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

28.07.2022 NL law
Purely commercial interest also a legitimate interest? Council of State leaves the question unanswered.

Short Reads - On 27 July 2022, the Council of State confirmed that the Dutch Data Protection Authority wrongly imposed a €575,000 fine on VoetbalTV. But the Council did not answer the question whether the AP rightly or wrongly believes that a purely commercial interest cannot be a legitimate interest within the meaning of the General Data Protection Regulation.

Read more

20.09.2022 EU law
Launch of Metaverse blog series

Articles - Stibbe launches a new blog series focusing on the legal challenges of the Metaverse. In our upcoming blog posts, we will discuss the legal challenges of NFTs, crypto-assets, Metaverse platforms, crypto exchanges, DAO, and many more.

Read more

28.07.2022 NL law
Zuiver commercieel belang ook gerechtvaardigd belang: Raad van State laat zich er niet over uit

Short Reads - Op 27 juli 2022 heeft de Raad van State bevestigd dat de Autoriteit Persoonsgegevens onterecht een boete van € 575.000 aan VoetbalTV heeft opgelegd. De hoop bestond dat de Afdeling antwoord zou geven op de vraag of de AP terecht of onterecht meent dat een zuiver commercieel belang géén gerechtvaardigd belang kan zijn in de zin van de Algemene Verordening Gegevensbescherming. Het antwoord op deze vraag blijft echter uit.  

Read more

03.08.2022 EU law
Gotta catch ‘em all? Upward referral of ‘killer acquisitions’ upheld

Short Reads - Companies involved in intended or completed M&A transactions falling below EU and national merger notification thresholds should beware that their deals may still catch the European Commission’s eye. The General Court has upheld the Commission’s decision to accept a national referral request regarding Illumina’s acquisition of Grail: a transaction not triggering any of the notification thresholds within the EEA.

Read more