Short Reads

Legislative Proposal introducing class actions in the Netherlands before House of Representatives

Legislative Proposal introducing class actions in the Netherlands

Legislative Proposal introducing class actions in the Netherlands before House of Representatives

05.12.2016 NL law

While the Netherlands is already considered an attractive jurisdiction for claimants bringing cartel damages actions, a new legislative proposal is likely to further enhance the popularity of the Dutch jurisdiction for such proceedings and other class actions. On 16 November 2016, the Dutch Minister of Security and Justice (Minister van Veiligheid en Justitie) submitted a legislative proposal to the House of Representatives (Tweede Kamer), aimed at introducing a US-style 'class action' in the Netherlands.

The Proposal introduces the option to claim damages in a collective action. Under current law, collective actions are limited to requesting a declaratory judgment. Once such a declaratory judgment has been issued, each claimant may initiate individual proceedings to obtain damages, or seek to agree on a collective settlement with the tortfeasor(s) that can be declared binding (a WCAM settlement). However, a collective action for damages is impossible under current law. The Proposal would fundamentally change this.

The Proposal provides for an "opt-out" regime, whereby a representative foundation (stichting) or association (vereniging) brings a claim on behalf of a defined class. The individual claimants falling within that definition are included in the class by default, and need to actively withdraw (in writing) should they not wish to be bound.

Under the Proposal the District Court of Amsterdam will be the designated court for class actions. This will allow the court to build up expertise. In addition, if proceedings are initiated by more than one foundation or association, the court will appoint the one it deems most suitable as the "Exclusive Representative" for all victims.

The Proposal includes a 'scope rule', under which a class action can only proceed if the case has a 'sufficiently close connection' with the jurisdiction of the Netherlands. That threshold, however, is not very high. The Proposal provides that if (i) a majority of the victims represented by the group reside in the Netherlands, or (ii) the defendant has a residence in the Netherlands, or (iii) the event (or events) on which the claim is based, takes or took place in the Netherlands, a sufficiently close connection exists. Thus, the class is not necessarily limited to Dutch claimants. If the defendant resides in the Netherlands, the class will potentially cover victims worldwide.

In terms of its geographical scope, the proposed Dutch class action regime is unprecedented. Other European Member States have introduced or are considering introducing "opt out" class action regimes that are limited to their own residents. The Dutch Proposal goes (far) beyond that. However, the Proposal has received strong criticism. It remains to be seen whether it will be adopted in its current form.

This article was published in the Competition Law Newsletter of December 2016. Other articles in this newsletter:

1. European Commission publishes study on the passing-on of overcharges 

2. Belgian Competition Authority closes investigation into Most Favoured Nation clauses in Immoweb contracts 

Team

Related news

07.02.2019 NL law
The ACM follows EU approach in its first pharmaceutical merger

Short Reads - The Dutch Authority for Consumers and Markets (ACM) recently reviewed its first merger between two pharmaceutical companies. In its conditional clearance of Aurobindo's acquisition of certain European Apotex assets, the ACM followed the European Commission's approach in assessing the merger's impact on competition. Companies will welcome the news that pharma mergers will be reviewed in a similar fashion, irrespective of whether the ACM or the European Commission conducts the review.

Read more

07.02.2019 EU law
Digitisation and competition law: past, present and future

Short Reads - It is nearly time for the European Commission to reveal its course of action in digitisation and competition law. Feedback from a public consultation and the recent conference on 'Shaping competition policy in the era of digitisation' together with the upcoming expert panel's report on the future challenges of digitisation for competition policy are likely to shape the Commission's course of action.

Read more

07.02.2019 NL law
Follow-on cartel damages claim dismissed: don't bury courts under paper work

Short Reads - A recent ruling by the Dutch Court of Appeal confirmed that claimants will need to sufficiently substantiate their claim that they suffered loss due to a cartel, even in follow-on cases. Despite a presumption that sales or service contracts concluded during the cartel period have been affected by the cartel, claimants will still need to provide the courts with concrete, detailed and uncluttered information showing (i) which party purchased (ii) which products from (iii) which manufacturer for (iv) which amount, preferably with copies of the relevant agreements.

Read more

07.02.2019 NL law
The need for speed in mergers is no reason to ignore rights of defence

Short Reads - On 16 January 2019, the European Court of Justice clarified the procedural guarantees the European Commission needs to provide to merging parties during merger reviews. According to the Court of Justice, the General Court (GC) had rightly annulled the Commission's decision to prohibit the merger of UPS and TNT. UPS's right of defence had been infringed because the Commission had failed to share the final version of the econometric model with UPS before adopting its prohibition decision.

Read more

28.01.2019 LU law
The Grand Duchy of Luxembourg implements the Register of Beneficial Owners Law

Articles - The Grand Duchy of Luxembourg has fulfilled its European obligations in the fight against money laundering and the financing of terrorism by transposing Directive 2015/849 of 20 May 2015 (also known as the 4th EU AML Directive) into national law with the brand new Law of 13 January 2019 (the RBE Law). Below is an overview of the important disclosure obligations that will soon apply to a wide range of Luxembourg entities.

Read more

Our website uses cookies: third party analytics cookies to best adapt our website to your needs & cookies to enable social media functionalities. For more information on the use of cookies, please check our Privacy and Cookie Policy. Please note that you can change your cookie opt-ins at any time via your browser settings.

Privacy – en cookieverklaring