Decades of dithering over introducing a wide-ranging opt-out class action regime has harmed consumers and caused a loss of legal business to other jurisdictions, collective redress lawyers said today. Responding to the Law Commission's consultation on creating a consumer opt out regime, the Collective Redress Lawyers Association states that England and Wales has been considering whether to introduce an opt-out regime for 30 years: 'in failing to do so (bar for competition-based actions) it is falling behind competitors and peer nations – most of which have introduced or are in the process of introducing some form of opt-out or representative regime for consumers'.

Introducing an opt-out regime would provide a level playing field for compliant businesses, promote the British legal sector and improve British consumer protection and confidence, the association states. 

According to the response, 'the evidence shows that not having an opt-out regime can be bad for business as well as bad for consumers.' It notes: 'The UK’s legal regime is used by almost half of all international transactions, but consumer protection is in decline and we are lagging behind neighbouring jurisdictions despite having increased consumer protection legislation in recent years. We have already lost business to the Netherlands (the Uber driver case), and if Scotland introduces an opt-out regime more “forum shopping” will happen.'

The current regime, the response states, 'penalises British businesses which operate lawfully, affecting their ability to compete, and leading to consumer protection decline alongside high street decline'.  

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Industry funded lobby group Fair Civil Justice said it does not release responses to public consultation. A spokesperson said: 'Opt-out class actions are not the standard European model, and Britain should fix the problems in its existing regime before extending it. When lawyers and funders receive millions while consumers get very little, that is not access to justice.'

Ministers should judge these schemes by how much money reaches the people who were harmed, the spokesperson said. 'Consumers need quicker, cheaper ways to get their money back. Strengthening ombudsmen and effective redress schemes should come before opening the door to more expensive litigation.'

In its response to the consultation last month, the Law Society said: ’There is a public interest in holding businesses and other entities to account where individual consumer losses are too small to make litigation economically viable, but the aggregate impact of the underlying conduct is significant.’