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German Government approves new collective redress to protect consumers, creating new exposures for companies and insurers

As expected following discussions and various proposals over the last two years, as one of its first actions, the new German Government has approved a new Model Declaratory Action to protect consumers and specifically to give Volkswagen car owners a collective option before expiry of the statute of limitations. 

This decision just comes shortly after the EU Commission’s New Deal for Consumers including a similar proposal on the European level. 

Many questions are, however, still open as regards both proposals, and experiences are mixed at best with the collective action by shareholders- the KapMuG proceedings which Germany also adopted in view of a specific case, Deutsche Telekom in 2005.

 In any event, it is clear that the European litigation landscape is dramatically changing even though all proposals in the table distinctively draw a line to anything coming too close of US style class actions.

Germany has approved draft legislation to allow US-style class action lawsuits in the country that should give consumers the power to seek compensation following Volkswagen’s diesel emission scandal.

Tags

insurance claims, class actions, litigation, european union, germany, volkswagen