The range of collective claims enforcement is expanding in Hungary – should we prepare for a wave of consumer compensation?

By: Trademagazin Date: 2022. 12. 06. 08:44

According to the rationale of the bill, the amendment to the law primarily seeks to find a solution to the social phenomenon that, with the spread of digitalization and the expansion of online commerce, an increasingly wide range of consumers may suffer damages as a result of the illegal commercial practices of businesses. The draft law offers a legal instrument for remedying this type of consumer rights violation, primarily by introducing the institution of a representative action.

Levente Molnár

A representative action is a special form of public interest action in the Hungarian legal environment. The point is that designated authorities and authorized organizations are given the right to initiate a lawsuit against the offending company in the event of violations of consumer protection legislation affecting a wide range of consumers, in order to enforce the civil rights of consumers.

The consumer protection and competition laws currently contain detailed rules that establish the authority of the authorities to initiate legal action in the case of civil law enforcement actions that affect a wide range of consumers. Another relevant background to the representative action is the fact that there have already been court rulings that opened the way for individual consumer compensation claims as a result of successful official action.