In November 2016 the Dutch Minister of Security and Justice submitted a legislative proposal on collective actions for claiming damages. The proposal aims to introduce the possibility for representative entities to claim monetary damages and at the same time to create a more efficient and effective way to file damage claims.

Under the current legal framework it is possible for claimants to be represented in court by a representative entity. However, it is not possible for the representative entity to claim monetary damages. It also happens that various representative entities litigate over the same subject-matter, in which case it is not always clear for claimants to determine which entity offers the best representation. For the defendant it can be unclear who to deal with for a final settlement.

Exclusive Advocate

The legislative proposal aims to lift the prohibition for representative entities to claim monetary damages, and offers the possibility for the court to appoint one entity as the so called Exclusive Advocate. This makes it possible to file a damage claim in a single procedure for all claimants. The representative entity needs to comply with certain requirements, for example with respect to governance and finance. Claimants who do not wish to be represented by the Exclusive Advocate are given the choice to opt out. A claimant who has chosen to opt out, is not bound by the decision of the court and can start an individual procedure to claim damages.

Possible impact

If the legislative proposal is adopted it may have a large impact on the practice of damage claim proceedings in the Netherlands. It could lower the threshold for parties to claim damages without compromising the legal position of the defendant, while easing the workload of the judiciary. In relation to infringements of competition law, it will be easier to redress the damages if there is a close connection with the Netherlands (e.g. sufficient claimants domiciled in the Netherlands or defendant located in the Netherlands). The legislative proposal is still pending before parliament and the debate in parliament is postponed until a new cabinet will have been installed.