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The Law Commission of England and Wales has announced a significant new project examining whether England and Wales should introduce a new consumer class actions regime<\/a>.<\/p>\n The project, announced on 20 April, follows the government requesting the Law Commission to assess whether the way consumer laws are enforced in England and Wales could be strengthened through the introduction of a consumer class actions regime.<\/p>\n The UK Competition Appeal Tribunal (CAT) regime allows true \u2018opt-out\u2019 claims \u2013 in other words where a representative claimant pursues a claim on behalf of a class of others who do not need to take any positive steps to join the claim \u2013 but this procedural regime is only currently available in cases involving competition law breaches.<\/p>\n For other types of claims, currently the representative action procedure in the Civil Procedure Rules (CPR) r.19.8 allows a single claimant to bring proceedings as representative of others who have the \u201csame interest\u201d in the claim, without those others being party to the proceedings. However, this \u201csame interest\u201d requirement<\/a> has made it difficult for some claimants to bring a representative action in practice.<\/p>\n The Law Commission\u2019s project, which is expected to commence in Autumn 2026, will identify the benefits and risks associated with introducing a more general consumer class actions regime. It will also make recommendations on how such a regime could be designed both to improve consumers\u2019 access to redress and recovery of potential damages, while promoting \u201cthe efficient conduct of litigation at proportionate cost\u201d. <\/p>\n Due to the automatic inclusion of large numbers of class members, opt-out claims can lead to significantly higher aggregate damages and costs for defendant businesses. Ahead of the project\u2019s implementation, the Law Commission has published terms of reference<\/a> and is inviting businesses to respond to an initial scoping questionnaire.<\/p>\n Commenting on the new project, Emily Cox<\/a>, a class action litigation specialist at Pinsent Masons, said:\u00a0<\/p>\n \u201cThis is the clearest sign yet that the government is at least philosophically drawn to expand the opt-out regime beyond competition law. Given some of the significant cost-benefit questions posed by the CAT regime, this project is a real opportunity for businesses to make a considered case regarding structural and design issues, and how consumers and businesses might best be served, for example with alternative dispute resolution.\u201d<\/p>\n Previous proposals to introduce a more general consumer class actions regime similar to the CAT regime have not progressed in England and Wales, although Scotland is currently considering introducing a general opt-out group proceedings regime<\/a>.<\/p>\n Last year the Department for Business and Trade ran a call for evidence regarding the efficacy of the class actions regime already in place in the CAT \u2013 the outcome of which is still awaited.\u00a0<\/p>\n The Law Commission also says it will consider the funding of claims, taking into account any reforms to third-party litigation funding (TPLF) that might be introduced as a result of the Civil Justice Council\u2019s (CJC\u2019s) recent review of such funding<\/a>.<\/p>\n TPLF is a critical factor in bringing most class actions but has received criticism that it is inadequately regulated and can drive up the costs of actions without appropriate concomitant benefit to consumers.<\/p>\n The CJC published a final report<\/a> (150-page \/ 1MB PDF) following its review of litigation funding last summer. The government has indicated that it will adopt at least some of the CJC\u2019s proposals<\/a>, meaning that some additional regulation of the TPLF industry may be introduced in the foreseeable future.<\/p>\n Encouragingly for businesses, the terms of reference for this latest project suggest that the Law Commission is expected to take a balanced, holistic approach to introducing a new consumer class actions regime. In particular, the project will consider the relative effectiveness of distribution of damages as well as whether certain sectors are disproportionately targeted by litigants, and the relative vulnerability of opt-out collective proceedings being exploited and creating a \u2018litigation culture\u2019.<\/p>\n Angelique Bret<\/a>, a competition and consumer law expert at Pinsent Masons, said the introduction of a collective actions regime for consumer law breaches has been anticipated since the enhanced civil enforcement regime for consumer law breaches was introduced by the Digital Markets, Competition and Consumers Act 2024 (DMCCA).<\/p>\n The DMCCA, which came into effect in April 2025, empowered the Competition and Markets Authority (CMA), the UK\u2019s consumer and competition law watchdog, to decide whether a company has breached consumer law, without having to go to court, along with the ability to impose fines and make directions for consumers to be compensated.<\/p>\n