From Injunction and Settlement to Action: Collective Redress and Funding in the Netherlands

in: Alan Uzelac & Stefaan Voet, Class Actions in Europe: Holy Grail or a Wrong Trail?, Springer 2020

25 Pages Posted:

See all articles by I.N. Tzankova

I.N. Tzankova

Tilburg Law School

Xandra E. Kramer

Erasmus University Rotterdam (EUR) - Erasmus School of Law; Utrecht University - Faculty of Law

Date Written: December 27, 2020

Abstract

The Netherlands is internationally known for its collective settlement mechanism that was introduced in 2005. In a small number of cases with a global outreach this settlement regime has proven to be effective. However, its application relies on the willingness to conclude a settlement agreement and to have it de-clared binding by the court. A collective action regime had been in place for decades, but was limited to injunctive and declaratory relief. After years of discussion the collective redress system was ‘upgraded’ by introducing a collective action procedure for damages in 2020. While the intention behind this latest addi-tion can be welcomed as an effective collective action system in this regard was lacking, some of its fea-tures are also subject to criticism and have raised doubts as to whether the new Act is an improvement. That is especially the case with respect to actions filed for declaratory and injunctive relief by so called ‘ideological claimants’. Another crucial aspect for the effectiveness of collective redress mechanisms in general, but particularly with respect to monetary relief, is the availability of funding. The different modes of financing litigation, are the topic of extensive debate. In particular third-party funding as a solution to enable expensive collective actions to take place, has gained critical attention in Europe, even though it may prove to be the only available or viable funding option in the international context. This chapter dis-cusses developments in collective redress in the Netherlands with a focus on the issue of funding and on the position of the Netherlands collective redress regime in the European and international context. It con-cludes that if the Netherlands is to continue to hold its predominant position in Europe in relation to col-lective redress, that will not be because of the new law, but because of the creativity of lawyers, the prag-matism of the Dutch courts and the willingness of funders to rely on both.

Keywords: collective action, Netherlands, funding, collective redress, consumer representative actions

JEL Classification: K13, K22, K40, K41, K42

Suggested Citation

Tzankova, I.N. and Kramer, Xandra E., From Injunction and Settlement to Action: Collective Redress and Funding in the Netherlands (December 27, 2020). in: Alan Uzelac & Stefaan Voet, Class Actions in Europe: Holy Grail or a Wrong Trail?, Springer 2020, Available at SSRN: https://ssrn.com/abstract=

I.N. Tzankova

Tilburg Law School ( email )

Tilburg, 5000 LE
Netherlands

Xandra E. Kramer (Contact Author)

Erasmus University Rotterdam (EUR) - Erasmus School of Law ( email )

3000 DR Rotterdam
Netherlands

Utrecht University - Faculty of Law ( email )

Janskerkhof 3
Utrecht, 3512 BK
Netherlands

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