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Small business advisory review panel for potential rulemaking on arbitration agreements

As part of the Consumer Financial Protection Bureau’s efforts to make consumer finance markets work for consumers, and in accordance with specific authority from Congress, the Bureau is examining the role of arbitration agreements in the resolution of consumers’ disputes with providers of consumer financial products and services. Consumers and providers (i.e. the parties) may agree to arbitrate in two ways: they may agree to arbitrate a dispute after it has arisen or they may agree to arbitrate through contracts or clauses in contracts that require the parties to submit any future disputes between them to an arbitrator, rather than to a court. The former are sometimes called “post-dispute arbitration agreements” and the latter are sometimes called “mandatory pre-dispute arbitration agreements” because they commit the parties to arbitration before there is a dispute between them. The proposals under consideration concern mandatory pre-dispute arbitration agreements only, which are typically referred to in this outline more simply as “arbitration agreements.” Arbitration agreements were originally used primarily in contracts between businesses, but in recent decades have become increasingly common in consumers’ contracts with businesses for everyday consumer products, including financial products and services.

Full report

Final Report of the Small Business Review Panel on the CFPB’s Potential Rulemaking on Pre-Dispute Arbitration Agreements

Panel documents

Outline of proposals under consideration and alternatives considered

Discussion issues for small entity representatives

March 2015 report on Arbitration

Press Release: CFPB Considers Proposal to Ban Arbitration Clauses that Allow Companies to Avoid Accountability to Their Customers

On Nov. 1, 2017, the President signed a joint resolution passed by Congress disapproving the Arbitration Agreements Rule under the Congressional Review Act (CRA). Pursuant to the joint resolution, the Arbitration Agreements Rule has no force or effect. On Nov. 22, 2017, the Bureau published a notice removing the Arbitration Agreements Rule from the Code of Federal Regulations. The materials relating to the Arbitration Agreements Rule on the Bureau’s website are for reference only.