Collective legal protection is on the move: In Germany, the grand coalition pushed for the introduction of a civil procedural model declaratory action through the legislative bodies in 2018, the first proceedings are ongoing or have already ended in part. In addition, the EU consumer association lawsuits directive must now be implemented, which obliges the EU member states to introduce collective legal protection instruments that go far beyond what has been known in Germany up to now.
The model declaratory judgment
In Germany, collective legal protection has traditionally been viewed critically, also against the background of fears that American conditions (“class actions”) could come about. The position in large parts of German politics changed, especially with regard to the diesel scandal. The goals are the improvement of consumer protection and the relief of the judiciary. The government parties had already announced in the coalition agreement that they would introduce model declaratory actions by the end of 2018. The grand coalition put this plan into practice in a hurry: the “Law on the introduction of a civil procedural model declaratory action” was passed on 17.7 . Published in the Federal Law Gazette in 2018 and came into force on November 1, 2018.
Since then, certain qualified institutions in Germany have been entitled to file a model declaratory action with the aim of establishing the (non-) existence of factual and legal requirements for the (non-) existence of claims or legal relationships between consumers and an entrepreneur. The court should then make binding decisions on disputes that do not have to be clarified individually in individual processes. However, those affected must bring the legal dispute to an end themselves, unless a settlement has already been reached through the model determination. The first lawsuits have meanwhile ended.
The EU Consumer Association Actions Directive and its implementation in Germany
The European Union has also been considering collective redress for some time. After various non-binding initiatives remained largely ineffective and the EU saw itself forced to act by the diesel scandal, the EU consumer association lawsuit directive was passed at the end of 2020. With the new Directive (EU) 2020/1828Member States are obliged to introduce collective actions that can be brought by so-called qualified institutions such as consumer associations on behalf of injured parties in the event of violations of certain consumer protection legal acts, for example in order to enforce injunctive relief, remedial measures or damages. The directive thus grants the qualified institutions extensive legal standing and therefore differs significantly from the German model declaratory action, which only leads to the establishment of a legal relationship and after which the individual consumer must assert his claim in individual proceedings. However, the EU representative action differs not only in terms of the basic concept, warning ).
According to the directive, member states had until 12/25/2022 to transpose the directive into national law and have another 6 months to apply the new regulations. Only three Member States implemented the Directive on time (see our Implementation Tracker ) and the Commission has accordingly initiated infringement procedures against the other Member States (more in our blog post ). Germany is also one of the latter.
The draft bill of the German Ministry of Justice from February 2023 is mainly based on the minimum requirements of the directive and provides for a new main law, the Consumer Rights Enforcement Act, into which the model declaratory action currently regulated in the ZPO is to be integrated (more on this in our blog post ) . This approach is pursued further in the government draft of March 29, 2023, which, however, deviates from the draft bill in some points in favor of consumers (more on this soon in our blog ).
Outlook
The remedial action planned as part of the implementation of the EU directive represents a novelty in German law, but is stipulated by the directive and therefore does not come as a surprise. It remains to be seen whether the further legislative process will bring changes. After the adoption of the government draft, both the SPD parliamentary group and the Bündnis 90/Die Grünen parliamentary group reported a need for change, which is to be addressed in the further parliamentary procedure.
Further information on the consumer association lawsuit directive and its implementation into German law can be found on our legislative project page in the Knowledge Portal , which is continuously updated – also with regard to the implementation of the directive into German law.
In our Implementation Tracker we keep you informed about the implementation of the directive in selected jurisdictions. Visit our global collective redress hub .
For further information, please contact:
Dr Rupert Bellinghausen, Partner, Linklaters
rupert.bellinghausen@linklaters.com
