Home > Legal articles > EU Parliament approves new collective redress mechanisms for consumers
On 24 November 2020, the European Parliament endorsed a new directive on representative actions for the protection of the collective interests of consumers (“Collective Redress Directive” or “CRD”). The CRD is part of the “New Deal for Consumers”, an initiative to strengthen EU consumer law enforcement and to modernise EU consumer protection rules.
The CRD introduces new cross-border and domestic redress mechanisms allowing collective actions against traders for violating a broad range of EU laws, such as data protection, travel and tourism, financial services, energy and telecommunications. The CRD will enter into force 20 days after its official publication. Member states will then have two years to implement the directive and a further six months to apply the new provisions. This means that these changes are expected to be in full effect in the EU from mid-2023 onward.
The CRD introduces the following key changes to existing consumer redress rules:
The CRD complements, but does not replace, existing EU and domestic collective redress mechanisms in specific areas, such as data protection. It remains to be seen how the EU member states will implement the CRD into national law, as they have wide discretion in deciding whether to incorporate the CRD into existing or new legislation.
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