Collective Redress Mechanisms Research Articles

Article: The Great Saga of Collective Redress in EU Competition Law: All Cry and No Wool?

The paper presents the evolution of attempts at regulating antitrust collective redress in Europe, and the omission of listing competition law infringements in the annex to Directive 2020/1828 on consumer collective actions and thus from its scope of application. It attempts to understand why the non-availability of antitrust collective actions is the result of the long-lasting drafting processes on the EU level that typically covered competition law, taking into account that the collective redress mechanism is the only real option for consumer private enforcement of antitrust. It calls for the European Commission, the European legislator and the Member States to finally regulate collective actions in the field of competition law as otherwise access to justice for victims of antitrust breaches is not guaranteed. consumer collective redress, collective actions, antitrust collective actions, Directive 2020/1828, Directive 2014/104, follow-on, scope of application, antitrust, competition law

The EU private international law framework for civil disputes concerning credit ratings: Exploring the status quo and prospects of reform

This article addresses the EU private international law framework for cross-border disputes concerning credit ratings. It argues that investors harmed by faulty ratings face considerable challenges when enforcing claims against credit rating agencies. These challenges arise not only due to the high standard of proof for damages claims and additional barriers rooted in substantive law but also from the limited territorial reach of the common EU civil liability regime of Article 35a of the amended Regulation (EC) No 1060/2009. Additionally, uncertainties concerning the determination of the concurrently applicable national law and the lack of unified European cross-border collective redress mechanisms in the area of capital markets law compound the problem. Against this background, this article discusses the options for reforming the existing private international law regime to enhance investors’ access to justice in disputes with CRAs.

Litigating the Algorithmic Boss in the EU: A (Legally) Feasible and (Strategically) Attractive Option for Trade Unions?

Workers subject to algorithmic management, both in platform work and in conventional employment settings, often face a justice gap in enforcing their rights, due to the opacity characterizing most automated algorithmic decision-making processes. This paper argues that trade unions are in a more favourable position than individual workers to fill this justice gap through litigation, especially when collective redress mechanisms are available. However, this becomes possible only when the legal system is favourable to this type of litigation. This article analyses three legal domains at EU level where justiciable rights are more likely to be violated through algorithmic management devices, in order to assess whether it is legally feasible for trade unions to promote algorithmic litigation under EU law. Even when the legal framework is conducive to this type of litigation, it cannot be automatically expected that trade unions will more frequently resort to it to better enforce the rights of workers subject to algorithmic management devices. Previous research shows that trade unions are traditionally keen on turning to litigation only when they are able to link it to their broader strategies. This paper claims that this may be the case against employers using algorithmic management. For trade unions, resorting to litigation can be strategically instrumental not only to fulfil the legal purpose of alleviating the justice gap faced by workers through a better ex post enforcement of their rights, but also to achieve the meta-legal purpose of mobilizing them and the para-legal purpose of strengthening collective bargaining, especially considering that this would constitute an effective means to induce stronger ex ante compliance. Algorithmic Management, Platform Work, Algorithmic Transparency, Algorithmic Discrimination, Employment Protection, Data Protection, Trade Unions, Algorithmic Litigation, Collective Redress, Legal Mobilization, Collective Bargaining

Is it Still Too Early for Collective Redress in Arbitration? – The Boundaries and Opportunities in European Perspectives

As has been often stated in judicial practice, collective redress simply reflects the rise of mass production, the diversification of corporate ownership, the advent of the mega-corporation, and the recognition of environmental wrongs. Although the American opt-out class actions are the first thing that comes to mind when one thinks of collective redress, European legislators have been particularly wary regarding the possibility of the US “toxic cocktail" finding their way into European legislations. On the other hand, arbitration, in its basis, is a private way of resolving disputes which is a creation of the parties in the dispute. In its basis there must be consent of the parties to submit the particular dispute to be resolved in arbitration proceedings. Therefore, the possibility to incorporate collective redress mechanism in arbitration proceedings might raise many questions.

Collective redress mechanisms in minority protection: the case of Hungary

Collective redress mechanisms in minority protection: the case of Hungary

Consumer Collective Redress in Bosnia and Herzegovina: A Mechanism (Still) Waiting to Be Triggered

Bosnia and Herzegovina has been one of the first European states to introduce a generous consumer collective redress mechanism. It was established under the influence of the EU, the United States and former Yugoslav law. The legislation of Bosnia and Herzegovina provides an excellent opportunity to examine to which extent the collective redress remedies emanating from different legal traditions may co-exist and function together. The number and variety of collective consumer remedies in Bosnia and Herzegovina is quite impressive. But the mechanism has still not been used because of the weaknesses of those who are supposed to trigger it. The very generous solutions for consumer associations and a specialized Ombudsman for Consumer Protection, both with wide powers to initiate collective proceedings, have not proved to be sufficient. The lack of appropriate funding has so far been an obstacle that is too great for any collective initiative. It also does not help that legislation allows traders to file for compensation in the case of unfounded collective claims when the reputation and business of the trader have been seriously harmed. The new EU Directive on consumer representative actions will certainly require further reforms in Bosnia and Herzegovina, especially with regard to collective claims for damages. This will provide the legislator with the opportunity not only to introduce more options for collective redress, but also to add the missing pieces of the jigsaw so that the mechanism finally fulfils its purpose of providing legal protection for consumers.

Collective redress and workers’ rights in Slovenia

In 2017, the Collective Actions Act introduced a new type of lawsuit – the collective action – into the Slovenian legal order. A collective action can be lodged in cases of instances of so-called ‘mass harm’, including mass violations of workers’ rights. This could improve the effectiveness of enforcement of workers’ rights in practice. Instead of a number of individual labour disputes concerning the same or similar violations of workers’ rights, a collective action can be lodged by trade unions or other representative collective actors in this field. Both opt-in and opt-out approaches are possible and the decision on this is left to the discretion of the court. Despite many positive aspects, only one collective action in the area of labour rights has been lodged to date. In this contribution I analyse legal regulation of the existing collective redress mechanism and possible reasons for deficiencies discerned in its functioning in practice.

Collective redress in labour and social law disputes: An (attractive) option for the EU?

Collective redress has a lot of appeal as an enforcement tool, but historically it has been seen as somewhat unfitting for the European legal landscape. Despite this, many EU national legal systems have introduced collective redress mechanisms. The area of EU labour and social law, however, has been slow to catch up with this trend. This article discusses whether collective redress in labour and social law disputes could be an attractive option for the EU. Relying on an analysis of the legal opportunity structure it proposes some ideas on how to advance. All in all, collective redress is no panacea but could potentially complement and improve the EU enforcement toolbox, particularly in areas where there is evidence of persistent enforcement gaps.

Collective redress and workers’ rights in the Netherlands

This contribution discusses the Dutch possibilities of collective redress in the domain of labour law. More specifically, it examines the legal options of bringing collective actions and obtaining collective redress in Dutch courts in labour cases, and elaborates on the relevant legal framework as well as the extent to which these opportunities have been used in practice. Findings imply that the Netherlands was among one of the first European countries to introduce a general collective action system. This general collective action regime allows unions and other interest groups to raise cases to protect workers’ rights, even outside the scope of collective labour agreements. Such a collective action regime, however, is not commonly used in practice. Nevertheless, as of January 2020 the admissibility criteria for this general collective redress mechanism have been expanded and it has become an ‘opt-out’ regime, without the need for individual workers to initiate individual follow-up proceedings in the event of a successful case. The latter could improve the effective enforcement of workers’ rights in practice and could provide an incentive for trade unions and other organisations that are active in the protection of workers’ rights to incite a collective action.

ALIGNING THE BRUSSELS REGIME WITH THE REPRESENTATIVE ACTIONS DIRECTIVE

AbstractEuropean private international law has long been recognised as improperly set up to deal with cross-border collective redress. In light of this shortcoming, it seems unfortunate that the private international law implications of the Representative Actions Directive (Directive (EU) No 2020/1828) have not yet been addressed coherently by the European legislator. This article examines to what extent the policy of promoting collective redress can be supported, even if only partially, through a reinterpretation of the jurisdictional rules of the Brussels Ia Regulation. Furthermore, it discusses which legislative measures need to be adopted to better accommodate collective redress mechanisms within the Brussels regime.

Antitrust Damages, Consumer Harm, and Consumer Collective Redress

The European Union (EU) Antitrust Damages Directive (Directive) was enacted in December 2014 after nearly a decade of consultations—its implementation was due by 27 December 2016.1 The Directive entails a number of requirements reforming the Member States’ substantive and procedural law, thereby specifying the European damages regime. It seeks to boost private enforcement and, in particular, to enable each purchaser that suffers damage due to infringements of competition law to claim compensation. The main objective of the Directive is the attainment of ‘full compensation’, with ‘deterrence’ being stipulated as an important secondary goal.2 ... This paper brings into focus the harm borne by final consumers. Any infringement which raises prices to final consumers, either directly or indirectly through the supply chain, may harm such consumers in two different ways. First, final consumers who made some purchases during the infringement period (e.g. at the time a cartel was in place) may have done so at inflated prices. We refer to this as the ‘overcharge effect’. Second, final consumers who refrained from purchasing (or reduced their purchase volume) during the infringement period only because of the inflated prices, but who would have purchased (more) absent the infringement, suffered from a so-called ‘lost consumption effect’. This damage component, equivalent, in economic terms, to the deadweight loss generated by the infringement, captures the benefits (the utility) that consumers would have derived from all the purchases which did not effectively take place because of the infringement. No matter how straightforward the existence of the ‘lost consumption effect’ may be from an economic point of view, it is very difficult, from a legal perspective, for individual consumers to prove that they would have made a purchase if the prices were lower but refrained from doing so due to the infringement. Hence, we argue that all necessary actions—in particular enabling consumer collective redress mechanisms—should be taken to facilitate compensation for the harm resulting from the ‘overcharge effect’ in order to guarantee that the final consumers benefit, at least, from viable enforcement mechanisms related to that share of their overall harm. In this paper, we present the economic and legal arguments supporting our views.

The Funding of Collective Redress by Entrepreneurial Parties: The EU and Dutch Context

The development of collective redress in practice depends on the availability of adequate funding. In recent years third-party funding by entrepreneurial parties has become an important source of financing collective actions and settlements. Both at the EU level and in most of the Member States third-party litigation funding and related forms of entrepreneurial lawyering have generally been viewed with suspicion, though the new Representative Actions Directive (RAD) does enable third-party funding under certain conditions. The Netherlands is perhaps the Member State best known for its collective redress mechanisms, and the role of third-party funding has been important for its development. This paper discusses the financing of collective redress from a European and Dutch perspective. It assesses in how far EU law, and in particular the RAD, enables the third-party funding and how this has developed in the Netherlands. It concludes that the reluctance in Europe towards third-party funding is still visible, but the RAD and recent developments in the EU acknowledge its importance. As to the Netherlands, considering some restrictions in the latest legislative addition enabling collective action damage claims, it remains to be seen what role Dutch collective redress and developing funding mechanisms will play in Europe and beyond.

CONSUMER PROTECTION IN PRACTICE – A TRANSNATIONAL COMPARATIVE ACCOUNT OF COLLECTIVE REDRESS MECHANISMS (Part two: the Dutch and the English approaches)

CONSUMER PROTECTION IN PRACTICE – A TRANSNATIONAL COMPARATIVE ACCOUNT OF COLLECTIVE REDRESS MECHANISMS (Part two: the Dutch and the English approaches)

The Italian Class Action Reform: A Redesigned Tool beyond Consumer Law

Given the globalized scale of the current economic system, effective collective redress mechanisms represent a fundamental tool for consumers and citizens. While in the United States collective actions constitute a common instrument, in the European context their development has been more complex. After a Recommendation issued by the European Commission in 2013, several models have been adopted or reformed across Europe. The regulatory competition approach has been preferred in respect of the simple harmonization of the several national rules. In particular, the French system adopted a completely new tool, the action de groupe, in 2014, while in the UK an option for opt-out collective actions has been recently introduced. The debate over reform of collective redress has also flourished in Italy, leading to the adoption of Law No. 31 of 2019, which will enter into force in November 2020 and will completely redesign the Italian collective action model. This reform has broadened the scope of such a remedy, which has also been made available outside the consumer law field. Moreover, the opt-in system has been strengthened, by allowing adherents to join the claim after the decision on the merits issued by the court. The latter solution embodies a transplant of the action de groupe. In the meantime, the European Union has reawakened its interest in the collective redress field and has drafted a directive proposal, which was approved by the Council of the EU in November 2019. This article will analyse the new Italian reform in a comparative perspective with the French model. collective action; class action; collective redress; consumers; damages; tort law; Italy; Italian law; France; French law; reform; compensation; comparative law; European Union.

Private Enforcement in the UK: Effective Redress for Consumers?

This chapter assesses how private enforcement of competition law rights has developed in the UK over the last twenty years. Key legislative developments, inter alia the Competition Act 1998, Enterprise Act 2002 and Consumer Rights Act 2015, have transformed the private enforcement architecture, notably with the introduction, and increasingly significant role, of the specialist tribunal, the Competition Appeal Tribunal, and the availability of an opt-out collective redress mechanism. This chapter will assess the key UK statutory and case-law developments, in comparison with the USA private antitrust enforcement model, to consider in particular the extent to which an effective system for consumer redress has been instituted. The chapter concludes that the anticipated Supreme Court ruling in Merricks should help to determine whether the opt-out collective proceedings scheme will provide effective consumer redress and ensure that the vibrant private enforcement framework in the UK translates from business claimants to consumers in the third decade of the modern UK competition law.

Towards a harmonised collective redress mechanism for the private enforcement of EU competition law

The paper investigates the collective redress mechanisms in the EU and tries to highlight the importance of harmonizing an effective collective redress mechanism. The Recommendation was a landmark in this development, and even thought it proposes a general collective solution, it is not binding for the Member States. The New Deal for Consumers package consists a proposal on representative actions for the protection of the collective interests, but it focuses only on consumers. This paper searches for an effective legal redress for those, who suffered mass harm from the infringement of EU competition law.

Employment relations via the web with international elements: Issues and proposals as to the applicable law and determination of jurisdiction in light of EU rules and principles

The article addresses the issues of which, from the EU perspective, are the applicable law and the competent courts in respect of employment contracts/relationships performed via the web and characterised by international elements. The study adopts a legal-regulatory approach, focusing, on one hand, on the issues related to the applicable law and, on the other hand, on those concerning the determination of the competent courts in respect of employment contracts/relationships performed via the web and characterised by international elements. The article outlines the possible detrimental effects on the weaker party of the contractual relationship, deriving from the application of the current connecting factors based on EU rules and regulations, in respect of the applicable law and the competent courts. The article considers only the EU legal framework, but suggests an evolutionary interpretation of EU law, aimed at preserving the anti-dumping rationale underlying the legal regime governing the applicable law and investigates the potential of collective redress mechanisms.

From Injunction and Settlement to Action: Collective Redress and Funding in the Netherlands

The Netherlands is internationally known for its collective settlement mechanism that was introduced in 2005. In a small number of cases with a global outreach this settlement regime has proven to be effective. However, its application relies on the willingness to conclude a settlement agreement and to have it declared binding by the court. A collective action regime had been in place for decades, but was limited to injunctive and declaratory relief. After years of discussion the collective redress system was ‘upgraded’ by introducing a collective action procedure for damages in 2020. While the intention behind this latest addition can be welcomed as an effective collective action system in this regard was lacking, some of its features are also subject to criticism and have raised doubts as to whether the new Act is an improvement. That is especially the case with respect to actions filed for declaratory and injunctive relief by so called ‘ideological claimants’. Another crucial aspect for the effectiveness of collective redress mechanisms in general, but particularly with respect to monetary relief, is the availability of funding. The different modes of financing litigation, are the topic of extensive debate. In particular third-party funding as a solution to enable expensive collective actions to take place, has gained critical attention in Europe, even though it may prove to be the only available or viable funding option in the international context. This chapter dis-cusses developments in collective redress in the Netherlands with a focus on the issue of funding and on the position of the Netherlands collective redress regime in the European and international context. It concludes that if the Netherlands is to continue to hold its predominant position in Europe in relation to collective redress, that will not be because of the new law, but because of the creativity of lawyers, the pragmatism of the Dutch courts and the willingness of funders to rely on both.

More Efficient Collective Redress Mechanisms? Will the New Deal Directive on Representative Actions for Protecting the Collective Interests of Consumers Improve the Resolution of Mass Harm Situations in the Visegrad 4 Countries

Classic injunction actions before a court are very rarely used instruments in the Visegrad 4 countries; they are too expensive, too long proceedings, with uncertain results. On one hand, a lost court case can cause insolvency for the organization and on other hand a won case cannot ensure a direct compensation of the harmed consumer. Therefore, the Visegrad 4 consumer protection organizations tend to move to other redresses. After a short introduction to existing injunction actions and their shortcuts in the Visegrad 4 counties (1); the article explains why the way of amending representative actions, as recommended by the new Commission Proposal cannot provide more efficient or effective justice in the Visegrad 4 countries (2); and based on the best practices of the Visegrad 4 countries I will propose alternative instruments, such as public enforcement and more flexible enhanced consumer measures by administrative authorities, which have proved quite efficient in resolving mass harm situations (3). Mass harms, injunction, collective redress mechanism, public enforcement, consumer compensation, Visegrad 4 countries, more flexible enhanced consumer measures, efficient enforcement

The Concept of Locus Standi in Collective Protection of Consumer Rights – the Pitfalls of Transposition of European Model into the Czech Legal Order

Summary The paper deals with collective protection of consumer rights from the European and Czech point of view. The attention is focused on the question of the concept of legal standing to bring a collective actions (i.e. locus standi) The article compares the legal regulation of legal standing to bring a collective action in the Commission Recommendation of 11 June 2013 on common principles for injunctive and compensatory collective redress mechanisms in the Member States concerning violations of rights granted under Union law (2013/396/EU), in the proposal a new Directive of the European Parliament and of the Council on representative actions for the protection of the collective interests of consumers [COM/2018/184 final-2018/0089 (COD)] and the Czech bill for the Collective Redress Act.