Class-Action Lawsuits in the Czech Republic: Benefits and Limitations

Quick Overview

• A class-action lawsuit allows for the joint adjudication of similar claims against a single business.
• The lawsuit is filed by an eligible nonprofit organization, which must be represented by an attorney.
• The group must have at least ten members.
• Plaintiffs must actively join the lawsuit. The court sets a deadline of two to four months from the publication of the final ruling on the admissibility of the lawsuit.
• A registered member generally does not bear the costs of the litigation, but must accept that the outcome is binding and that the organization may be entitled to a fee.

Not sure whether to pursue your claim jointly with other injured parties or on your own? As part of our “Lawsuit and Court Representation” service, we’ll review your documents and recommend the next steps.

Benefits of Class-Action Lawsuits

Class-action lawsuits allow people to join forces in a single legal proceeding—for example, when they have suffered similar damages due to the same unlawful conduct. By uniting under a single entity that helps them enforce their rights, they achieve many benefits:

• Cost savings —the costs of litigation are shared among all plaintiffs, which can be much more efficient and cost-effective than individual lawsuits. This allows people who, for example, would not have sufficient funds to pursue a lawsuit on their own to gain access to justice.
• Greater pressure on liable parties: Class-action lawsuits can exert stronger pressure on companies, organizations, or individuals responsible for the damages. If a company sees that it is facing dozens or hundreds of customers, this may force it to negotiate and resolve the dispute more quickly. The problem can thus be resolved more quickly, or the practices that led to the damages can be changed.
• A More Equal Playing Field: Would you dare to take on an energy provider, a major automaker, or a factory that pollutes the surrounding area and whose executives have close ties to local government officials? Given the prospect of their top-tier lawyers versus your financial resources, probably not. But even this disparity and imbalance of power can be overcome through class-action lawsuits. When multiple people join together in a single lawsuit, they have a stronger negotiating position and can better defend their rights.

Class Action Law: What Applies in the Czech Republic

The Class Action Law is officially titled the Act on Collective Civil Proceedings and has been in effect since July 1, 2024. It is therefore no longer a draft bill.

The law allows for the joint adjudication of similar claims by consumers against a business. For the purposes of this law, a business that employs fewer than ten people and whose annual revenue or total assets on the annual balance sheet do not exceed 50 million crowns is also considered a consumer.

Depending on the nature of the case, a lawsuit may seek, for example, payment of money, repair, or replacement of goods. However, the mere number of aggrieved parties is not sufficient: their claims must have a sufficiently similar factual and legal basis.

How Class-Action Lawsuits Work and What Their Limitations Are

The injured parties cannot file a lawsuit on their own: Aclass-action lawsuit may only be filed by an authorized legal entity registered on the relevant list, typically a nonprofit consumer organization. To be registered on the Czech list, such an organization must, among other things, have been actively working in the field of consumer protection for at least twelve months and meet additional requirements regarding non-profit status, independence, and transparency.

A practical limitation remains: aggrieved parties need an organization to take on their case. Simply joining forces with other customers or entering into an agreement with a law firm does not satisfy this requirement.

You must actively register for the proceeding: TheCzech system operates on an “opt-in” basis. It is therefore not enough to be among the aggrieved customers; you must file your claim in the prescribed manner. The court sets a registration period ranging from two to four months from the publication of the final ruling on the admissibility of the lawsuit in the class action registry. This is not a fixed four-month period for all cases.

How to File a Claim

1. Search for the relevant case in the Ministry of Justice’s list of class-action proceedings.
2. Verify that you meet the criteria for the class and that the filing period is still open.
3. Prepare the contract, proof of payment, and other supporting documents for your claim.
4. Fill out the prescribed form and submit it to the plaintiff organization according to the instructions provided.
5. Keep a copy of the filing receipt and monitor further updates on the proceedings.

The strategy regarding the choice of court to adjudicate class-action lawsuits is also surprising. In fact, onlya single Czech court will handle these cases: the Municipal Court in Prague. It makes perfect sense for a single court to adjudicate a class-action lawsuit; after all, that is its very essence. The question is whether it should be the Prague Municipal Court specifically. That court is already the exclusive court for enforcing industrial property rights. This raises the question of whether the court’s capacity will be sufficient to handle yet another extensive caseload.

The plaintiff’s compensation (i.e., the consumer organization bringing the lawsuit) is capped at 5% of the amount awarded. Even this is a low and rather unusual amount compared to other countries. It bears repeating that, on the other hand, the defendant is very likely to be a multinational corporation with strong professional and financial resources, which will require very careful preparation on the part of the plaintiff.

Joining the class action also has legal consequences

By participating in a class action, you gain the opportunity for collective enforcement; however, you will also be bound by a final judgment or a court-approved settlement. Therefore, if the case is decided against you on the merits, you cannot simply try to pursue the same claim again through your own lawsuit.

You may withdraw your application without restriction until the end of the registration period. After that, withdrawal is only possible in situations specified by law.

Not sure whether the definition of the class includes your case? Have your claim and options for further action assessed before deciding whether to join the class action.

Summary

Class-action lawsuits allow multiple injured parties to jointly pursue similar claims against the same business. Their advantages include joint professional representation and a reduced financial burden on individuals. However, Czech law requires the involvement of an authorized nonprofit organization and the active registration of the injured parties. Before joining the proceedings, it is therefore important to verify the conditions for group membership, the registration deadline, any fees charged by the organization, and the consequences of the final decision. A collective approach may be a suitable course of action, but it does not guarantee success or prompt payment of the claim.