SLOVENIA Trends and Developments Contributed by: Bojan Brežan, Marko Frantar, Maks David Osojnik and Špela Lovšin, Schoenherr Slovenia
Actions Act, Slovenian legal system was not familiar with third-party funding. It is anticipated that this will change as collective redress becomes more widely used in practice. If a collective action is funded from external sources, this must be disclosed to the court. The court will review the financing arrangement and will dismiss the action in cases of – among other things – con- flict of interests, undue influence of the funder on the plaintiff’s procedural decisions, absence of proof of sufficient funds, or in cases where the funder is a com- petitor of the defendant. Implementation of the EU’s Collective Redress Directive 2020/1828 On 25 November 2020, the European Parliament and the Council adopted the Directive 2020/1828 on rep- resentative actions for the protection of the collec- tive interests of consumers. The Directive 2020/1828 represents a second pillar of the EU’s New Deal for Consumers and is aimed at ensuring effective means for consumers to bring unlawful practices to an end and obtain redress, thereby protecting fair competi- tion and smooth functioning of the internal market. The deadline for national implementation was 25 December 2022. Slovenia implemented the said Directive by means of adopting the ZKolT-A amendment to the Collective Actions Act which came into effect in January 2024. Outlook: A Proliferation of Collective Actions? Looking ahead, Slovenia can expect to see an increase in the use of collective actions in the (near) future. This activity will be driven in part by the regulatory environ- ment – not least the ever-increasing demands placed by the EU and national legislators on consumer-facing industries – and the availability of third-party funding.
The majority of collective actions filed to date have been consumer-driven. While this is likely to remain the case in the near future, it will be interesting to see if collective redress will also be pursued in other areas – for example, in antitrust, environmental or securi- ties/market abuse-related matters. At the same time, additional organisations are expected to bring collec- tive actions. Slovenia, as said, permits contingency fees in case of lawyer-sponsored collective actions (subject to statutory conditions). The majority of recently initiat- ed collective actions have been financed by lawyers and, all things being equal, third-party funding (not limited only to lawyer-funded litigations) is expected to become the norm when it comes to financing col- lective actions in Slovenia. This is largely down to the fact that third-party funding by professional litigation funders is also becoming increasingly prominent in continental European jurisdictions ‒ not just in arbitral proceedings, but in regular litigation as well. Now that the Collective Actions Act provides the pro- cedural framework to bring bigger-ticket cases before the courts, Slovenia can expect to attract the inter- est of active funders in the region. Although certain aspects of permitting funding agreements under the Collective Actions Act still require judicial interpreta- tion, the framework seems robust enough to enable rather than inhibit such arrangements and, conse- quently, increase the number of collective actions brought.
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