The European Union has taken a step toward giving consumers the right to file U.S.-style class-action suits.

Four years after the 'Dieselgate' scandal in which Volkswagen and other European carmakers installed software to hide vehicle tailpipe emissions and get around strict pollution laws, some EU member countries still do not offer consumers the right to launch class-action lawsuits.

Last week, the EU's Council, made up of ministers from the 28 national governments, agreed to start talks with lawmakers on legislation that would allow pan-European class actions.

But even with last week's decision, consumers may have to wait another three and a half years before they can exercise these rights.

The legislation, known as the Representative Actions Directive, would allow consumers in all or several of the EU's 28 member nations to launch common claims for compensation for faulty or illegal consumer goods.

At the moment, nine of the EU's 28 countries do not allow consumers to launch class actions, while in 11 countries the restrictive rules for class actions deter consumers from launching collective claims.

The proposed legislation is highly controversial. Business groups have expressed concern that the directive could lead to a spate of litigation and 'forum shopping', as groups and their lawyers bring cases in different EU countries to maximise their chances of winning their cases and getting compensation.

Andrew Austin, a London-based partner with Freshfields Bruckhaus Deringer in the firm's disputes, litigation and arbitration practice, wrote in a blog published last week that the EU's national ministers had improved the original draft legislation by addressing a number of problems. These included strengthening the criteria for "qualified entities" that are allowed to bring collective actions on behalf of consumers, he wrote in the blog.

Austin said the legal text still posed a number of areas for concern for businesses. These include the possibility for national governments to propose their own systems for collective redress, which he said would increase the chances of cases being launched under different legal regimes. He also highlighted a decision by the Council to extend the scope of the legislation to medical devices.

European consumer groups welcomed last week's progress. Monique Goyens, director general of the European Consumer Organisation, said in a statement that the Council's decision was "solid ground on which negotiations towards a final text can now begin".

In a statement, the association expressed concern that governments wanted to limit the possibilities for associations representing consumers to get financing for collective redress actions. "Litigation costs are one of the biggest impediments to launching a group action for non-profit organisations like consumer groups. Quite a number of consumer organisations in the EU would struggle to finance litigation costs by themselves," the statement said.

Goyens welcomed the decision to extend the legislation to cover medical devices.

Following last week's decision, the EU's national governments will begin talks with members of the European Parliament to reach an agreement on a final version of the text. This could be completed in the first half of 2020, although it might take until the second half of the year.

In either case, consumers would not be able to use the new law until three and a half years after it has been finalised because national governments want time to introduce the new provisions.