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New Italian Class Action Rules Enter Into Force on May 19, 2021

Yesterday, Wednesday, May 19, 2021, the new rules governing expanded class action lawsuits in Italy entered into force.

The new class action system applies to claims related to conducts put in place starting from today.

 

Key Changes

The following key changes introduced in favor of claimants are expected to generate a significant increase of class action litigation in Italy:

  • Widened subject matter scope of laws applicable to class actions: now available to anyone (both consumers and businesses), who will claim a compensation for a violation of "homogeneous individual rights," regardless of the area of law. Under the previous system, class actions could only be started by consumers for claims related to alleged unlawful conducts falling in specifically identified areas of law—i.e., antitrust infringements, unfair commercial practices, violations of contractual rights of a plurality of consumers, and product liability. Under the new system, it will be possible to start a class action in areas of law, which were previously precluded, such as for violations of environmental, employment or health care rights.
  • Expanded opt-in system: the new system allows eligible class members to join a class action even after the court's favorable judgment on the merits (this will prevent defendant companies from knowing until the end of the lawsuit the actual perimeter of the class).
  • New contingency fees in favor of the common representative of the class and of the lead claimants' lawyer ("quota lite"). This will clearly be an incentive to promote potential class actions and may assume punitive connotations, which would be totally new in the Italian legal system.
  • Enhanced courts' powers in the field of evidence, such as wider disclosure orders with the possibility to impose fines in case of non-compliance. Discovery power in Italian class actions have expanded.
  • Settlement agreements encouraged by enabling competent courts and common representative of the class to take the initiative and submit settlement proposals to all parties.

Business are well advised to be ready and adopt pro-active measures in order to contain the likely increased class action litigation risks, such as (i) implement effective antitrust compliance programs, (ii) review their insurance policies, (iii) set up adequate budget provisions as soon as they become aware of potential class action exposure, and (iv) establish effective communication links with local consumer associations, which are expected to try to take advantage of the above incentives.

Class actions have long been associated with the US legal system since the 1960s, and in fact, American class action lawyers have opened up offices throughout Europe. The new legislation can be expected to, and is designed to, increase class actions in Italy.

White & Case will be closely monitoring how the new legislation affects class action cases and trends in Italy.

Summary Table of Key Changes:

Before May 19, 2021

After May 19, 2021                                  

Italian Consumer Code 

Italian Code of Civil Procedure (ICCP)

Limited to consumers and specific matters 

Not only consumers, but also businesses 

Opt-in before the decision on the merits

Opt-in possible after the favorable decision on the merits

Ordinary Courts 

Specialized Business Divisions of the Courts

Ordinary proceeding rules 

Summary proceeding rules under Articles 702 bis ICCP

Still applicable to (current and future) class actions related to conducts carried out before May 19, 2021

Applicable to class actions related to conducts carried out after May 19, 2021

 

New incentives for claimants (e.g., contingency fees, enhanced courts’ powers in the field of evidence)

 

Incentives for settlement agreements 

 

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