Collective actions may be brought in Sweden under a number of procedures, including a statutory class action process. Under this procedure, the court must approve the suitability of a class action for determining the dispute and the class of claimants, all of whom must be identifiable, will be defined. The action is brought by a representative claimant on behalf of all the members of the class who have opted in. Group actions and representative actions are also available.
There are ongoing discussions as to whether class actions should be made “opt out”, to increase the effectiveness of the legislation. However, to date, no such reforms have been formally proposed.
What forms of collective actions are permitted in this jurisdiction and under what authority?
The following types of collective actions are permissible in Sweden:
Class actions are permitted under the conditions set out in the Swedish Group Proceedings Act (“Act”) (Sw. lag (2002:599) om grupprättegång) which came into force on 1 January 2003.
A class action may only be brought if it is considered to be the most suitable form of legal action in the particular case. Under section 8 of the Act, the court may accept a class action only if:
- the claims of the members of the group are based on circumstances that are common or of a similar nature;
- the class action is not deemed unmanageable due to substantial differences in the legal basis of the claims of different members of the group;
- the majority of the claims to which the action relates cannot be equally well pursued by private actions brought by individual members of the group;
- the group is appropriately defined, taking into consideration its size, ambit and other factors; and
- the claimant, bringing the action on behalf of the group, is deemed an appropriate representative, taking into consideration the claimant’s interest in the substantive matter, the claimant’s financial capacity to bring a class action and other relevant circumstances.
Group actions can be brought by consolidating several individual cases for procedural management purposes. Consolidation is made under the general Swedish procedural rules (Chapter 14 of the Code of Judicial Procedure (Sw. Rättegångsbalk 1942:740)).
A representative action can be brought in accordance with the Swedish class action framework. In addition, in employment-related disputes, trade unions and employer representative organisations may represent, as well as initiate and conduct legal proceedings on behalf of, their members (section 5 of the Act).
Who may bring them?
Under the Act, class action proceedings are brought by the claimant as the representative of the persons on whose behalf the action is brought. A group action may be instituted as a private group action, an organisation action or a public group action (section 1 of the Act).
Opt in or opt out?
The Act is based on the opt in solution. Thus, a member of the group must actively choose to be included as a member of the group. Only clearly identified members who have chosen to opt in will be allowed to participate in the proceedings (section 14 of the Act).
Such members are not parties to the proceedings but are nevertheless covered by any ruling of the court (sections 1 and 15 of the Act).
Any civil claims (provided they fulfil the preconditions stipulated in section 8 of the Act as set out above) can be brought by means of a class action (section 2 of the Act).
Class actions can be brought by:
- a natural or legal person if the claimant itself has a claim covered by the action (a “private” action);
- a non-profit organisation that, in accordance with its rules, aims to protect consumer or wage-earner interests in disputes between consumers and commercial organisations regarding any goods, services or other utilities that the organisations offer the consumers (an “organisation” action); and
- an authority that, taking into consideration the subject of dispute, is suitable to represent the members of the group and has been authorised by the Government to initiate certain class actions (a “public” action (section 4-6 of the Act).
Judge or jury?
All civil actions are tried by judges (section 2 of the Act and Chapter 1-3 of the Code of Judicial Procedure).
What relief may be obtained?
All forms of redress that are available under usual civil litigation rules are also available in class actions, including actions for damages and injunctive measures under the Swedish Environmental Code (Sw. Miljöbalk 1998:808) and actions for damages under the Swedish Competition Damages Act (Sw. Konkurrensskadelag 2016:964) (section 2 of the Act).
Punitive damages are not generally an available remedy under Swedish law.
How are such actions funded?
The general rules on litigation costs in Swedish civil law cases are applicable; thus, the unsuccessful party is generally obliged to pay the successful party’s legal costs (section 2 of the Act and Chapter 18 of the Code of Judicial Procedure).
Contingency fees are generally not permissible in Sweden. However, in class action disputes, the claimant may enter into a so-called risk agreement with his lawyer as regards the legal fees. According to section 39 of the Act, a risk agreement may only be approved if the agreement is deemed reasonable when taking into account the nature of the substantive matter. The agreement shall be concluded in writing and indicate the way in which the fees will deviate from normal fees if the claims of the members of the group were to be successful or fail. The agreement may not be approved if the fees are based solely on the value of the subject of dispute.
Government funding is only available for class actions brought by way of public actions and in other specific circumstances, but not for class actions generally.
Is pre-trial disclosure available?
Likely future scope and development?
Since the Act entered into force, only a few class actions have been subject to court hearings as most of the cases have been settled outside court. However, consumer awareness of group actions appears to have increased and there are on-going discussions regarding whether the opt in solution should be changed to an opt out solution, in order to increase the effectiveness of the legislation. As at the time of writing, the discussions have not resulted in any amendments and the opt in solution is still in force. Neither has the publication of EU Recommendation 2013/396/EU on common principles for injunctive and compensatory collective redress mechanisms in EU countries resulted in any amendments to the Act.