A major step forward for the collective defence of consumer rights was taken on Monday 23 November with the creation of a European right of collective redress for consumers who fall victim to the illegal practices of large companies, regardless of the Member State where these infringements of EU law are committed.
The European Parliament has paved the way for the adoption of a directive that will introduce collective redress procedures in the EU, initiated by qualified entities representing consumers deliberately harmed by unfair corporate practices in breach of EU law.
MEPs approved the EU Council’s position at second reading, thereby endorsing the interinstitutional agreement reached in June on a proposal made in June 2018 in response to the ‘dieselgate’ scandal and to Ryanair flights that were cancelled without compensation for consumers (see EUROPE 12517/15, 12512/2).
“It is a change in ambition and scope that we are proposing to all citizens. Together, we are in a position to offer a new concrete right to European citizens, one that will enable them to join together to seek redress if they suffer damage as a result of an illegal practice by a multinational company”, welcomed rapporteur Geoffroy Didier (EPP, France).
Until now, 10 Member States had no such procedure. “Faced with airlines, big banks, and industrial companies, a consumer on his own would not take legal action, because justice is long, costly and uncertain and, above all, it was impossible to bring an action in another Member State”, he recalled during the debate.
Qualified entities (associations or public bodies) designated in each Member State will be empowered and financially supported to initiate injunctive and remedial actions on behalf of consumer groups and will guarantee consumers’ access to justice.
For cross-border redress, entities will have to comply with a set of harmonised criteria. For national redress, Member States will themselves set the criteria consistent with the objectives of the Directive.
Safeguards have been provided to avoid abusive actions, such as the principle that the loser pays the costs of the proceedings.
The scope covers data protection, financial services, travel and tourism, energy, telecommunications, health services, and air and rail passenger rights.
Before the MEPs, the European Commissioner for Justice, Didier Reynders, welcomed a “balanced agreement”, both for the system’s operations and for control of financing for representative actions and support for qualified entities.
He also welcomed “a scope broad enough to cover all violations of consumer rights beyond the traditional scope of consumer protection”.
Considered adopted, the Directive will enter into force 20 days after its publication in the Official Journal of the EU. Member States will then have 24 months to transpose it into national law and a further 6 months to begin enforcing it. (Original version in French by Aminata Niang)