Draft Digital Markets, Competition and Consumers Act 2024 (Alternative Dispute Resolution) (Conferral of Functions) Regulations 2026 Draft Digital Markets, Competition and Consumers Act 2024 (Alternative Dispute Resolution) (Consequential Amendments) Regulations 2026

Gareth Davies Excerpts

Wednesday 25th February 2026 General Committees

[Gareth Davies (Grantham and Bourne) (Con)]

It is always a great pleasure to see you in the Chair, Ms Lewell. It is also a pleasure to see the Minister in her place. Alternative dispute resolution is intended to provide a low-cost, efficient alternative for resolving disputes between consumers and businesses. I thank the Minister for setting out what these regulations seek to achieve.

The regulations follow various pieces of work that were carried out by both Conservative and Labour Governments over many years, with the overall goal of securing a fair deal for consumers and a fair operating environment for businesses. Although the Opposition of course remain supportive of the goals of the Digital Markets, Competition and Consumers Act 2024, we in this place should always be mindful of the adverse impacts of introducing any kind of red tape on British businesses, no matter how well-intentioned it might be.

As the Committee would expect from the official Opposition, we have a few questions to probe some of the elements in these measures. First, will the Minister set out the current status of the ADR provider sector, and how the Government see the sector changing as a direct result of the regulations? More specifically, how many ADR providers are there in the UK, and how many of those are currently unaccredited and would therefore be impacted by these measures? Do the Government expect the number of ADR providers to reduce as a result of the requirements? If so, what impact does the Minister believe that that reduction will have on consumers and businesses that use those services?

Finally, what is the Government’s view of the impact the regulations will have on those who operate ADR businesses? The explanatory memorandum to the regulations states that the Government expect there to be no impact on businesses, and that

“the instrument does not impose regulatory obligations”.

However, that is exactly what is being done today, so that looks like an error. I would be grateful if the Minister clarified whether that is an error, and explained the language in the explanatory memorandum for the benefit of the Committee.

[Kate Dearden]

I thank the shadow Minister for his comments and his support for the Act and the regulations we are considering. The regulations place the CTSI on a statutory footing. I alluded in my introductory remarks to the role of the Secretary of State and the accreditation determinations, monitoring, enforcement and information sharing under the Act, as well as the mandatory and accreditation requirements.

In terms of exempt ADR providers, to avoid duplicated regulatory provision, the Act exempts ADR provision under several ombudsmen and equivalent schemes, which are already regulated under other legislation. Those are either statutory bodies performing statutory functions or redress schemes regulated by other bodies under other legislation. If a sector already has its own dispute resolution system, these new ADR rules will not apply and that avoids doubling up regulations and ensures that businesses follow only one set of rules, with no confusion about who is responsible.

There are also some statutory bodies that, to an extent, carry out ADR and it is not considered appropriate to regulate them as their remit does not cover consumer contracts as defined in chapter 4 of part 4 of the 2024 Act.

I am happy to follow up the hon. Member’s point about the specifics on the statistics afterwards if he requires any further information. On the effect of schedule 25 listing exempt ADR providers, that is quite clear, but again, if he would like further information on how we are avoiding duplication, I am happy to provide it as there is a power to add further exemptions in future, which might be used where it is more appropriate to regulate ADR elsewhere.

The important point about the legislation is that it will ensure that ADR is much easier for consumers and businesses. That is really important to reflect on. What ADR can provide in terms of support and streamlining for businesses and consumers is significant, and will offer a cheaper and faster alternative for consumers and businesses seeking to resolve disputes, compared with making a claim to the courts. This framework gives the flexibility to update those standards over time. That is important and provides a foundation for considering further reforms if required.

[Gareth Davies]

I totally understand that the Minister might not have the information to hand right now, so will she commit to writing to me?

[Kate Dearden]

Yes, I am happy to provide that follow-up information.

Question put and agreed to.

DRAFT DIGITAL MARKETS, COMPETITION AND CONSUMERS ACT 2024 (ALTERNATIVE DISPUTE RESOLUTION) (CONSEQUENTIAL AMENDMENTS) REGULATIONS 2026

Resolved,

That the Committee has considered the draft Digital Markets, Competition and Consumers Act 2024 (Alternative Dispute Resolution) (Consequential Amendments) Regulations 2026—(Kate Dearden.)