016

Oh Yes, someone else to stick their noses in a sellers business. You can best bet it has a fee attached. It may start out free, but the fees will quickly follow the bigger they get. Sound  familiar? Someone is always up burning the midnight oil trying to figure out how to get your hard earned money. SMH

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by: comet This user has validated their user name.

Wed Jan 13 00:33:49 2016

Didn't ebay HAVE something like this way back when?  Was it called SQUARE--as in Square Deal?  Where you could go and call and speak --or email---a dispute resolution person?  I think I used it once but can't really remember the outcome.  

Of course this was back before the psycho's were running the place.

If I thought that you could have a RATIONAL sort of defense of your items---as in---you could submit your evidence that your item was NOT damaged when you mailed it etc---or that yes you DID get a box of hammers back after you sent off a Tiffany lamp----I would be all for it.  Sadly I suspect that this would be outsourced to some island nation (No; NOT Britain!) where the usual problems with language and terms would ensue.  

What we need here in dealing with ebay--and face it--it is almost ALWAYS an ebay problem!---is ON SHORE NATIVE AMERICAN ENGLISH SPEAKERS.  That understand  the terms WE use and who are no forced to script read.  

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This user has validated their user name. by: LasVagueness

Wed Jan 13 00:44:06 2016

I believe it was called SquareTrade.

As @pace306 mentioned above:

''There can never be a fair process for sellers, when the ultimate trump card is always a buyers CC,''

online 'resolution' may be moot.  

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by: Biglouis This user has validated their user name.

Wed Jan 13 01:25:17 2016

The European Commission is probably one of the most corrupt organizations on the planet - after fleecebay. Which is why many of their whacky "directives" get quietly ignored/disregarded by most small sellers. If they told me it was raining I would go to the window and look - thats how much I trust politicos

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This user has validated their user name. by: Marie

Wed Jan 13 02:47:16 2016

Who pays for it?  What would the cost be?  Who trains the CSRs and on what do they train them?  What would the guidelines be?  What is their incentive to really be fair and not just get claims closed?

Oh my questions could go on and on.  

This is a very complicated issue.  Which is why Ebay doesn't get very involved.  It costs time and money to look at the situation / evidence of each claim.  Researching and actually trying to be fair is not always easy.  Canned responses just won't work many times.

For me, I don't have the same problems with chargebacks as Pace does.  Over the years I've had my share of them, but I've only lost one.  Now PP may have lost money, they don't always share that info with you.  

BTW, if you can show a that a buyer filed a claim using a different method and won or lost with cause, and then that customer files a chargeback, you can use that information against them with their own CCC.  

I also don't agree that a CCC always sides with the card holder 99% of the time.  To do so could put that CCC at risk for a merchant to no longer accept that type of CC.  Merchant pay the fees to the CCC.  So if a CCC allows what they deem to be too many chargebacks, a merchant could deem it is not cost effective to allow that CC to be used for purchases.

I've personally filed a couple of chargebacks over the years.  My CCC required quite a bit of information from me and was very complete in the review of all info before determining the outcome.  But that is just my own experience.  Others may have different ones.  

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by: punkin432 This user has validated their user name.

Wed Jan 13 08:34:37 2016

This is a joke. No matter what you do ebay finds in favor of the buyer. I recently sent a package out and it stated the item was shipped by the Post Office but the seller never received the item. She filed a dispute and before I even had a chance to fill out my side they found in favor of the buyer. So we as seller don't have a leg to stand on. We are dealing with some very dishonest buyers at times and take the loss every time. That may be fine for high volume sellers but not for those of us that sell to supplement our income. Not only do we lose our product but we lose the money and our shipping costs. It's a no win situation in my opinion.

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This user has validated their user name. by: Shop and Ship

Wed Jan 13 09:39:15 2016

I agree with Comet: when the eBay CS facility was in Utah we could see a certain morality to the process and the outcomes. Once CS was centered in Mumbai with canned responses and no authority to intervene then the process itself was corrupt. In short, no process is any better than the people who are administering it. Neither eBay nor anyone else can legitimately predetermine the outcome to a transaction that hasn't happened yet. I hate to recall the number of times an eBay CS has said "Oh, I agree with you BUT ..." and then proceeds to misquote long-standing published guidelines.  

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by: Bethofvt This user has validated their user name.

Wed Jan 13 11:01:23 2016

No matter how bad it might be, it has to be better than the given with Ebay. Buyer is right, seller not only has to return payment, but loses shipping cost and has to pay return shipping.  Oh but Ebay not done yet, now they are going to give you a defect as well for selling to a liar buyer who returned your item after using it for his purposes. I just got back a $165 Xmas tree topper. Buyer received it new in the box 12/15, returned it to me 1/05 (time enough to use for 2+ weeks on his Christmas tree) and of course claims it was INAD, his reasoning? I did not disclose that the manufacturer uses 2 different finishes on the product. I am stuck refunding, eating $12 shipping, paying $12 return shipping and not able to resell for nearly a year as it is a seasonal product, which is now a used product rather than new in sealed box.  How could Dispute Resolution be any worse?

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This user has validated their user name. by: Rexford

Wed Jan 13 12:23:55 2016

So we've got the eBay layer, the PayPal layer....oh yes, bring on another layer. (insert eye roll)

When Santini mentioned how politicians like to play fast and loose with other people's money I thought how very much that sounded like both eBay and Amazon.

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This user has validated their user name. by: iheartjacksparrow

Wed Jan 13 14:37:09 2016

During my lengthy time working as a paralegal, I was involved (typing briefs) with many arbitration hearings since the California Courts would prefer cases get settled before they go to trial. I have never personally been involved in any sort of dispute resolution.

The attorneys would choose from a list of available arbitrators, most of whom were retired Judges. The attorneys would always attempt to pick someone who had expertise in the matter being litigated, and both sides would split the cost paid to the arbitrator (who would issue his recommendations generally within a couple of weeks).

I think dispute resolution could be effective so long as the arbitrator isn't a person eBay (or whichever site) dragged off the street who knows nothing about buying and selling online. Also, I think it would be important that the arbitrator be 100% impartial, not associated with the venue or payment processor in any manner, and would base his or her findings solely on the evidence presented.

The real deterrent would be the cost each of the parties would have to cover unless they could find people who would arbitrate for no fee. Personally, I would do it for free just so I could see what kind of evidence lair buyers would try to come up with.  

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This user has validated their user name. by: bitbybit

Wed Jan 13 15:31:17 2016

Online sellers have to fight tooth and nail on every level just to stay in business. All of this seems to be done to wear out sellers to the point of giving up to big business or those in power.

Sure all of this sounds good on paper but until fair and level playing field actually align in real time, it is meaningless.

There are too many unknown variances with transparency always an issue. It boils down to the question of ''who will benefit the most?''. Somehow I think the sellers will once again be drawing the short stick.  

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by: pace306 This user has validated their user name.

Wed Jan 13 15:32:12 2016

Marie :)

Im so glad that you dont have the issues I get .... I hope that that trend continues for you in 2016.

Its not that I have TONS of issues, its that the ones that I do are such lies and falsehoods - it just simply shocks me "to the core".

No matter what RETURNbay policy I point out to the agents when I call - I get the same canned answer - "its what we call a faulty return, too bad eat the loss as a business expense".

I have people who admit in their emails that they open up and try things (eBay says that even though in its item returns condition page it says NEW AND UNOPENED, its still ok), RETURNbay has told me its ok for a customer to switch the item (same item different serial number -since "its teh same item") and lots more.

When I call, before I even layout my case, RETURNbay is DETERMINED to make me eat new sealed items (properly described and shipped on time or early) that have been "played with" by my? their ? buyers. NO AMOUNT of talking will convince them otherwise, no matter how many times I call. I even get the BS "Im a seller on eBay too dude!"... oh please!

I do hate eBays returns process - I just ask for abit of fairness - you can return items if you dont OPEN THEM and switch or use them .. why is that so hard? (esp when the customers ADMIT in RETURNbay emails that they did so).

Should I spend $25K to go to court for $200? Probably - but then Id be as dumb as Devin Wenig wouldnt I ?

BTW :) I dont get chargebacks - I get those "faulty returns".

Bottom line - its RETURNbay itself thats faulty - not me as the seller - since RETURNbay refuses to abide BY ITS OWN RULES.

I just finished making EVERYTHING "no returns", as I can no longer take the abuses heaped on me RETURNbay.

For the $250 loss I was just forced to eat - I picked up a new customer off eBay (DW come get me if you please) and I went round then bend to a large sellers own website to buy something, when I could have EASILY bought it from them off RETURNbay and let RETURNbay make a fvf off it.

Sure its only a drop in the bucket to RETURNbay, but the satisfaction of getting revenge on the lieing, stealing, cheating SOBs feels oh so good.

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This user has validated their user name. by: Philip Cohen
Web Site

Wed Jan 13 18:12:02 2016

@Marie—“I also don't agree that a CCC always sides with the card holder 99% of the time. To do so could put that CCC at risk for a merchant to no longer accept that type of CC. Merchant pay the fees to the CCC. So if a CCC allows what they deem to be too many chargebacks, a merchant could deem it is not cost effective to allow that CC to be used for purchases.”

First of all, in the case of MasterCard and Visa, you are never dealing with the “credit card company”; MasterCard and Visa supply only the pipes that connect the system; they do not control the direction of what flows through those pipes; as a MasterCard/Visa credit card user you are only ever dealing with your individual card-issuing bank; as a merchant you are only ever dealing with your merchant account-acquiring bank.

Merchants don’t pay fees to MasterCard or Visa; they pay fees to their merchant account acquiring bank. Any transaction dispute is resolved directly between the credit card issuing bank and the merchant account acquiring bank. There is no involvement by MasterCard or Visa is such mediation

It therefore logically follows that there is simply no way that a merchant will ever decide to not accept “that type of CC” on the basis stated because the brand of credit card is never going to be the problem; if there is a problem, it is the individual bank(s) involved. Having said that, the world’s banks are run professionally on accepted rules (unlike eBay/PayPal). The idea that the world’s retail banks’ established credit card payment system could be so unprofessional—unlike eBay/PayPal—that any merchant would choose to refuse to accept one of those major credit card brands on the basis of excessive charge-backs is simply nonsensical.

However, invariably, the card-issuing bank will, in the first instance, side with the credit card user who has made what appears to them to be a valid complaint; and the transaction in question will likely be reversed; the merchant then has the opportunity to respond to that complaint for the purpose of having the charge reinstated.

My experience, as a merchant, has been that—unlike that of eBay/PayPal—my bank’s mediation process has always been professional and fair, notwithstanding that some effort by all the parties involved may be required to have a particular matter resolved.

If your credit card issuing bank’s transaction dispute mediation process appear less than satisfactory, then maybe it’s time to try another bank …

Then, there’s always the option of a “merchant account” with PayPal—LOL …

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by: sasikat9 This user has validated their user name.

Wed Jan 13 18:46:17 2016

Now thats funny....Can ya all see it... The chinese in a dispute resolution with all their junk and knock offs.

But then again like the post office Fleecebay will just cut them a special deal as with all the diamond sellers.

Sellers in the United States on Fleecebay and Amazon are just second class citizens to be fee hiked to death.

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by: Joey4711 This user has validated their user name.

Wed Jan 13 23:19:24 2016

Ebay doesn't want to side with you nor Amazon because if they do they lose money.  I think paypal is a different animal most credit card companies I have seen have no trouble with chargebacks putting them on paypal as they look at it that paypal needs them more than they need paypal in my opinion.

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by: mcposty This user has validated their user name.

Thu Jan 14 12:12:21 2016

No, unless there is 100% effort to.verify all facts, it will not work.

Its always word against word.abd rhe buyers word is seen to always be right even if its wrong



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by: Beth This user has validated their user name.

Fri Jan 15 06:37:08 2016

I think a lot of you double as buyers on ebay - YOU DON'T READ.

This is distinctly NOT an ebay or amazon issue, it's the European Union (think US CONGRESS)  and as some up top said... political.

I'm not a fan of that either. But for God's sake, quit blaming ebay for everything in an automatic shoot first and ask questions never behavior.

I think I'm getting to the point with all these "monitoring" points, ebay csrs and mgmt, amazon csrs and management, credit card processors rules etc. that it's time to retire and slowly starve to death.  

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by: notbananas This user has validated their user name.

Fri Jan 15 10:24:31 2016

As "iheartjacksparrow" said in a mediation or arbitration, the deciding person has to be familiar with the subject being mediated.

For this impossible scheme they are cooking up, there's no way on this green earth they can have a person familiar with the item being disputed in every case. It's simply not possible!

There are millions of different items sold and if a buyer disputes a left handed widget, there has to be a knowledgable mediator in left handed widgets. Otherwise it's not possible for the mediator to make a fair decision.

One time I had a dispute with AmEx as a merchant, it was decided in my favor since the buyer lied and couldn't prove his case. The CS rep who handled the dispute was professional, and looked at all the evidence we both presented. It took several weeks to have the decision made, but it was a just decision. I wondered why the delay, so the only thing I can assume is the CS rep had it reviewed by a knowledgable person in the subject of the dispute which was a used 24" computer monitor (before LCD monitors) for $780.

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