Consumer bill raises fears of class action law

BRITISH business groups have today pledged to fight against part of the government’s proposed consumer rights bill, which they believe opens the door to US-style class action lawsuits.

The CBI said the draft bill, unveiled by business minister Jo Swinson this morning, risks “fuelling a litigation culture” by allowing members of the public, businesses, or consumer associations to bring collective legal actions on an opt-out basis.

Although initially limited to cases involving alleged breaches of competition law, the CBI warns it could make the UK “a worse place to do business”.

The British Chambers of Commerce echoed their concerns, saying it “could establish a dangerous and unwelcome precedent”. Lawyers have previously warned such a reform could attract competition lawsuits from across Europe to UK tribunals.

The bill also hands consumers the right to receive money back if replacement goods fail a second time, demand substandard building work is redone, and extends more protection to digital purchases.

It also introduces a set 30-day period when consumers can return faulty goods and obtain a full refund.