Published by Global Banking & Finance Review®
Posted on August 1, 2025
2 min readLast updated: January 22, 2026
Add as preferred source on GoogleThe EU court ruled Volkswagen liable for defeat devices, affecting emissions standards. Compensation is capped, but must reflect damages.
BRUSSELS (Reuters) -The European Court of Justice on Friday ruled that carmakers like Volkswagen remain liable for using unlawful defeat devices, such as temperature-sensitive emissions software, even if the vehicles met EU standards, which doesn't guarantee the technology's legality.
The case at the European Union's top court arose from two German lawsuits involving Volkswagen diesel vehicles fitted with defeat devices, either during production or through later software updates. The Court said compensation to buyers can be reduced based on vehicle use or capped at 15% of the purchase price, but it must still adequately reflect the damage caused.
Volkswagen did not immediately reply to a request for comment. Any additional financial impact from the ruling was not immediately clear.
Defeat devices are tools or software that alter vehicle emissions, triggering legal disputes over whether manufacturers misuse them to conceal true pollution levels. Carmakers have argued these devices only activate at certain temperatures to protect the engine and comply with the law.
Volkswagen was found to have hidden excessive levels of toxic diesel emissions in 2015, a scandal that led to a management rout and thousands of regulatory probes and lawsuits which are taking years to settle.
(Reporting by Charlotte Van Campenhout; Editing by Kirsten Donovan)
A defeat device is a tool or software used in vehicles to alter emissions levels, often to meet regulatory standards while potentially concealing true pollution levels.
Compensation refers to the payment awarded to an individual or entity as a remedy for loss or damage, often determined by the extent of harm caused.
Compliance in finance refers to adhering to laws, regulations, and guidelines set by governing bodies to ensure ethical and legal standards are maintained.
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