UK Consumer Class Actions - Proposed New Regime

The UK Government has asked the Law Commission – the independent organisation that reviews and recommends reforms to the country’s laws – to consider whether England and Wales should introduce a dedicated consumer class actions regime. If implemented, this could represent a seismic change in the UK, greatly expanding collective redress for consumers beyond the existing traditional collective proceedings regime for competition claims in the Competition Appeal Tribunal (CAT).

This alert sets out the proposal, its implications for claimant strategy and corporate exposure, and how stakeholders can engage before a final model is selected.

The Law Commission’s Proposal

The proposal’s stated objectives are to improve access to redress for consumers, ensure that damages are effectively distributed to affected consumers, and to promote efficient litigation at proportionate cost. At this stage, the Commission has not defined what will qualify as a “consumer-law claim”, with the scope of eligible claims an open question for consultation. The most likely starting point would seem to be the existing statutory consumer law rights and remedies, but it is possible that the scope could extend to mass-harm claims beyond any existing statutory framework.

In looking at whether to introduce such a regime, the Commission will consider (among other issues):

1. how “consumer‑law claim” should be defined;
2. whether claims should proceed on an opt‑in and/or opt‑out basis;
3. the criteria and process for commencing proceedings (including class definition and certification);
4. management of class action proceedings; and
5. the approach to damages, costs, settlement and funding (including any changes following the Civil Justice Council’s litigation funding review).

The Commission will also take account of the Government’s CAT opt‑out regime, including issues around financing, sectoral targeting by litigants, distribution effectiveness, pent‑up demand for opt-out claims, the role of class certification, and the vulnerability of the proposed regime to exploitation.

Current “Opt-in” Regimes

Outside the competition arena, there are currently two main mechanisms available for the bringing of group litigation, although neither provides for true collective “class action”:

1. Civil Procedure Rules Part 19 – Representative actions under CPR Rule 19.8 allow a claimant to sue (or be sued) on behalf of others sharing the “same interest”. There is no built‑in certification stage or detailed machinery for funding or distributing damages across a wider group and “the same interest” has been interpreted relatively narrowly by the courts.
2. Group Litigation Orders – A case management framework for bringing multiple individual claims on a group register aimed at efficient case handling. Each claimant must issue their own claim or opt-in to be joined to one.

Potential New Opt-out Regime

A new opt‑out route could materially increase exposure for defendants in consumer-facing markets. Through class certification, the court would test who is in the class, whether the claims raise common issues suitable for collective determination, and whether class‑wide distribution is practicable. Certification and formal class definition would make it more economically attractive to aggregate numerous low-value claims, which may well create interest among litigation funders. The Commission’s emphasis on ensuring distribution to the affected class means that identification, notice and the amount of the ultimate payout available to each individual claimant are likely to be at the forefront of the Commission’s consideration. The Commission has also been asked to assess how different funding models would affect damages returned to consumers, costs, settlement dynamics and distribution mechanics in any opt‑out system.

The Commission is also likely to be concerned to ensure that any new class action regime meshes with existing public enforcement and alternative dispute resolution (ADR) frameworks, including the Competition and Markets Authority’s (CMA) enhanced administrative redress powers under the Digital Markets, Competition and Consumers Act 2024. Effective coordination between the CMA, other sectoral regulators and other public enforcers, approved ADR bodies, and the civil courts, is essential to avoid duplication.

Respond to the Scoping Questionnaire

The Commission’s Initial Scoping Questionnaire is open until 30 October 2026, after which the Commission will meet stakeholders and publish a consultation paper based on the evidence and views it has gathered.

The Questionnaire, together with further information on the proposal, can be found on the Commission’s project page. Responses should be sent to consumerclassactions@lawcommission.gov.uk.