Since 1 January 2020 a representative organisation can claim damages in money on behalf of a large group of injured parties in the Netherlands. That is the change brought by the Act on the Resolution of Mass Damages in a Collective Action, the WAMCA. Before it, a collective action could obtain a declaration that conduct was unlawful, but each injured party then had to bring an individual claim, or the parties had to reach a settlement for it to be declared binding.
Mass damage is damage suffered by a large group of victims from the same cause: a defective product, a data breach, misleading financial information, an environmental incident, a cartel. What these situations have in common is that the loss per person is often modest while the total is very large, which is precisely the situation in which individual litigation does not happen.
Who may bring a collective action?
Only a foundation or association that represents the interests concerned under its articles, and that satisfies strict admissibility requirements. It must be sufficiently representative of the group, have adequate governance and supervision, be transparent about its funding, and have made a genuine attempt to resolve the matter with the defendant before starting proceedings. The claim is registered in a central register, and other organisations are given the opportunity to bring competing actions for the same event.
Where several organisations come forward, the court appoints one of them as exclusive representative to conduct the action for the whole group. That mechanism was introduced to prevent parallel proceedings about the same facts.
Who is bound by the outcome?
Injured parties resident in the Netherlands fall within the class automatically and are bound unless they opt out within a period set by the court. Injured parties resident abroad generally have to opt in. The result is that a company facing a WAMCA action is confronted with the whole Dutch class at once rather than with individual claimants.
Where the parties reach a collective settlement, the court can approve it and declare it binding on the class, again subject to a right to opt out.
What this means in practice
For claimants, the WAMCA has made it realistic to pursue losses that would never justify an individual case. For companies, it has made the Netherlands one of the more active jurisdictions in Europe for collective redress, and it has changed how mass incidents are assessed: the exposure from a single event is now aggregated from the outset.
Our detailed guide to class actions in the Netherlands sets out the procedure, the admissibility requirements and the case law in full.
Advice on collective actions
Whether you are considering joining a collective action or your company has been served with one, the early decisions matter most: whether to opt out, whether to challenge admissibility, and how to handle the phase before proceedings begin. Please contact Law & More; our litigation lawyers advise on both sides of these claims.
