One Year Of Model Declaratory Action In Germany – Taking Stock And Outlook


Fuelled by revelations consequent of the Volkswagen diesel emissions technology cases, the German legislator hastily introduced a new law on Model Declaratory Action (Musterfeststellungsklage). This denotes an important step by the German legislator into the direction of collective redress in B2C relationships. The Model Declaratory Action entered into force one year ago, on 1 November 2018. Its first anniversary warrants a first review.

Following a reminder of the essential elements of the Model Declaratory Action, Tilmann Hertel from our Frankfurt office will take stock of cases that have been brought to date, noting their key elements. It transpired that the Model Declaratory Action is no lex Volkswagen but instead has a wider remit of application and claimants are likely gearing up for further actions, as will be laid out in an outlook of what companies may potentially expect in the future.

The main features of the Model Declaratory Action

By way of reminder, here is a snapshot of the main features of the Model Declaratory Action:

B2C relationship: the Model Declaratory Proceedings are only available in business to consumer scenarios. Limited group of potential claimants: in order to pre-empt a potential misuse of the Model Declaratory Action for the own financial interest of those bringing the claim, the group of potential claimants is restricted to so-called qualified institutions, such as consumer associations. These have to fulfil a number of requirements such as, amongst others, that the claimant organisation does not pursue its own financial interest but rather serves the consumer's interests. Only qualified institutions are allowed to bring a Model Declaratory Action. Low thresholds for bringing a claim: the thresholds for bringing a claim are low. A qualified institution has to substantiate that 10 consumers are affected and within two months following the registration of the Model Declaratory Proceedings, a minimum of 50 have to register their alleged claims in a claims register. Consumers can register their claims: consumers are not directly involved in the proceedings, they have no standing and will not be heard. Consumers however benefit from the Model Declaratory Action by registering their claims online. Provided that the consumer's claim rests on the same grounds as that of the Model Declaratory Action, this has mainly two effects: firstly, the limitation period is suspended for the duration of the Model Proceedings...

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