France, following the lead of many other European Union members,
has enacted legislation providing for class actions in the consumer
law field. The new law, known as the "Hamon Law", was
passed in February but is still coming into effect through various
decrees, which also provide further details on the mechanics of the
legislation. The law covers numerous consumer issues in addition to
providing for class actions.
The Hamon Law contains many features which make it distinct from
Canadian class action legislation.
First, individuals are unable to start class actions. The right
to bring a class action is only provided to nationally accredited
consumer protection associations (of which there are approximately
16). The scope is also limited to consumer class actions, which
includes actions with respect to the sale of goods, supply of
services, or anti-competitive practices. With respect to
anti-competitive practices, the law is even further limited in
scope; a class action can only be brought after a competition
authority has already found a competition law violation.
With respect to damages, consumers can only claim for
"material" damages, which are financial or economic
damages. Damages such as pain and suffering are not allowed.
The most unique feature of the Hamon Law is the fact that there
is no separate certification or screening decision. In Canada, a
class action must first be certified in order to proceed; a
certification decision considers whether the claim has the
requisite elements to proceed as a class action. In France, the
"first judgment", as it is called, will determine whether
the criteria for a class action is satisfied and rule on
the merits of the case, including liability, the definition of the
class, quantification of damages, the time period for opting into
the class, and how class members will be notified of the judgment.
Unlike class action legislation in Canada, the Hamon Law has an
"opt-in" only regime, which requires class members to
actively opt-in to the class action. However, since the opt-in
period is determined at the same time as liability and damages,
class members will know of the decision (including the damages they
would receive) before choosing to opt-in.
After the opt-in period has expired, the court can make a second
judgment in relation to any difficulties in implementing the first
judgment. The opt-in period must be no less than two months and no
more than six months.
There is also a simplified procedure available where the
identity and number of class members is known and the damages
suffered by each class member are the same. In this case, in the
first judgment, the court can order that the defendant directly
compensate the class members in accordance with the judgment.
Mediation is also available and any settlement agreement reached
is subject to approval by the court. As with any judgment, class
members must opt-in in order to be bound by the agreement.
Due to the limited scope and standing provided by the Hamon Law,
it is difficult to determine whether this law will result in a
large number of class actions. This would appear to be highly
dependent on the motivation of the approximately 16 accredited
consumer associations. However, it is expected that companies found
guilty of any competitive misconduct will almost assuredly face a
subsequent class action, which may likely change the willingness of
companies to cooperate with competition authorities and potentially
plead guilty to charges of anti-competitive behavior.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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