Europaudvalget 2019-20
KOM (2018) 0184 Bilag 3
Offentligt
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DELIVERING
COLLECTIVE REDRESS
IN EUROPE:
NEW TECHNOLOGIES
Professor Dr Christopher Hodges
Professor of Justice Systems, and Fellow of Wolfson College, University of Oxford
Head of the Swiss Re Research Programme on Dispute Resolution Systems, Centre for Socio-Legal Studies
Fellow, European Law Institute
 kom (2018) 0184 - Bilag 3: Henvendelse af 13/11-19 fra DI, Dansk Erhverv og Forsikring og Pension vedr. direktivforslag om forbrugernes kollektive interesser (gruppesøgsmål)
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Collective Redress in the EU
-
2006 Leuven Report on Alternative Means of Consumer Redress
EU Consumer Policy Strategy 2007-2013
2008 Green Paper on Consumer Collective Redress
2009 Consultation Paper for Discussion on the Follow-Up to the Green Paper
2010 Joint Information Note
2011 Public Consultation
2012 European Parliament Resolution Towards a Coherent European Approach to
Collective Redress
2018 Proposal on Representative Actions
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 kom (2018) 0184 - Bilag 3: Henvendelse af 13/11-19 fra DI, Dansk Erhverv og Forsikring og Pension vedr. direktivforslag om forbrugernes kollektive interesser (gruppesøgsmål)
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European Commission DG SANCO, MEMO/08/741, p 4
“U.S. style class action is not envisaged. EU legal systems are very different from the
U.S. legal system which is the result of a “toxic cocktail” – a combination of several
elements (punitive damages, contingency fees, opt-out, pre-trial discovery procedures).
… This combination of elements – “toxic cocktail” – should not be introduced in Europe.
Different effective safeguards including, loser pays principles, the judge’s discretion to
exclude unmeritorious claims, and accredited associations which are authorised to take
cases on behalf of consumers, are built into existing national collective redress schemes in
Europe.
All the Green Paper options, and in particular a possible EU collective procedure outlined
above, reflect EU legal traditions. The Commission seeks to encourage a competitiveness
culture e.g. where businesses which play by the rules can realise their competitive
advantages, not a litigation culture.
”
 kom (2018) 0184 - Bilag 3: Henvendelse af 13/11-19 fra DI, Dansk Erhverv og Forsikring og Pension vedr. direktivforslag om forbrugernes kollektive interesser (gruppesøgsmål)
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Safeguards in Collective Actions
•
Stand-alone
instead of follow-
on
•
Opt-in instead of
opt-out
•
Restriction of
standing to
certified
personnel
•
Independent
governance
•
Certification by
Court
•
Certification
criteria
•
Notice to class
members
•
Judge not jury
•
Identify common
issue(s)
•
Adequacy of
representation
•
Superiority of the
collective
procedure
•
Prioritisation of
other pathways
•
Evaluation of
merits
•
Loser pays
•
No contingency
fees or third party
litigation funding
•
Identical
damages
•
No punitive
damages
•
Court approval of
settlement
•
Court approval of
lawyers’ fees
R. Money-Kyrle and C. Hodges, ‘Safeguards in Collective Actions’ (2012) 19.4
Maastricht Journal of International and Comparative Law
477-504
 kom (2018) 0184 - Bilag 3: Henvendelse af 13/11-19 fra DI, Dansk Erhverv og Forsikring og Pension vedr. direktivforslag om forbrugernes kollektive interesser (gruppesøgsmål)
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Horizontal or Sectoral?
-
2018 Recommendation: “in [all] areas where Union law grants
rights to citizens and companies: consumer protection,
competition, environment protection, protection of personal data,
financial services legislation and investor protection”
antitrust: 2014 Directive on Antitrust Damages Actions
data protection: 2016 General Data Protection Regulation and
Directive
Proposal for a Regulation on the law applicable to the third-party
effects of assignments of claims, COM/2018/096 final - 2018/044
(COD)
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 kom (2018) 0184 - Bilag 3: Henvendelse af 13/11-19 fra DI, Dansk Erhverv og Forsikring og Pension vedr. direktivforslag om forbrugernes kollektive interesser (gruppesøgsmål)
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Class actions:
Belgium, Bulgaria, Denmark, England and Wales, Finland,
France, Israel, Italy, Lithuania, Netherlands, Norway, Poland, Portugal,
Slovenia, Spain, Sweden
Group proceedings:
Austria, England and Wales, Germany, Switzerland
Each national model is different!
 kom (2018) 0184 - Bilag 3: Henvendelse af 13/11-19 fra DI, Dansk Erhverv og Forsikring og Pension vedr. direktivforslag om forbrugernes kollektive interesser (gruppesøgsmål)
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Jurisdiction
Portugal
Spain
Lithuania
Sweden
the Netherlands
Finland
Bulgaria
Denmark
Norway
Italy
Poland
Belgium
France
England & Wales CAT
England & Wales GLO
Year of Introduction
1995
2000
2015
2003
2005
(WCAM)
2007
2008
2008
2008
2010
2010
2014
2014
2015
1999
Number of Cases
179
(2007 – 2015)
N/A
3
(2015 – 2016)
17
(2003 – 2014)
9
(2005 – 2016)
0
N/A
2
(2008 – 2012)
N/A
58 (?)
(2010 – 2016)
210
(2010 – 2016)
5
(2014 –2016)
9 + 1
(2014 – 2016)
2
(2015 – 2016)
101
(1999-2017)
 kom (2018) 0184 - Bilag 3: Henvendelse af 13/11-19 fra DI, Dansk Erhverv og Forsikring og Pension vedr. direktivforslag om forbrugernes kollektive interesser (gruppesøgsmål)
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Other Mechanisms
§
Several Mechanisms
1.
2.
3.
4.
5.
6.
7.
Collective litigation
Civil piggy-back on criminal
Spontaneous
ADR
Consumer Ombudsmen
Personal injury administrative redress schemes
Regulatory redress
§
The consequences of Pluralism:
§
§
Ability to compare: What are the results?
Are the opportunities being seized?
 kom (2018) 0184 - Bilag 3: Henvendelse af 13/11-19 fra DI, Dansk Erhverv og Forsikring og Pension vedr. direktivforslag om forbrugernes kollektive interesser (gruppesøgsmål)
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The Ombudsman Model:
Consumer ADR as market regulation
Some CADR mechanisms deliver redress and behavioural effects,
some do not – it depends on
system design;
UK Ombudsmen do
collective redress as an integral aspect of individual redress
Pan-EU CDR: Directive 2013/11/EU and the ODR Regulation
The Functions that Consumer Ombudsmen can deliver:
1.
2.
3.
4.
Consumer information and advice/Triage
Dispute resolution: individual redress and automatic collective redress
Capture and Aggregation of data
Feedback of information
a)
b)
Identification of issues and trends
Publication
5.
Pressure on market behaviour; NB Dir 2013/11 art 17
 kom (2018) 0184 - Bilag 3: Henvendelse af 13/11-19 fra DI, Dansk Erhverv og Forsikring og Pension vedr. direktivforslag om forbrugernes kollektive interesser (gruppesøgsmål)
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Techniques: an escalating pyramid
Adjudication
binding or
non-binding
Mediation/
Conciliation
Refer to Third Party:
Triage
Direct contact
Consumer - trader
 kom (2018) 0184 - Bilag 3: Henvendelse af 13/11-19 fra DI, Dansk Erhverv og Forsikring og Pension vedr. direktivforslag om forbrugernes kollektive interesser (gruppesøgsmål)
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Financial Ombudsman Service
Initial enquiries &
complaints
2016/17
2015/16
2014/15
2013/14
2012/13
2011/12
2010/11
2009/10
2008/09
2007/08
2006/07
2005/06
2005
2004
2003
1,394,379
1,631,955
1,786,973
2,357,374
2,161,439
1,268,798
1,012,371
925,095
789,877
794,648
627,814
672,973
614,148
562,340
562,340
New cases
Cases resolved
informally by
adjudicators
297,762
398,930
405,202
487,749
198,897
201,793
147,434
155,591
105,275
91,739
104,831
Cases resolved by
ombudsmen
38,619
39,872
43,185
31,029
24,332
20,540
17,465
10,730
8,674
7,960
6,842
321,283
340,899
329,509
512,167
508,881
264,375
206,121
163,012
127,471
123,089
94,392
 kom (2018) 0184 - Bilag 3: Henvendelse af 13/11-19 fra DI, Dansk Erhverv og Forsikring og Pension vedr. direktivforslag om forbrugernes kollektive interesser (gruppesøgsmål)
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Personal Injury Compensation Schemes
§
§
§
§
§
§
§
§
§
§
§
§
§
§
§
§
§
§
§
§
§
§
New Zealand Accident Compensation Scheme
Swedish Road Traffic Injuries Commission
Swedish Patient Compensation
Swedish Drug Insurance
Danish Industrial Injuries Board
Danish Road Traffic Injuries Commission
Danish Patient Compensation
Danish Drug Compensation
Finnish Workers Compensation
Finnish Motor Vehicle Insurance Commission
Finnish Patient Insurance
Finnish Drug Insurance
Norwegian Patient & Drug Compensation
Norwegian Workplace Insurance
L’ Office National d'Indemnisation des Accidents
Médicaux, des affections iathrogènes et des
infections nosocomiaux
(ONIAM)
Polish No-Fault Medical Liability Scheme
German Pharmapool
German medical Schlichtungsstellen
Irish Personal Injuries Assessment Board
Japanese Pharmaceutical Injury Compensation
Scheme
U.S. no fault motor vehicle injuries schemes:
Florida, North Dakota, Colorado
Vaccine Injury Compensation Schemes: eg UK,
USA, Ebola,
§
§
§
§
§
§
§
§
§
§
§
§
The Industrial Injuries Disablement Benefit (IIDB)
The Armed Forces and Reserve Forces
Compensation Scheme
The Criminal Injuries Compensation Scheme
The Mesothelioma Compulsory Insurance Fund and
Compensation Scheme
The Coal Workers Pneumoconiosis Scheme 1974
The Coal Health Compensation Schemes
The Thalidomide Trust
The Skipton Fund for Hepatitis C and HIV
The vCJD Trusts
The ABPI
Guidelines for Compensation in Clinical
Trials
and
Healthy Volunteers
The ABHI Clinical Investigation Compensation
Guidelines
The General Dental Council’s dental Complaints
Service
The NHS Injury Costs Recovery (ICR) scheme
NHS Complaints
The Parliamentary and Health Service Ombudsman
NHS Redress Act 2006
ICI Eraldin
Dow Corning breast implant scheme
Trilucent breast implant scheme
J&J ASR hip reimbursement programme
§
§
§
§
§
§
§
§
 kom (2018) 0184 - Bilag 3: Henvendelse af 13/11-19 fra DI, Dansk Erhverv og Forsikring og Pension vedr. direktivforslag om forbrugernes kollektive interesser (gruppesøgsmål)
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 kom (2018) 0184 - Bilag 3: Henvendelse af 13/11-19 fra DI, Dansk Erhverv og Forsikring og Pension vedr. direktivforslag om forbrugernes kollektive interesser (gruppesøgsmål)
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Regulatory Redress
Denmark
§
Consumer Ombudsman: unique opt-out class action since 2008 and antitrust 2010;
no action yet brought, but the power constantly influences discussions and resolution of cases
UK
§
§
Macrory,
Regulatory Justice: Making Sanctions Effective
(HM Treasury, 2006)
→ Enforcement and Sanctions Act 2008
Redress powers:
Financial Services and Markets Act 2000, s404 [consumer redress scheme] and s404F(7) [single firm scheme]
Energy Act 2013
Competition: CRA 2015: CMA power to approve a scheme
Redress through licence conditions:
water, gambling …
§
§
§
§
§
Consumer: Consumer Rights Act 2015:
Enhanced Consumer Measures
EU
§
§
§
Competition: Deutsche Bahn rail access pricing settlement
Financial services: cases by Central Banks in Ireland, Italy
EU harmonisation of enforcement policy and powers
power to seek or accept commitments: CPC Regulation 2017/2394 art 9.4
 kom (2018) 0184 - Bilag 3: Henvendelse af 13/11-19 fra DI, Dansk Erhverv og Forsikring og Pension vedr. direktivforslag om forbrugernes kollektive interesser (gruppesøgsmål)
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Jurisdiction
Portugal
Year of
introduction
1995
Act
Law 83/95 of August 31,
1995 on the right to take
part in administrative
proceedings and the right
of popular action
2015 Amendments to the
Code of Civil Procedure
(introduction of group legal
actions)
2003 Group Proceedings
Act
2005 Dutch Collective
Settlement Act
2007 Class Action Act
Chapter 23a ( 254a-254k)
Administration of Justice
Act
Number of cases
179 filed
(2007 – 2015)
29 pending in 2015
Lithuania
2002
Sweden
the Netherlands
Finland
Denmark
2003
2005
2007
2008
Italy
2010
Poland
2010
2009 Law no. 99 – Article
140bis Italian Consumer
Code
Class Actions Act of 17
December 2009
- 3 dismissed
- 2 pending
(January 2015 – August
2017)
30-50
(2003 – 2017)
9
(2005 – November 2017)
0
- 66 decided cases
before the district courts
- 3 decided cases before
the courts of appeal
(2008 – 2016)
50-100
(January 2010 –
November 2016)
227+7
(2010 – 2017)
 kom (2018) 0184 - Bilag 3: Henvendelse af 13/11-19 fra DI, Dansk Erhverv og Forsikring og Pension vedr. direktivforslag om forbrugernes kollektive interesser (gruppesøgsmål)
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Jurisdiction
Belgium
Year of
introduction
2014
Act
Number of cases
France
2014
England & Wales
2015
2014 Act Introducing a
- 1 settled
Consumer Collective
- 1 withdrawn
Redress Action in the Code
- 4 pending
of Economic Law
(September 2014 – April
2018)
Articles L.623-1 et seq. and
- 2 settled
R.623-1 et seq. of the
- 9 pending
French Consumer Code
- 1 pending in appeal
(Code de la
(October 2014 –
Consommation) and the
November 2017)
similar procedures in
health, discrimination,
environment, privacy and
data protection law
2015 Consumer Rights Act
- 1 dismissed
(Competition Class Action)
- 1 withdrawn
(2015 – August 2017)
 kom (2018) 0184 - Bilag 3: Henvendelse af 13/11-19 fra DI, Dansk Erhverv og Forsikring og Pension vedr. direktivforslag om forbrugernes kollektive interesser (gruppesøgsmål)
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Case
Year
Nature
Des
2006
2014
2007
Product liability
Number of
class
members
N/A
(17.000
registered)
300.000
(25.000
opt-outs)
Funding
Settlemen
t
€ 38 mil
Fee for
association
N/A
Subsidies
&
donations
€ 45
Contributi
on per
class
member
Funding
by
regulator
Funding
by Shell
Dexia
Financial
product
€ 1 bil
N/A
paid by Dexia
Vie d’Or
2009
Financial
product
Securities
11.000
€ 45 mil
€ 8,5 mil (max)
paid by regulator
$ 12 mil
(association)
$ 47 mil
(U.S. lawyers)
€ 212.000
(maximum)
€ 1,6 mil
$ 11,6 mil
(U.S. lawyers)
N/A
paid by DSB
Bank
Shell
2009
500.000
$ 448 mil
Vedior
Converium
2009
2012
Securities
Securities
2.000
12.000
DSB Bank
2014
Financial
product
345.000
(300 opt-outs)
Contributi
ons
Funding
by
defendant
s
Funding
by DSB
Bank
€ 4 mil
$ 58 mil
€ 500 mil
maximum
The Netherlands Class Settlement Act WCAM
Source: Ilja Tillema, “Tien jaar WCAM: een overzicht” (2016) 3 & 4 MvO 90, at 91-92.
 kom (2018) 0184 - Bilag 3: Henvendelse af 13/11-19 fra DI, Dansk Erhverv og Forsikring og Pension vedr. direktivforslag om forbrugernes kollektive interesser (gruppesøgsmål)
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Performance Indicators for Collective Redress Mechanisms
Advice.
To what extent does the mechanism enable consumers to access advice before or during the processing of
their complaint? To what extent also does the system provide advice to traders, especially small traders who may not be
familiar with the law or dispute resolution options or processes, so as to achieve swift, cost-effective and fair resolutions?
1.
2.
3.
Identification of infringement and harm.
How is it that a problem involving breach of law and/or damage has
occurred is identified?
Identification of people harmed and due redress.
Must individuals come forward, or can they be identified without
coming forward?
4.
5.
Access.
To what extent is the mechanism user-friendly for consumers or claimants to access?
Cost to access.
What cost must a person who claims to have suffered harm pay, and fund, in order to access the
process? Or is access free?
Triage.
To what extent does the mechanism act as a triage to prevent unmeritorious cases or unnecessary cases
proceeding further? This may include, at one extreme, preventing fraudulent claims being advanced and, at the other
extreme, to swiftly resolving cases that should be resolved one way or the other?
6.
7.
Duration.
How long does the mechanism take from start to conclusion? How long does it take to resolve issues, from
when they first arose (i.e. when damage occurred, before a claim was made) to final resolution?
Costs.
How much are the gross transactional costs of a collective procedure, and the standing costs of a process? Who
bears the costs, both initially, and finally?
8.
9.
Outcomes.
What is achieved? Are the outcomes the ones desired by the parties, the law, or society?
10.
Compensation for loss: making whole.
Is a person who has suffered harm fully recompensed? How much of an
award is lost in transactional costs, e.g. of intermediaries? Are extra emotional or other costs incurred and recompensed?
11.
Changes in Behaviour.
Does the mechanism directly produce changes in systemic behaviour that reduces the
incidence or future risk of non-compliance with the law? To what extent does the mechanism, therefore, act as a regulatory
mechanism?
 kom (2018) 0184 - Bilag 3: Henvendelse af 13/11-19 fra DI, Dansk Erhverv og Forsikring og Pension vedr. direktivforslag om forbrugernes kollektive interesser (gruppesøgsmål)
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Mechanism
Collective
Action
Piggy-back
Regulatory
Redress
Simple
ADR
Consumer
Ombudsman
1. Advice
2.
Identification
infringement
2
of 0
1
0
0
3
3
0
2
2
3
3
1
18
1
1
2
3
3
0
3
3
3
3
3
25
0
0
0
2
2
0
-
-
-
-
0
4
3
3
2
3
3
3
3
2
3
3
3
31
3. Identification of people 2
harmed
4. Access
5. Cost to access
6. Triage
7. Duration
8. Costs
9. Outcomes
10. Compensation
11. Behaviour change
Total
2
1
1
1
1
3
2
1
16
 kom (2018) 0184 - Bilag 3: Henvendelse af 13/11-19 fra DI, Dansk Erhverv og Forsikring og Pension vedr. direktivforslag om forbrugernes kollektive interesser (gruppesøgsmål)
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Models of Regulation and
Compliance
 kom (2018) 0184 - Bilag 3: Henvendelse af 13/11-19 fra DI, Dansk Erhverv og Forsikring og Pension vedr. direktivforslag om forbrugernes kollektive interesser (gruppesøgsmål)
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The Aviation Safety Model
To achieve data flow, you need a
no blame culture
§
Open culture
of
questioning
decisions and sharing knowledge of mishaps –
extensive free sharing of information
Just culture
of
no blame,
non-punitive environment and response
Maintain
accountability
by constantly, visibly
contributing
Aims
constant monitoring of
performance
§
constant learning and improving the
system
and its human operation.
§
§
§
§
§
‘No blame’ must operate in
every context:
system regulation, professional
regulation, employment discipline, liability for harm, social
 kom (2018) 0184 - Bilag 3: Henvendelse af 13/11-19 fra DI, Dansk Erhverv og Forsikring og Pension vedr. direktivforslag om forbrugernes kollektive interesser (gruppesøgsmål)
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A Picture of the Future
A Perfect Storm
1.
2.
3.
4.
5.
National Class Actions
Cross-border EU model Class Actions
Claims Management Companies & Litigation Funders
Regulatory Redress
Some ADR
 kom (2018) 0184 - Bilag 3: Henvendelse af 13/11-19 fra DI, Dansk Erhverv og Forsikring og Pension vedr. direktivforslag om forbrugernes kollektive interesser (gruppesøgsmål)
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Suggestion
1.
2.
3.
4.
Lower 261 amounts
Voluntary customer electronic refund
Backed by a simple Ombudsman system
Withdraw the Collective Litigation Proposal!
 kom (2018) 0184 - Bilag 3: Henvendelse af 13/11-19 fra DI, Dansk Erhverv og Forsikring og Pension vedr. direktivforslag om forbrugernes kollektive interesser (gruppesøgsmål)
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Thank you!