Last night, the three European institutions, Commission, Parliament and Council, have reached an agreement on the so-called Collective Redress Directive, a flagship consumer law, that will allow European consumers to file class actions across the bloc. The new rules introduce a harmonised model for representative action in all member states, guaranteeing consumer protection, while also ensuring appropriate safeguards from abusive lawsuits.
It covers important sectors, such as travel, tourism and passenger rights, health, and environment, but also data protection, among others. Earlier this year, DigitalEurope has noted that this directive, which includes GDPR in its scope, is in direct conflict with the one-stop-shop procedure and the standards set out in the GDPR’s Art. 80. A reminder that the European Commission will publish its review of the GDPR tomorrow.
The directive will allow each country to name at least one qualified entity (organisation or public body) that will be allowed to bring cases forward, and the rules distinguish between cross-border and domestic cases. For domestic actions, member states will set out proper criteria consistent with the objectives of the directive, which “could be” the same as those set out for cross-border actions.
The rules strike a balance between access to justice and protecting businesses from abusive lawsuits through the introduction of the “loser pays principle”, which ensures that the defeated party pays the costs of the proceedings of the successful party.
Following this deal, the Parliament and the Council will now have to formally approve the political agreement. The directive will enter into force 20 days following its publication in the Official Journal of the EU. Member states will then have 24 months to transpose the directive into national law, and an additional six months to apply it