French National Assembly Gives Class Actions a New Impetus
The French National Assembly has passed a bill intended to promote the use of class actions in line with the new EU Representative Actions Directive.
On March 8, 2023, the French National Assembly breathed new life into class actions by passing a bill that harmonizes procedural aspects, encourages the initiation of proceedings, and serves as a transposition of the EU Representative Actions Directive. The bill is currently awaiting approval by the French Senate. Once passed into law, the bill will likely increase the number of class actions pursued in France.
The bill seeks to harmonize the procedural aspects of class actions. Class actions have been introduced in a piecemeal fashion in France since 2014. They were originally limited to consumer protection prior to being extended in 2016 and 2018 to cover health products, environmental issues, personal data protection, anti-discrimination, and property rentals. The new bill eliminates existing disparities between these preexisting sectoral class actions by providing a common procedural ground.
The bill also encourages the initiation of proceedings by extending legal standing and rebalancing incentives. It extends legal standing to initiate class actions to include a wider range of registered and ad hoc associations (which are made up of at least 50 physical persons or at least five companies or five local authorities) as well as the public prosecutor. This will greatly expand the relatively small pool of approved associations under the previous consumer protection class action regime. The bill further encourages actions by creating a 3% annual turnover civil penalty where there is deliberate misconduct by the offending party and by requiring the State to bear the costs of the proceedings when the action is of a serious nature.
Finally, the bill ensures the transposition of the EU Representative Actions Directive into French law also by extending legal standing to certain entities authorized in other Member States, authorizing French entities to bring cross-border actions, and addressing conflicts of interests.