The Netherlands: Implementation of the EU Collective Redress Directive
The Netherlands is one of the first EU member states to implement Directive (EU) 2020/1828 on representative actions for the protection of the collective interests of consumers (the “Directive”) into national legislation. All member states have to implement the Directive by 25 December 2022, with a further six months permitted for the new provisions to come into effect (read more on the Directive here).
The new law
The legislative proposal for the implementation act was published on 11 February 2022 (the “Proposal”). The Dutch Parliament voted in favour of the Proposal on 25 May 2022, following which the Dutch Senate adopted the Proposal on 1 November 2022 (dealing with the Proposal as a formality). Next steps are signing of the act by the King and the Minister of Justice and Security (Minister van Justitie en Veiligheid, the “Minister”) and publication of the Proposal in the Dutch State Gazette by the Minister. The Proposal stipulates that the act shall enter into force on 25 June 2023 or, if the act has not been published in the Dutch State Gazette by that time, on such date after 25 June 2023 on which the act will be published in the Dutch State Gazette.
How will the Directive impact existing Dutch law?
As the Netherlands already has a collective redress regime in place that is largely in line with the Directive (the so called “WAMCA”, read more here), the implementation of the Directive does not require a complete overhaul of Dutch law. The WAMCA is currently seen as relatively claimant-friendly, in the sense that the prerequisites for representative organisations to launch a collective action are not too burdensome. The Proposal does not change this significantly, although it does add additional financing requirements for representative organisations. The legislator specifically recognised the need of representative organisations for third party funding and stipulated that it did not want to limit their options more than is necessary on the basis of the Directive.
The Proposal also includes two amendments to the WAMCA that will apply to consumer cases only:
- The provision in the WAMCA that waives certain admissibility requirements (specifically those regarding the governance of the organisation) if so requested based on the nature of the case (e.g., in the case of a very small claim amount) is deemed contrary to the Directive. Therefore, the Proposal provides that it does not apply in consumer cases.
- The WAMCA provides for an opt-out option for Dutch injured parties and an opt-in option for foreign injured parties. It also provides for the possibility to ask the court that the foreign injured parties represented by the representative organisation are deemed to have opted in unless they explicitly opt out. According to the Proposal, however, the latter option will not be available in consumer cases.
Other, relatively limited, adjustments to the WAMCA relate, for example, to the provision that consumers cannot participate in multiple actions in different jurisdictions, information requirements and certain provisions for representatives submitting a cross-jurisdictional action.
Finally, based on the Directive, the Netherlands must allow foreign representative organisations that have been included in the lists of other EU member states to conduct collective redress proceedings in the Netherlands. Courts will not assess whether an organisation that has been listed in another EU jurisdiction complies with the admissibility requirements. However, it can assess whether the collective redress proceedings themselves comply with the relevant Dutch law requirements (as implemented).
The Netherlands will also have to prepare a list of the Dutch organisations that comply with the admissibility requirements following from the Directive and the WAMCA for potential collective redress proceedings by such organisations in other EU countries. It follows from the Proposal that the Minister for Legal Protection (Minister voor Rechtsbescherming) will identify the organisations that will be included on the list.