The Ministry of Development has proposed an amendment to the Act dated 17 December 2009 on Pursuing Claims in a Class Action. The draft is a part of the Plan for Responsible Development “100 Changes for Companies – Facilitation Package for Undertakings” and was entered into the list of legislative and programme works for the Council of Ministers. The objective of the proposed amendment is to create a procedure that is less costly, less formal and which shortens court proceedings.
The government’s proposals include the introduction of an opt-out model for minor cases concerning, among other things, violations of consumer rights or Competition Law. The opt-in option would thus remain as the basic model and the opt-out solution would only be allowed to a limited extent. Furthermore, the introduction of a criterion of minor claims is proposed, i.e. a statutory determination of the maximum value of individual claims pursued in the opt-out model up to the amount of the equivalent of EUR 200 in the case of consumer claims and up to the equivalent of EUR 500 for undertakings.
The difference between the planned model and the current regulation concerns how the group of entities (the class) on whose behalf the proceedings are conducted is created.
Under the currently applicable opt-in model, in order to become a class member and to pursue your claim together with the class, you need to express a wish to participate in the class action – therefore, only persons who submit a written representation on joining the class within a relevant time period become its members and the class action may be conducted only for such members. The participation in a class action in the opt-in model thus requires a proactive approach from entities that wish to become class members and also involves meeting a number of formalities.
In turn, under the opt-out model proposed in the draft, which is applied in the United States, Belgium, Denmark and the United Kingdom, by operation of law entities that meet the given criteria (e.g. participated in a given event) would be included in the class action. Such entities automatically become class members (unless they declare that they wish to be excluded from the class and not be subject to the effects of the judgment). The proposal also stipulates the possibility for one person to institute a class action. In such case all consumers that were in a similar situation and incurred a loss due to the defendant’s activities will become claimants.
Furthermore, consumers will be informed of being a potential class member via the internet or through the press. The proposal assumes developing, under the Act, clear procedures of notifying the institution of a case and creating a central list of pending class actions (e.g. in the Public Information Bulletin of the Ministry of Justice).
Another change is the possibility for the class to be represented by the Ombudsman, the Financial Ombudsman and a national organisation with a statutory objective to protect the interests of undertakings.
The draft also introduces a procedure on the distribution of compensation awarded from the defendant between the class members. An entity performing a profession of public trust, specialising in fiduciary estate management for the benefit of creditors (e.g. administrator, receiver, trustee) and supervised by a court will be responsible for such distribution.