Strength in numbers for Belgian consumers

  • Government approves “class action” bill
  • Certain adverse effects now feared
  • But Test-Achats feels this will restore the balance between consumers and private companies

While David may not have quite drawn blood, Goliath has certainly been dealt a significant blow in the ongoing battle between consumers and commerce. To battle giant companies that do not always respect the rules of the game, the man in the street has a new weapon, “class action”. In a few months’ time, this will allow Belgian customers who feel wronged by a commercial business to bring a collective claim to court. The draft bill, introduced by Johan Vande Lanotte (SP.A party), minister of consumer affairs, was adopted at first reading by the government last week.

Up to now, when a consumer felt aggrieved to the tune of a few dozen Euros, he would be deterred from taking the company involved to court by the slowness and complexity of the process and the lack of a shared approach available for recouping losses. Some businesses had not been slow to take advantage of this situation. From this point on, however, the landscape has changed, as plaintiffs can now gather behind one, single representative.

Is there now a risk of the number of claims of this type multiplying? To avoid “American-style” downward spirals, the legislator has put in place certain safeguards. Therefore, any group wishing to engage in a class action must be represented by an organization approved by the minister (Test-Achats, Deminor or the Ligue des Familles for example), one which has been active for at least three years, has no commercial interests and possesses a legal personality (which rules out unions). The objective was to prevent specialized law firms from encouraging their clients from going to court on a whim. In addition the procedure will begin by a mandatory negotiation stage.

“This sort of protection for consumers not only gives them rights, but it also provides them with the means necessary to exercise them,” said Vande Lanotte. Having been calling for its introduction for the best part of 20 years, Test-Achats is also satisfied with the measure which already exists in the United States and some European countries (Italy, Portugal and the Netherlands).

“Up to now, we had the possibility of issuing injunctions which brought about the end of the act in question, but it did not allow for compensation to be provided to plaintiff customers,” explains Jean-Philippe Ducart, a spokesman for the consumer rights organization. “In the future, this aspect will be addressed.” He cites the examples of DKV (a health insurance provider) which had increased the price of some of its products without correctly warning its customers. The risk of a class action will likely encourage the company to take greater care.

Organizations representing groups of clients will also have another advantage – workload. “In the Lernout & Hauspie case there were thousands of wronged claimants,” recalls Ducart. “In tandem with Deminor we came up with a solution where there was a separate, individual claim each time. In the United States claimants received compensation while over here the case got bogged down. A class action would have facilitated things and moved the case forward to an out-of-court settlement or to full-blown legal proceedings.”

 

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