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On 1 January 2020, the Dutch Act on the Resolution of Mass Claims in Collective Action (Wet afwikkeling massaschade in collectieve actie) (Dutch acronym: WAMCA) will enter into effect, introducing the possibility of claiming damages on a collective basis under an opt-out regime for Dutch residents and an opt-in regime for parties residing abroad.

Current regime vs. WAMCA

Under the current regime, claims on behalf of a number of claimants (the “class”) can be started in one action by claim organizations such as associations (verenigingen) or foundations (stichtingen) that have full legal capacity and are incorporated for the purpose of representing common interest issues (e.g., consumer rights, investor claims). As a result of these class actions, claimants can collectively seek declaratory decisions (verklaring voor recht) from the court regarding liability. It is not possible to claim monetary damages in a class action under the current regime. Claimants must start separate proceedings following the collective proceedings to claim monetary damages.

Under the WAMCA, claimants can file for monetary damages within Dutch class action procedures that relate to events on or after 15 November 2016. A judgment in a class action is binding for all Netherlands’ residents who fall within the group for which the claim organization is taking legal action. The pre-WAMCA regime will still apply to actions relating to events that took place before 15 November 2016.

Admissibility requirements

Class action proceedings for monetary damages are subject to certain admissibility requirements. One such requirement is that the claim must be sufficiently connected with the jurisdiction of the Dutch courts, which means that:

  • the majority of the claimants reside in the Netherlands;
  • the defendant resides in the Netherlands; or
  • the event(s) on which the class action is based took place in the Netherlands.

Before a substantive hearing of the class action can take place, the claim organization must demonstrate that the class action is more efficient and effective than bringing an individual claim. Claim organizations that represent the interests of the claimants must also meet additional requirements in the field of representativeness, governance, and financing. For example, a claim organization is only authorized to commence a class action if it has full legal capacity for the protection of similar interests of the claimants it represents pursuant to its articles of association, has a supervisory board, and operates as a non-profit. Furthermore, claim organizations must have sufficient funding to bear the costs of the action.

WAMCA procedure in a nutshell

If all admissibility requirements are met, the claim organization may file its claim and must publish the claim in the newly introduced class actions register (centraal register voor collectieve vorderingen). If several claim organizations want to file a collective claim in respect of the same event that caused damage to the class, the court will appoint the most suitable representative as the exclusive representative of the class (“lead plaintiff”). After appointment of the lead plaintiff, parties will be provided the opportunity to reach a class settlement. If parties reach a settlement, they will present the settlement agreement to the court for its approval.

Members of the class have, in principle, the opportunity to opt out within one month after publication in the class actions register and appointment of the lead plaintiff or a collective settlement agreement has been concluded. Plaintiffs not residing in the Netherlands have, in principle, the opportunity to opt in; they will then become members of the class. Members of the class who did not timely opt out are bound by any outcome regarding the class action.

Final remarks

Under the WAMCA, one regime will cover class actions in the Netherlands, irrespective of whether or not the claim relates to monetary damages. This could result in an increase of monetary claims from claim organizations, for example in relation to consumer claim organizations bringing class actions for environmental matters, such as the recent Urgenda ruling (See December 2019 Amsterdam Law blog post) or investor claim organizations bringing collective actions for prospectus liability.

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