Class action lawsuits for the third time: The Czech Republic has been behind schedule for almost a year
At the end of last year, the Ministry of Justice introduced a draft Class Proceedings Act (the “Act”), which we discussed in Class Actions Act and Amendment of Related Provisions. In August this year, a new draft bill was circulated to MPs, which contained several amendments.
This is the third proposal submitted by the Ministry of Justice as an attempt to transpose the European Directive on representative actions for the protection of consumers’ collective interests of 25 November 2015 into the Czech legal system. The transposition deadline for this directive expired on 25 December 2022 already and the Czech Republic is therefore almost a year behind schedule.
The biggest change is the handling of the relationship to other class proceedings. The new bill says that publication of a final resolution on the admissibility of a class action does not preclude another class action proceeding from proceeding in court for the admissibility of the class action. There is also a new provision for consolidation of collective proceedings, which the court may only decide on with the consent of all plaintiffs. And further also the procedure for changing collective proceedings or the relationship to individual proceedings.
The court may now impose a fine of up to CZK 5,000,000 on those who fail to comply with their obligations under this Act, in particular by failing to publish information about the commencement and conduct of the collective proceedings or failing to submit evidence. In determining the amount of the fine, the court will take into account the significance of the obligation breached, the extent and gravity of the breach.
In mid-September, the first reading took place in the Chamber of Deputies, where the proposal was referred to committees for discussion within 90 days. We will have to wait at least another month for further development.
Author: Veronika Odrobinová, Lucie Nováková