Ukraine adopts collective litigation system: a new step in consumer rights protection
In today’s evolving legal landscape, the protection of consumers’ rights is gaining new momentum as the Ukrainian government develops and implements innovative mechanisms to strengthen their effectiveness.
One of the most significant recent initiatives is the introduction of a collective lawsuit system, designed to enable large groups of consumers to jointly seek legal redress in court.
This approach aims to simplify the legal process, reduce the burden on judicial systems, and provide more transparent and accessible means of protection, ultimately enhancing citizens’ legal safeguards.The concept of collective action, widely used in common law countries under the term ‘Class Action,’ has a rich history of application in Western legal systems.
Initially serving to defend minority shareholders’ interests, it gradually expanded to include diverse areas such as consumer rights, environmental protection, labor rights, and other group interests.
Essentially, it allows organized citizens or public organizations to file joint suits when their collective interests are infringed upon by regulatory or commercial entities.Examples of such cases include mass actions against corporations like Apple, involving allegations of spying through Siri voice assistant.
Users reported that private conversations were recorded and shared with advertisers, who then displayed targeted ads based on their discussions.
Another notable case was against Apple for deliberately slowing down older iPhones to drive sales of newer models.
These examples underscore the urgent need for efficient mechanisms to protect consumer rights and interests.Although discussions about implementing a collective lawsuits institute in Ukraine date back to 2019, it has yet to be fully realized in law.
Nevertheless, certain elements of the concept find expression through appeals by civic environmental organizations and trade unions, pursuing the protection of ecological and labor rights, respectively, consistent with international conventions and national legislation.Today, policymakers and experts strive to establish a framework enabling not only individual but also collective protection for widespread groups of consumers and citizens.
As part of the draft law “On Protection of Collective Consumer Interests,” the Ministry of Economy has developed a bill that goes beyond formal harmonization with EU standards.
It proposes the creation of a representational claim institute, which builds upon and develops the traditional group action concept in line with modern European practices.The legislation aims to implement provisions of EU Directive 2020/1828, establishing standards for collective consumer claims across the European Union.
The EU already has considerable experience in this regard: for example, the Irish organization Irish Council for Civil Liberties has filed a representative claim against Microsoft for violations related to personal data processing and targeted advertising.In Ukraine, however, these principles will have specific features.
The draft law limits such claims exclusively to individual consumers—natural persons purchasing or using goods and services for personal needs, unrelated to commercial activity or employment.
Existing protection mechanisms—such as contractual and non-contractual measures—remain relevant and will complement the new institute.
A key innovation involves establishing qualified, non-profit organizations with at least one year of experience in consumer rights protection, which will be authorized to initiate and participate in collective lawsuits on behalf of groups or unidentified consumers.
They will also be responsible for informing the public about ongoing cases and their outcomes.Another vital aspect is the cross-border nature of such claims.
The law envisions that several qualified organizations from different EU countries could jointly file a collective claim when violations affect consumers across member states, reflecting European best practices.
To facilitate this, the Ministry of Economy will serve as a national contact point for cooperation with the European Commission and other EU countries.Furthermore, the bill anticipates mechanisms for transparency, including informing consumers about ongoing proceedings and outcomes, thus ensuring public awareness and participation.
Financial support for these actions will come from public funds, and such lawsuits will be free for consumers, with only nominal fees possible for certain procedural expenses.The right to submit a consent statement—either to be represented or to opt out of representation—will allow consumers to retain control over their participation in collective proceedings.
As Ukraine aligns its legal standards with EU directives, the possibility of transnational claims also emerges, enabling organizations from different states to collaborate on cross-border disputes involving multiple consumers.In conclusion, the new collective action system is poised to significantly enhance consumer rights protection by making legal processes more accessible, transparent, and effective.
Its success, however, largely depends on the capacity of the state and society to foster independent, professional, and resourceful organizations capable of truly representing citizens’ interests in collective legal actions.