1.3 Thesis and purpose

The purpose of this research is to extract the common elements from the different prospectus liability regimes under Dutch, French, German and English law in order to enhance the opportunity for investors domiciled in the European Union to privately enforce the EU prospectus rules on a collective basis. These prospectus rules seek to ensure that investors are able to make well-informed investment decisions. Private enforcement of these rules is realised by investors (associations) filing damage claims for losses sustained as a result of misleading information in the prospectus. Given the fact that a misleading prospectus will cause loss to a vast number of people, it is for reasons of efficiency and efficacy in the interest of claimants, defendants and the courts that the damage claims are dealt with in collective proceedings. In the case of an international dimension, it is in the defendant(s) as well as in the claimants interest that these cases are dealt with in cross-border, EU-wide collective proceedings. This can be realised either by collective action proceedings or collective settlement proceedings or a staged combination thereof: at first, a collective declaratory judgment on common legal questions/issues; secondly, a collective settlement. Even though the European Commission refers to a group action as an action of several claimants against the same defendant, I prefer to use the term collective action, because, in my opinion, the crucial feature is that the proceedings are dealt with at a collective level irrespective of the fact that one or more claimants are involved; one single representative may also proceed collectively.1

Given the fact that private law prospectus liability rules are not, and probably will not be, harmonised, the private international law problems arising in these cross-border, EU-wide procedures need to be dealt with. In Onding a solution to these problems, difficulties arising from a situation where the jurisdiction determining the prospectus contents and the jurisdiction determining the prospectus liability regime differ, will be taken into account.

For these reasons, this research attempts to answer the following question: are the private international law rules on applicable law and the rules on recognition of judgments that currently apply to prospectus liability claims suitable for proper-functioning of private enforcement of EU prospectus rules? Special attention is given to the complexities arising from proceedings in which investors collectively seek damages, or settlement of their claims, for the losses incurred as a result of a misleading prospectus. These complexities especially arise in opt-out collective proceedings, in which the interested parties are bound to the court's judgment unless they explicitly opt out.