test (1)

Class actions have a long tradition in the United States (US). Contrastingly, most European jurisdictions used to vigorously reject the adoption of "US-style" class action instruments. This is about to change in the field of consumer laws. The U-turn came in 2020, when the EU adopted a directive on representative actions for the protection of collective interests of consumers (the "Directive"). The Directive seeks to ensure that an EU-wide "effective and efficient procedural mechanism for representative [i.e., collective] actions for injunctive measures and for redress measures is available to consumers […]".

To achieve that goal, the Directive gives "Qualified Entities" ("QEs") (e.g., a non-profit organisation protecting the interests of consumers) the right to request "injunctive" and/or "redress" measures for breaches of consumer laws. Injunctive measures include provisional and final orders to cease a breach of consumer laws and may be granted without any actual loss being sustained by consumers. Redress measures encompass a variety of remedies such as compensation, price reduction or contract termination. QEs may issue local and cross-border representative actions in other Member States. QEs from different Member States may also join forces and sue a defendant in one specific domestic court.

The new collective action regime shall apply to claims based on breaches of consumer laws that occurred on or after 25 June 2023. EU Member States are in the process of transposing the Directive into national law. In many CEE jurisdictions, the possibility to request compensation in a collective action will be new and materially change the litigation landscape. For companies engaged in B2C business, the new collective action regime will increase the prospects of high value claims filed by consumers. This will require firm litigation management to fend off and mitigate the risks flowing from the new collective action regime. A prudent litigation management starts with monitoring laws. The map below provides an overview as to how CEE States intend to implement the Directive. This is a key aspect of monitoring because EU States enjoy a considerable margin of discretion in implementing the Directive.

Class action legislation in CEE.

entry into force expected

draft

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Bulgaria
Information as of 9 May 2023;
status of legislation: draft.

1.) Standing
Representative non-profit entities may issue collective
proceedings, provided that they are included in the list
approved by the Minister of Economy and Industry. Collective
proceedings may also be brought by the Commission for
Consumer Protection.

2.) Opt-in/opt out
A combination of both mechanisms exists. The court will set
a time limit within which affected consumers may join the
representative action. A consumer who has requested to
participate in the representative action for compensation may
opt-out in any state of the case.

3.) Eligibility
No details are provided regarding the degree of similarity
or the minimum number of consumers.

4.) Quantum
The courts are entitled to estimate losses.

5.) Third party funding
Third-party litigation funding is permitted.

6.) Allocation of costs/success fee
The "loser pays" principle applies. In exceptional
circumstances, the court may order an individual consumer,
belonging to the group of consumers, to pay the costs of the
representative action for damages proceedings that were
incurred as a result of the individual consumer’s intentional
or negligent conduct.

7.) State cash in mechanism
No state cash in mechanism applies.

Class action legislation in CEE.

Czech Republic
Information as of 20 April 2023;
status of legislation: draft.

1.) Standing
Non-profit legal entities may issue collective proceedings.

2.) Opt-in/opt out
The opt-in mechanism applies.

3.) Eligibility
The class filling a collective claim shall have at least 20
members and the claim shall be based on a similar factual and
legal basis (commonality). The suitability of the claim will be
assessed by the courts on a case-by-case basis, considering
the procedural economy, number of class members and nature
of the claim, (i.e. whether the claims are suitable for awarding
aggregate damages).

4.) Quantum
The courts are entitled to estimate losses.

5.) Third party funding
Third-party litigation funding is permitted.

6.) Allocation of costs/success fee
The "loser pays" principle applies.

7.) State cash in mechanism
No state cash in mechanism applies.

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Class action legislation in CEE.

Croatia
Information as of 9 May 2023;
status of legislation: draft.

1.) Standing
Non-governmental organizations or other non-profit
association have legal standing.

2.) Opt-in/opt out
The opt-in mechanism is mandatory for redress measures.

3.) Eligibility
The draft legislation does not provide any details in this regard.

4.) Quantum
The courts are entitled to estimate losses.

5.) Third party funding
Third-party litigation funding is permitted.

6.) Allocation of costs/success fee
The "loser pays" principle applies, subject to a maximum
recoverable amount.

7.) State cash in mechanism
No state cash in mechanism applies.

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Class action legislation in CEE.

Hungary
Information as of 8 May 2023;
status of legislation: entry into force expected
on 25 June 2023.

1.) Standing
Three types of entities have legal standing:
(i) qualified entities designated by the minister
in charge of consumer protection,
(ii) qualified entities designated by the national law and
(iii) qualified entities designated in another Member State.

2.) Opt-in/opt out
Both mechanisms exist, the rule being the opt-out mechanism.
The opt-in mechanism applies to all persons without habitual
residence in Hungary at the time of the court's decision to
approve a collective action.

3.) Eligibility
The claimant must show that the claim concerns the same
legal issuesand is filed on behalf of an identifiable group.

4.) Quantum
The courts are entitled to estimate losses.

5.) Third party funding
Third party funding is permitted.

6.) Allocation of costs
The "loser pays" principle applies.

7.) State cash in mechanism
No state cash in mechanism applies.

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Class action legislation in CEE.

Poland
Information as of 9 May 2023;
status of legislation: draft.

1.) Standing
Now, a class action may be brought by a class representative
who is either (i) one of the class members, (ii) a municipal/
district Consumers Ombudsman (in matters related to
consumer protection) or (iii) the Financial Ombudsman
(in matters related to financial market services), but under the
draft legislation, in matters related to infringement of
consumer interests, a class representative may also be a
consumer organization entered into the relevant register.

2.) Opt-in/opt out
The opt-in mechanism applies.

3.) Eligibility
The claims must be of one type and based on the same
or identical factual basis.

4.) Quantum
The courts are entitled to estimate losses.

5.) Third party funding
Third-party litigation funding is permitted.

6.) Allocation of costs
The "loser pays" principle applies, with the exception of
proceedings initiated by the Financial Ombudsman (or, under
the draft legislation, a registered consumer organization),
where class members do not bear any costs.

7.) State cash in mechanism
No state cash in mechanism applies.

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Class action legislation in CEE.

Romania
Information as of 7 May 2023;
status of legislation: draft.

1.) Standing
Qualified entities (consumer associations, consumer
associations representing members from at least two Member
States, ad hoc entities, public authorities and bodies
responsible for implementing the law) have legal standing.

2.) Opt-in/opt out
The opt-in mechanism is mandatory for redress actions.
No opt-in is required for injunctive actions.

3.) Eligibility
The draft legislation does not provide any details in this regard.

4.) Quantum
The courts are entitled to estimate losses.

5.) Third party funding
Third-party litigation funding is permitted.

6.) Allocation of costs/success fee
The "loser pays" principle applies. The general rule is that the
qualified entities bear the court fees. However, the individual
consumers may be ordered to pay the costs of proceedings on
the condition that these were incurred as a result of the
individual consumer's intentional or negligent conduct.

7.) State cash in mechanism
No state cash in mechanism applies.

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Class action legislation in CEE.

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Slovenia
Information as of 9 May 2023;
status of legislation: draft

1.) Standing
Representative non-profit entities may initiate collective
proceedings, provided that there is a link between the entity's
statutory objectives and the consumer rights at issue. They
must fulfil additional criteria. Collective proceedings may
also be brought by the higher state attorney
(višji državni odvetnik).

2.) Opt-in/opt out
Both mechanisms exist. The claimant may propose the
preferred mechanism, however, it is ultimately up to the court
to decide which mechanism would be more suitable
in the particular case.
The opt-in mechanism applies mandatorily if
(i) at least one of the claims in the collective action
relates to the payment of compensation for
non-pecuniary damages; or
(ii) at least 10% of the members of the class are
seeking paymentin excess of EUR 2,000.

3.) Eligibility
Various conditions apply, inter alia that the claimant must
show that claims at issue concern the same, similar or
connected factual or legal issues (commonality) and
that a claim must be suitable for collective
determination (suitability).

4.) Quantum
The primary method for determining
compensation is individualization of damages.

5.) Third party funding
Third-party litigation funding is permitted.
Various conditions/safeguards apply.

6.) Allocation of costs
The "loser pays" principle applies.

7.) State cash in mechanism
No state cash in mechanism applies.

Class action legislation in CEE.

Slovakia
Information as of 9 May 2023;
status of legislation: draft.

1.) Standing
Non-profit entities enrolled with the Ministry of Economy
as Qualified Entities may issue collective proceedings,
provided that they have been active in the field of consumer
protection and have not been removed from the list for
12 months.

2.) Opt-in/opt out
Both mechanisms exist. The opt-in regime is given priority; a
consumer may withdraw its prior opt-in consent at any time
after the filing of the claim (at the latest by the end of the
evidence before the court of first instance).

3.) Eligibility
At least 20 consumers must participate to initiate
injunctive relief proceedings.

4.) Quantum
The courts are entitled to estimate losses.

5.) Third party funding
Third-party litigation funding is permitted.

6.) Allocation of costs/success fee
The "loser pays" principle applies.

7.) State cash in mechanism
If, after the expiry of a three-year period following a final
ruling, the benefits intended for compensation remain
uncollected, the State will be entitled to collect the funds.

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provider	schoenherr
name	sch-ckmdl, sch-nwsltr
runtime	1 year

provider	Matomo
name	_pk_id,_pk_ses