New Law in Bulgaria Allows Free Class Actions Against Merchants

Business | June 15, 2024, Saturday // 10:32|  views

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Bulgaria is poised to implement significant changes to its Consumer Protection Act, aligning with EU Directive (EU) 2020/1828 to empower consumers in collective legal actions against merchants. Under the proposed amendments, not only consumer associations but also the Consumer Protection Commission and designated qualified organizations can file representative claims for damages. These organizations will adhere to uniform criteria at both national and cross-border levels.

The draft law introduces a new chapter in the Civil Procedure Code specifically addressing representative claims for consumer interests. When seeking compensation for damages, courts will ascertain merchant liability and specify eligible damages per user or user category. Participants in such claims cannot engage in similar actions against the same merchant individually or collectively.

Furthermore, the legislation mandates a timeframe for merchants to compensate affected consumers post-court decision, with no cost burden on individual participants in the claim. It also suspends limitation periods during the filing and processing of representative claims, ensuring consumer rights are protected.

Additionally, the bill includes provisions for court oversight to prevent conflicts of interest when third-party funding is involved in representative actions. Decisions confirming violations of consumer interests will serve as evidence in subsequent damages claims against the same merchant, extending beyond the parties initially involved, which contrasts with current laws that limit the impact to those directly engaged in the legal process.

Moreover, the directive mandates that traders disclose previous prices when announcing price reductions, ensuring transparency and fair practices in consumer transactions. For short-term promotions, such as food sales lasting less than 30 days, the period for disclosing previous prices is set at 7 days, reflecting the directive's consumer-focused approach to pricing transparency and protection.

The proposed amendments aim to bolster consumer rights in Bulgaria, ensuring robust legal mechanisms are in place to address collective grievances and enhance accountability among merchants in the marketplace.

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Tags: Bulgaria, consumer, protection, merchants

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