CZECH REPUBLIC Law and Practice Contributed by: Robert Němec, Michal Sylla, Viktor Glatz and Adéla Šmahelová, PRK Partners
PRK Partners Jáchymova 26/2 110 00 Prague 1 Czech Republic Tel: +420 221 430 111 Email: prague@prkpartners.com Web: www.prkpartners.com
1. Policy Development of Collective Redress/Class Action Mechanisms 1.1 History and Policy Drivers of the Legislative Regime Traditionally, there was no uniform and comprehensive regulation of collective redress in the Czech Republic. The Czech legal system contained only very limited representative action mechanisms, which did not allow collectively asserting individual rights in a man- ner other than through regular court proceedings and were applicable only to a limited range of claimants or to relatively specific matters. These included pro- ceedings concerning copyright or protection against unfair competition, consumer protection claims or claims for damages or for adequate consideration arising in connection with mandatory takeover bids or squeeze-outs. With effect from 1 July 2024, a new legal framework of collective redress was adopted as a transposition of Directive (EU) 2020/1828 of the European Parlia- ment and of the Council of 25 November 2020 on representative actions for the protection of the col- lective interests of consumers and repealing Directive 2009/22/EC (the RAD). Collective action proceedings in the Czech Republic are now primarily regulated by Act No 179/2024 Coll. on Collective Civil Court Pro- ceedings (the Collective Proceedings Act). The RAD transposition also included the adoption of Act No 180/2024 Coll. on the Amendment of Certain Laws in Relation to the Adoption of the Collective Proceed- ings Act (the Ancillary Act), containing amendments to Act No 99/1963 Coll, the Code of Civil Procedure (the Code of Civil Procedure), Act No 549/1991 on Court
Fees (the Court Fee Act) and Act No 634/1992 Coll. on Consumer Protection (the Consumer Protection Act). Prior to the Collective Proceedings Act, there had been some legislative attempts to introduce a com- prehensive regulation of collective redress in the Czech Republic since 2017, leading to the draft leg- islation that was presented by the former government in 2020. In this draft, a more comprehensive approach to the issue of collective actions was taken, as it pro- vided the possibility of filing collective actions for a relatively unlimited range of claims and provided for the possibility of both opt-in and opt-out mechanisms depending on the size of the group and the amounts claimed per group member. Similarly, the parties hav- ing standing to bring collective actions were not sig- nificantly limited under this proposal. As a consequence of the parliamentary elections in 2021 and the subsequent change in the government, this draft was withdrawn and the current government presented a new draft, eventually resulting in the Col- lective Proceedings Act. The Collective Proceedings Act takes a slightly more conservative approach to the introduction of collective redress mechanisms into the Czech legal system compared to the previous draft and in many aspects only mirrors the minimum requirements set out by the RAD. The general policy driver presented to justify the intro- duction of collective redress mechanisms into the Czech legal system was to create a better balance between large corporations and consumers in matters where pursuing their rights individually would create a disproportionate burden on the consumers, often causing so-called rational apathy on the consumers’
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