Class Action - Netherlands

Netherlands

Dutch law allows associations (verenigingen) and foundations (stichtingen) to bring a so-called collective action on behalf of other persons, provided they can represent the interests of such persons according to their by-laws (statuten) (section 3:305a Dutch Civil Code). All types of actions are permitted, excluding a claim for monetary damages. Most class actions over the past decade have been in the field of securities fraud and financial services. The acting association or foundation may come to a collective settlement with the defendant. The settlement may also include – and usually primarily consists of – monetary compensation of damages. Such settlement can be declared binding for all injured parties by the Amsterdam Court of Appeal (section 7:907 Dutch Civil Code). The injured parties have an opt-out right during the opt-out period set by the Court, usuallay 3 to 6 months. Interestingly, settlements involving injured parties from outside The Netherlands can also be declared binding by the Court. Notably since US courts are reluctant to take up class actions brought on behalf of injured parties not residing in the US who have suffered damages due to acts or omissions committed outside the US, it may be interesting to combine a US class action and a Dutch collective action to be able come to a settlement that covers plaintiffs worldwide. An example of this is the Royal Dutch Shell Oil Reserves Settlement that was declared binding upon both US and non-US plaintiffs.