EU Legislation Normative texts

Collective Redress: Legal Affairs Committee Confirms Parliament’s Negotiating Position on New EU Legislation

According to a press release published on 9 January 2020, the MEPs can soon start negotiating the final shape that the legislation will take with Council. The Legal Affairs Committee confirmed the European Parliament’s negotiating position with 20 votes in favour and 2 abstentions.

The draft rules allow eligible entities, such as consumer organisations and certain independent bodies, to seek remedy, including compensation; enforce a high level of protection; and to represent the collective interest of consumers. Collective action would be authorised against trader violations, in domestic and cross-border cases, in areas such as data protection, financial services, travel and tourism, energy, telecommunications, environment and health.

The text approved by MEPs on 26 March 2019 also introduces the “loser pays principle”, which ensures that the losing party reimburses the winning party’s legal costs, to avoid abusive use of the new instrument. The proposed legislation reflects concerns raised by mass harm scandals with cross-border implications, e.g. Dieselgate and Ryanair.

The new rules would strengthen the right to access to justice by allowing consumers to join forces across borders and to jointly request that unlawful practices be stopped or prevented (injunction), or to obtain compensation for the harm caused (redress).

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