Individual disputes

An individual dispute is a dispute arising between two companies regarding an alleged breach of the Principles of Good Practice.

What is the procedure?

In case of an individual dispute, companies have the following options to solve their disputes:

  1. Commercial track: the complainant may decide to take the issue to a higher level within the commercial hierarchy of the company allegedly in breach;
  2. Contract options: the complainant may resort to any mechanisms of dispute resolution foreseen in the contract;
  3. Internal dispute resolution: the complainant may resort to the internal dispute esolution body of the company allegedly in breach. With the exception of small companies, registered companies must have an internal dispute resolution procedure in place. This internal dispute resolution procedure must be independent4 of the commercial negotiations and be impartial and quick. It should be elaborated in such a way that it reassures that the complainant will not be subject to commercial retaliation;
  4. Mediation or arbitration: parties may choose to resort to an independent third party to solve their dispute either through a non-binding solution (mediation) or a binding decision (arbitration). These options require the agreement of both parties. The sharing of costs for this option is determined by the applicable law. The arbitration process should give effective guarantees of defence. The burden of proof rests with the complainant;
  5. Judicial methods: the complainant may choose to resort to the ordinary judicial methods according to national rules and regulations.

Commercial retaliation against any company for using these mechanisms is a serious breach of the Principles of Good Practice.

The choice of dispute resolution mechanism lies with the complaining company unless this would infringe national law. The latter may choose the option that best fits its needs provided that this choice is proportionate, taking into account cost efficiency and effectiveness in relation to the nature of the dispute. This means that companies are expected to resort first to the options that are less adversarial and costly.

The remedies, sanctions, and/or penalties, including financial compensation for any actual and proven damages, for non-compliance with the Principles of Good Practice, including commercial retaliation, are determined by the dispute resolution options used. They are enforceable according to the applicable law.

What to do?

Use one of the five dispute resolution mechanisms listed above.

For any questions on the Principles of Good Practice or past activities of the SCI, please contact the organisations.