Consumer collective redress in the EU : The Loch Ness Monster ? Monique Goyens Director-General Presidency conference Vilnius – 4 October 2013

Why collective redress? No need to repeat because all participants in this room know why collective redress is needed The consumer tool box

Massive divergencies in Member States 16 Member States have some sort of a system in their legislation Various drafts under discussion in a number of Member States All systems differ – Consumers do not enjoy the same possibilities to claim redress in the Single Market – Even though it is often the same infringement that is the cause of complaints in different countries – Single Market does not work in such cross-border disputes

European debate Studies carried out by SANCO and COMP, Green papers and White papers, the draft proposal on private damages in 2009, … Public consultation - Towards a coherent European approach to collective redress in 2011: More than 300 contributions from different stakeholders and more than letters from citizens In 2012 : favourable signals in European Parliament report

BEUC position A binding EU instrument to ensure that a judicial group action mechanism exists in all Member States for both national and cross-border actions

Our main demands Applicable to all consumer issues Aim at obtaining compensation Allow for standing of consumer or user associations Cover national and cross border cases Give the court an active role Foresee both opt-out and opt-in procedures Foresee efficient funding mechanisms

Why businesses fear it Drastic increase in litigation Opt-out – aggregate damages, while with opt-in compensate just part of the victims US class actions ‘imported’ into Europe Blackmail settlements Bankruptcies No evidence of this in MS where collective redress is in place

Effective safeguards Active role of the court: evaluation of merits and of standing, control of notification of individuals, approval of settlement, approval of lawyer fees if allowed,… Loser pays No punitive damages, no wide discovery, no juries (but specialised judges instead) Most of these principles already enshrined in civil procedures, so inherent to European legal traditions Abuses in the US are being tackled. CR also in Canada, Australia, contemplated by Japan etc…

Hope for consumers? Commission recommendation of 2013 – up to Member States to act now – Double disappointment : much ado about so little Non binding EU instrument Opt in approach

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