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CONSUMERS

France mulls US-style ‘class action’ law suits

The French government is set to consider American-style "class action" lawsuits at a cabinet meeting on Thursday. The reform is designed to give consumers “effective weapons against fraudulent companies,” and would be a first for France.

France mulls US-style 'class action' law suits
File photo: OliBac/Flickr

France's Minister of Consumer Affairs Benoit Hamon looks set  to propose the introduction of US-style class action lawsuits at the government’s cabinet meeting on Thursday.

Hamon labelled the legal instrument a “weapon of mass deterrence” against fraud, price-fixing and other consumer violations, in an interview with French daily L’Express.

“For 20 years, employers’ organizations have been blocking this democratic progress, and for 20 years the French consumer has been under-protected,” Hamon told L’Express when announcing the proposal in April.

During their tenures, former Presidents Jacques Chirac and Nicolas Sarkozy both unsuccessfully attempted to establish class action lawsuits, which allow groups of individuals to collectively sue a defendant or group of defendants, without separately having to file a case and hire a lawyer.

The minister’s planned legislation will offer a more limited version of class action litigation than is found in the United States, for example.

Firstly, under the proposals collective lawsuits will have to be brought through one of France’s 16 officially recognized consumer associations, and secondly, compensation would only be able to be sought for material damages arising from a company’s legal or contractual violation.

Furthermore, whereas in the United States, class action suits are often pursued over public health scandals, under Hamon’s plan collective litigation would be limited to grievances over competition and consumer breaches.

However, there would be no minimum number of plaintiffs required to bring a case, and perhaps most significantly, no upper limit to financial damages.

Employers’ groups, led by the national Medef union, have reacted critically to the plan, in particular the increase in possible damages for cases of consumer violations.

Hamon, however, offered a staunch defense of the proposal. “Is it really shocking to increase sanctions for companies who lie, cheat and can bring down entire industries with them? I don’t think so.”

For its part, France’s biggest consumer group, UFC Que Choisir, has cast doubt on the potential effectiveness of Hamon's plan.

“The process [of claiming damages] can take a very long time. Consumers who are notified 15 years later won’t have the evidence or their receipts anymore,” Alain Bazot from UFC Que Choisir told Europe 1 radio.

“We have to set clear deadlines, so that justice can be delivered swiftly,” he added.

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ECONOMY

Why now is a good time to buy a car in Switzerland

Switzerland's automobile sector has been stagnating during the Covid-19 crisis and now it appears is the right time to pick up a bargain.

Why now is a good time to buy a car in Switzerland
Many cars in Switzerland remain unsold. Photo by INA FASSBENDER / AFP

The law of economics dictates that when the supply of goods is high and the demand is low, the prices will drop. This is currently the case with cars in Switzerland.

In times of crisis, as evidenced by the Covid-19 pandemic, people are uncertain about the future and reluctant to spend their money on luxury items like new automobiles.

In fact, “the coronavirus has caused consumer sentiment in Switzerland to hit a historic low”, according to a report by the state Secretariat for Economic Affairs (SECO). 

READ MORE: UPDATE: Coronavirus-hit Swiss economy shrinks 2.6 percent in first quarter 

The Swiss automobile market has also been impacted by this downward trend, resulting in substantial decrease in sales.

According to Swiss association of car importers, Auto Suisse, “economic uncertainties translate into weak demand”. 

“In the past month only 13,890 new passenger cars have been registered in Switzerland, which is 50.5 percent less than a year ago”, the association added.

So if you are planning to purchase a new car, now is the time to do it.

“After the period of confinement, stocks are saturated”, Dino Graf, communications manager of the Amag group, Swiss importers of VW, Audi, Skoda, Seat, and Porsche, told Le Matin newspaper.

“As our manufacturers have reduced their production in recent months, and the new vehicles have not yet arrived in Switzerland, the warehouses are full”, he added.

For instance, Le Matin calculated that by using the discount offered by car dealers on the vehicles they have in stock — the so-called ‘stock premium’— a customer could save 6,000 francs on a new Peugeot 308.

And leasing is available at 0 percent for certain automobiles— making the purchase of a new car even less costly. 

However, Le Matin predicted that the discounts will likely not last long and “prices will go up at the end of the year”, as the economy slowly recovers.

All the information about costs associated with car ownership in Switzerland can be found here

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