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Malta

Author: Clement Bonnici

I. Factsheet

Scope

Two horizontal mechanisms available:

(a) Collective Action

(b) Collective Proceedings action

Both mechanisms allow for injunctive and compensatory relief.

Standing (Para. 4-7)

Collective Proceedings

A distinction is made between a representative action (brought by a registered consumer association or an ad-hoc constituted body on behalf of class members) and a group action (brought by a class representative on behalf of class members).

Consumer association or an ad-hoc constituted body needs to show that there is no material interest that is in conflict with the interests of the class members. A class representative (not being a registered consumer association) must have also had a claim which falls within the proposed collective proceedings, is expected to act fairly and adequately act in the interests of the class members; and must not have, in relation to the common issues for the class members, a material interest that is in conflict with the interests of the class members.

Problems/Incompatibilities with Recommendation principles

Public authorities are not empowered to bring representative actions.

In the case of a representative action brought forward by a registered consumer association, there are no requirements as to its sufficient capacity (financial resources, humans resources and legal expertise) to properly represent the class members in their best interests.

Admissibility (Para. 8-9)

Court determines of its own motion whether the statutory eligibility requirements have been met.

Information on Collective Redress (Para. 10-12, 35-37)

Decree of group constitution and issues is to be published in the Government Gazette and in a local English and Maltese newspaper and in any other media with an invitation to any other third parties who wish to be class members must indicate their intention to do so within roughly 5 months from the date of the decree.

Problems/Incompatibilities with Recommendation principles

No national registry. Absence of proper framework for dissemination of information

Funding (Para. 14-16)

No provisions on third-party litigation funding. Champerty is not allowed.

Problems/Incompatibilities with Recommendation principles

No framework for the provision of funding. Law falls short of the Recommendation, in particular points 14, 15, 16 and 32. No specific rules on whether the court is allowed to stay proceedings if the instances outlined in para. 15 of the Recommendation exists.

Cross Border Cases (Para. 17-18)

National rules on admissibility or standing facilitate foreign claimant or foreign representative entity involvement.

Expedient procedures for injunctive orders (Para. 19)

Interim injunctive order is possible. The court is required at law to deliver the judgment on whether the warrant is to be upheld permanently within 1 month from the date the application for an injunction was filed.

Efficient enforcement of injunctive orders (Para. 20)

A warrant for a prohibitory injunction is deemed to be a court order. Breach of such order is a criminal offence.

Opt-In/Opt-Out (Para. 21-24)

Opt-in by express consent and requirement of collective proceedings agreement. Conditions prescribed by law, supplemented by the discretion of the judge.

A class member who does not opt-in by the time period laid down in decree may only opt-in with special leave from the court if the delay was not attributable to the applicant and the continuation of the proceedings would not suffer substantial prejudice if permission were granted.

Problems/Incompatibilities with Recommendation principles

Likely that class member can opt-out if he or she is permitted to do so in terms of the collective proceedings agreement. The right of a class member to opt-out at any stage during the collective proceedings should be introduced in the Act, naturally subject to certain conditions on sharing of costs and other pertinent issues.

Collective ADR and Settlements (Para. 25-28)

A class representative may only reach a compromise with the defendant/s with the permission of the court. The court will require the class representative to inform the court on how he intends to notify the class members and on the terms of the proposed compromise. In line with the opt-in principle, any class member may, with the permission of the court, be omitted from the compromise. Court approves the compromise.

Costs (Para. 13)

Loser Pays Principle applies. The possible penalty of €2,500 imposed where the court finds that the collective proceedings were frivolous or vexatious.

Lawyers' Fees Para. 29-30

Advocates are not allowed to agree to a stipulation quotae litis. Fees are to be in line with a tariff established by law

Prohibition of punitive damages (Para. 31)

Punitive damages not allowed. The damages which may be claimed are either patrimonial, which refer to losses suffered directly by the claimant's patrimony or estate, whether past, present or future, or non-patrimonial, which refer to moral anguish and pain and suffering.

Collective Follow- on actions (Para 33-34)

Collective follow-on actions possible in competition law.

The interplay between injunctions and compensation across all sectors

Injunctive and compensatory relief may be sought within single proceedings. At present in consumer and competition cases. Follow-on damages actions may rely on injunctions order.

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