European class actions have seen a significant growth, according to the latest edition of the annual European Class Action Report by law firm CMS. The 133 international claims filed in 2023 represent a 10% increase from 2022 and a staggering 93% increase since 2019. The implementation of the Representative Action Directive (RAD) in 2023 has been a pivotal development. The Netherlands accounted for 18% of all claims last year, making it one of Europe's hot spots.
Leonard Böhmer, Partner at CMS in the Netherlands, says: "Class actions are increasing internationally in Europe due to improved (EU) legislation and infrastructure. The Netherlands is one of the frontrunners in this with the Mass Damage in Collective Action Act (WAMCA), although last year we saw a more critical attitude among courts regarding admissibility of commercial claim foundations."
Bart-Adriaan de Ruijter, Partner at CMS in the Netherlands, adds: "In contrast, regarding idealistic more ESG-related mass claims, we see a more flexible attitude in Dutch courts regarding admissibility. ESG claims will receive a further uplift through ESG legislation such as CSRD and CSDD."
Key insights from the report:
- Opt-out claims growing: Opt-out claims represented 54% of all claims in Europe in 2023, while the total claimed value of opt-out claims in the UK, the Netherlands and Portugal has increased seven-fold between 2020 and 2023.
- Diverse trends in types of claims: While product liability, consumer law and personal injury took the lion’s share (32%) of claims across Europe.
- Claims by sector: 2023 saw the largest number of claims yet against tech companies, as well as (mostly Dutch) claims against governments and governmental bodies. While the number of claims in the financial products and professional services sectors has fallen compared to 2022, it was still the second-highest ever. This demonstrates a consistent growth trend in group litigation across all significant.
- Emerging class action risks: NGOs increasingly operate on a more international scale, leading to corporations encountering NGOs on an increasingly frequent basis. This, as well as changes set out in the new Product Liability Directive, are emerging as new risks that could increase litigation and class action claims. The strong availability of litigation funding across key hotspots in Europe is also having a profound impact.
