Key features

Who can bring a collective action?

Initiating a collective action requires that multiple consumers encounter and report a common issue, such as a defective product or deceptive service. While there is no prescribed minimum number of participants, a larger group of affected individuals can enhance the credibility and impact of the case.

Legislation precisely determines which entities are authorized to initiate collective actions; private individuals are not permitted to file these claims independently. Authorized entities include:

• Consumer associations: Luxembourg legal entities with at least twelve months of demonstrable public activity in consumer protection, meeting rigorous standards of independence and transparency, and designated by the Minister for Consumer Protection (e.g., the Luxembourg Consumer Association).
• Sectoral regulatory bodies: Organizations such as the Commission de Surveillance du Secteur Financier, Commissariat aux assurances, Commission nationale pour la protection des données, Institut luxembourgeois de régulation, Autorité luxembourgeoise indépendante de l'audiovisuel, Institut luxembourgeois de la normalisation, Administration vétérinaire et alimentaire, Direction de l'aviation civile, Direction de la santé, and Autorité de la concurrence.
• Entities designated by other EU/EEA member states: Organizations listed with the European Commission may bring cross-border collective actions in Luxembourg.

Qualified entities may also represent Luxembourg consumers in similar proceedings abroad. Upon being engaged, the qualified entity commissions legal and technical specialists—at its own expense—to determine the appropriateness of pursuing a collective lawsuit.

Procedural framework

1. Steps to obtain a judgment on admissibility:
   1. Requirements for Application Admissibility

The qualified entity submits the collective action to the district court of Luxembourg City (commercial chamber), providing individual cases, a description of the consumer group involved, the requested measures, and a separate document that details sources of funding.

The court assesses whether each of the following admissibility criteria has been satisfied:

• Professional breach (potential or actual)
• Qualified entity initiates action
• Number of affected consumers
• No conflicts of interest, especially in third-party funding

2. Outcome

If the district court finds the claim plausible, it admits the case and issues a public notice. Other consumers may join for free if they provide evidence like receipts or contracts.

The judgment may be appealed to the court of appeal. If the motion is dismissed, a new action can be filed again. Dismissal of the motion suspends the limitation period for similar actions.

2. If allowed, the collective action may seek:
   1. Cessation or Prohibition of the Breach

A claimant may request a court order to stop or prohibit unlawful professional practices. If a breach is found, the court can specify corrective measures and deadlines without requiring proof of loss or intent; the existence of the breach is sufficient. Judgments can be appealed within 15 days and are published online by the relevant consumer protection ministry once final. If both cessation and compensation are sought, the court addresses cessation first, then liability and damages.

2. Compensation (professional's responsibility)

The court reviews each case and evidence. If responsibility is found:

• It defines the affected consumer group and sets membership criteria and possible categories.
• Damage types, amounts, and compensation deadlines are specified. The court may require in-kind performance (e.g., repair, replacement, contract resolution) instead of monetary payment.
• The membership system (opt-in/opt-out) is set with a two-to-six-month window.
• A liquidator manages claims, compensations, and reporting.
• Judgments are published online, and consumers are notified.

3. Mediation option

Mediation is available at any stage of the collective action process and can be initiated by the parties or suggested by the court. It follows specific rules for collective disputes. Any agreement reached must be approved by the court to become binding and enforceable, then published online so consumers can join or opt out within a set period. Mediation aims to resolve disputes amicably, lower costs, and offer flexible solutions for consumers. If mediation fails, the case returns to court.

4. Implementation of the liability judgment

After a liability judgment, the court appoints a liquidator to:

• Collect and verify consumer claims,
• Manage compensation or in-kind performance as ordered,
• Provide regular progress updates to the court.

The professional must compensate or provide ordered relief to eligible consumers within the deadline set. The liquidator submits interim and final reports detailing execution and issues. Once all consumers are compensated or reasonable efforts have been made, the court closes the case. Uncompensated consumers may seek direct enforcement.

Protection and openness

All major decisions are published on the ministry's website. Third-party funding is tightly regulated to avoid conflicts of interest. Appeals are possible at every key stage.

What's next

The council of state lifted its reservation on the constitutional second vote after amendments improved legal coherence and safeguards. Once exempted from a second vote, the law should take effect four days after publication in the Luxembourg Mémorial. It applies retroactively to collective actions since 25 June 2023. Within five years, the government must evaluate the regime's effectiveness, results, and need for legislative change.

Business and consumer impact

Collective redress now poses a tangible risk for businesses, so they should check compliance and be ready for potential actions. Consumers gain a clear, accessible process for redress with robust safeguards and court oversight.