GERMANY Law and Practice Contributed by: Tanja Pfitzner, Fabian von Schlabrendorff and Niklas-Arne Hecht, Pfitzner Legal
of process will be affected in accordance with the international principles relating to reciprocity in granting judicial assistance. If service of process is not possible, the court may order service by public notice – ie, by dis- playing a summary of the statement of claim and a notice where the statement of claim can be inspected on the notice board of the court and by publication in the Federal Gazette and, if appropriate, in daily newspapers. The state- ment of claim is deemed to have been served one month after the date of the last of these publications. 3.6 Failure to Respond If the defendant fails to respond to the statement of claim or does not appear before the court at the hearing, the court may, at the request of the plaintiff, issue a default judgment granting the plaintiff’s claim(s). If a judgment by default has been delivered, the defendant may lodge an objection within two weeks of service of the judgment. The proceed- ings are then restored to the state in which they were before the defendant’s default. 3.7 Representative or Collective Actions Representative or collective actions are not tra- ditionally recognised. It is a fundamental prin- ciple of German civil procedural law that only the parties to civil proceedings are bound by the outcome of such proceedings. In recent years, however, the legislature has created certain forms of collective actions in some areas. Injunctions Act The most important form of collective proceed- ings has been the right of certain registered interest groups to bring an action for injunc- tive relief on behalf of their members and in the
common interest, particularly in cases involving unfair business practices by companies towards consumers, invalid general terms and conditions or other practices that violate consumer protec- tion law or copyright law. Model Proceedings in Capital Market Disputes In case of false, misleading or incomplete capital market information, certain legal or factual issues relevant to many pending civil proceedings can be decided in model proceedings with binding effect for all. Proceedings may also be initiated if such information is used or if a required dis- closure is omitted. This law may also be applied in the case of claims for performance under a contract based on an offer under the Securi- ties Acquisition and Takeover Act. Since 2024, claims against custodians of crypto-assets as well as claims related to ratings for issuers or providers of investments and auditors’ reports on the annual financial statements and consoli- dated financial statements of issuers of capital investments can also be decided in model pro- ceedings. Such model proceedings take place if at least ten plaintiffs file a corresponding petition in individual proceedings. The model proceed- ings are then conducted before the competent higher regional court and, on appeal, before the Federal Court of Justice. The issues established in the model decision are binding for the parties in the individual proceedings. All other aspects of the respective cases, eg, causal connection or amount of damage, are decided by the courts of the individual proceedings. Model Declaratory Action In 2018, the legislature introduced a model declaratory action to facilitate collective redress for consumers in cases of mass damages caused by large companies. It cannot be initi- ated by individual consumers, but only by cer-
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