Consumer law class action

Bill of law 7650 (“Bill ”), which was recently presented by the Government, aims to introduce a class action procedure allowing for the compensation of damages suffered by a group of consumers resulting from the same illicit behaviour by, or practice of, a professional.

Inspired by Belgian and French precedents, the Bill anticipates the adoption by the European Union of what is still a proposal for a directive   on representative actions for the protection of the collective interests of consumers.

According to the Bill, class actions could be brought before the court, and the group represented by, either a consumer who is part of the group or a qualified entity such as, in particular, a consumer organisation. If successful, a judge could order a cessation or prohibition of a wrongful or illegal practice, as well as a compensation for damage suffered by the group of consumers.

Several categories of disputes would nevertheless be excluded from the proposed class action procedure, such as:

Disputes in relation to anti-competitive practices; and
Disputes between consumers and professionals supervised by the Commission de Surveillance du Secteur Financier (CSSF) or the Commissariat aux Assurances (CAA), except those concerning consumer loans, mortgage loans, as well as contracts for financial services concluded remotely and insurance contracts concluded remotely.

The Bill provides for several procedural particularities, such as, inter alia, an admissibility pre-phase during which a judge shall rule whether the specific admissibility conditions provided for by the Bill were respected, the possibility for the judge to determine whether to apply an opt-in or an opt-out procedure, the possibility for a consumer representing the group to sue (as opposed to reserving the class action procedure to qualified entities) as well as the appointment of a liquidator for the distribution of the amounts allocated to the consumers.

An update will be circulated as soon as the Bill is adopted by Parliament.