15/08/2020

On 14 August 2020, the Minister for consumer protection tabled bill of law 7650 introducing collective recourse procedures into consumer law.

Under the bill’s current language, it will be possible for a representative consumer or entity to initiate a collective action on behalf of a group of prejudiced consumers against professionals for a breach of their legal or contractual duties, or for wrongdoing established during a cessation action.

Entities under the supervision of the Commission de Surveillance du Secteur Financier or the Commissariat aux Assurances (in most cases) do not currently fall within the scope of the bill, and are therefore ineligible to be defendants in collective actions.

The procedure will be divided into two different phases: an admissibility phase and a merits phase. During the admissibility phase, topics such as consumer representation and class action financing will come under scrutiny of the Court.

During the merits phase, the Court will be asked to issue judgment determining the professional’s liability, identifying the group of prejudiced consumers and the detriment done to them, identifying the measures that should be taken to hold the consumers harmless and identifying whether the class of consumers is subject to an opt-in or opt-out system.

In its judgment on the merits, the Court will also be asked to appoint a liquidator whose duties will be to oversee and to ensure enforcement of the merits judgment until all consumers have been held harmless by the professional.

A simplified procedure is also currently planned for cases in which the number and identities of prejudiced consumers are known and in which they have suffered broadly equivalent harm.

With a view to promoting alternative dispute resolution, the parties will have to attend a compulsory information meeting on mediation following the admissibility judgment. After this meeting, the parties remain free to choose to mediate according to the procedure set out in the bill of law, in the presence of a mediator who is specially qualified in class action mediation.

Contacts

François Kremer

Partner

Commercial & Insolvency, Litigation & Dispute Resolution

Ariel Devillers

Counsel

Litigation & Dispute Resolution

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