Clifford Chance

Belgium transposes the Representative Actions Directive (RAD) – What impact on class actions? 

The transposition of the RAD into Belgian law occurred through the Law of 21 April 2024 amending the Belgian Code of Economic Law (CEL). Although the regime of class actions in Belgium is not radically changed, some modifications are worth highlighting.

Ten years after its implementation, the Belgian law regime of class actions undergoes its biggest transformation yet. Here are some of the most impactful modifications, which will be applicable to class actions initiated after 10 June 2024:

1. Opt-in option generalisation: it was previously the judge's duty to determine the possibility to participate in the result of the class action. In the new system, a distinction is made between court settlement of the dispute (litigation) and settlement by way of a collective redress agreement.

            -In case of litigation, if the court ruled against the defendant, the victims (consumers or SMEs that have suffered a loss) will automatically have the right to join the verdict during a period of four months to benefit from the compensation. Moreover, they will only be bound by a decision of liability. In other words, with this possibility, victims can wait until a favourable decision is reached on liability to decide whether they want to join the action, or they can continue their own individual action if the court rejects the collective claim.

            -In case of collective redress agreement, the parties have the freedom to establish an opt-in option and to determine its modalities (except in certain specific cases where the default opt-in option is mandatory).

2. Extension of the material scope of class actions: the scenarios in which a class action can be initiated have been broadened, and article XVII.37 CEL now expressly includes in the scope the instruments listed in Annex 1 of the RAD, such as the MiFID II Directive and the Prospectus Directive, including the abusive selling of financial products.

3. Definition of qualified entities: Qualified entities that are allowed to bring representative actions now benefit from a clear and precise definition, included in article XVII.1 CEL. This definition includes entities recognised in another Member State. Additionally, the text expressly addresses the question of ad hoc entities and allows them to start actions.

4. Quicker and more efficient admissibility phase: First, the default rule is now that the admissibility phase is held under summary proceedings at the introduction hearing or at an early date. Second, article XVII.43/1 provides that in case of appeal against the decision of admissibility, the action will be referred back to the initial judge if the admissibility is confirmed.

5. Longer statute of limitations: under the new regime, the statute of limitations of each individual claim is suspended during the entire procedure, thanks to article XVII.63 CEL.

While the transposition of the RAD is not a revolution of the Belgian class action regime, some modifications (such as the generalisation of the opt-in option, the possibility for EU qualified entities to act in Belgium, the summary treatment of the admissibility phase or the extension of the material scope) will have a significant impact as they will encourage the launch of new class actions by making the proceedings more efficient and easier to navigate for victims.