Luxembourg has taken a major step in consumer protection as class actions are now possible under national law, but critics argue that the law does not go far enough.

The Chamber of Deputies unanimously adopted the bill on Thursday, which implements an EU directive into national legislation.

Under the new rules, only so-called "qualified entities" such as associations approved by the Directorate for Consumer Protection will be able to file complaints. Individuals will not have the right to initiate class actions, a measure intended to limit the volume of claims.

Christian Social People's Party (CSV) MP Stéphanie Weydert, rapporteur for the bill, described class actions as a way to counterbalance the uneven power between individual consumers and large multinational companies, using the biblical story of David and Goliath to illustrate consumers as the underdog David facing a powerful giant:

"The little shepherd, unarmed, confronts the giant with only his sling and a few stones. Goliath, mocking little David, of course, as he takes out his sling and fires a stone right into his forehead. The giant collapses: little David has won the fight."

The legislation has evolved significantly since its initial proposal in 2020 by then-Minister Paulette Lenert. Following extensive revisions and 110 formal objections from the Council of State, critics argue that the current text represents only a literal transposition of the EU directive.

Lenert, now a Luxembourg Socialist Workers’ Party (LSAP) MP, lamented that the government has decided to forgo additional provisions such as mandatory information meetings during mediation.

The Left (Déi Lénk) MP David Wagner agreed with Lenert, saying the new proposal grants fewer rights to consumers than the original proposal and called for class actions to be extended to labour law too:

"I can tell you that if little David's slingshot had looked anything like this bill, I don't know if it would have stopped Goliath from getting back up to beat little David up. It really isn't a perfect analogy."

Some MPs, including Alexandra Schoos of the Alternative Democratic Reform Party (ADR), remain concerned about the lack of clarity regarding which entities may file claims. While small businesses may lack resources to defend themselves, the situation differs for large corporations.

Once the law comes into effect, a dedicated website, recourscollectif.lu, will be launched to provide information and guidance to qualified entities and the public, according to Minister for Consumer Protection Martine Hansen.

While the topic of class actions has remained relatively calm in recent years, it was a heated issue a decade ago during the Volkswagen Diesel emissions scandal. In the United States, class actions were widespread, but in Luxembourg they were nonexistent and Germany saw nowhere near the volume seen in the US.