Abstract
The EU Antitrust Damages Actions Directive does not include provisions for collective redress. Each EU member state is free to provide national regulation on this matter. The Portuguese legal system provided regulation on actio popularis since 1995. The ‘rational apathy’ of individual consumers may lead to non-reparation of damage and be of significant benefit for the company that is in breach of the law. The opt-out models solve the crucial economic problem caused by a large number of consumers or clients who have suffered a small loss because of competition law infringements. Under those circumstances, it is rational to be apathetic, because it can be foreseen that the cost of filing for compensatory damages will exceed the recovery obtained from the defendant. Such rational apathy of the parties injured by competition law infringements favours the wrongfully acting companies by not extracting their illegal gains from them. By not requiring the active consent of each of the claimants, the opt-out model is able to override rational apathy of consumers.
Highlights
The Portuguese legal system adopts an opt-out collective redress model, which can be filed by consumers who seek to be compensated for loss or damage caused by competition law infringements
Under Portuguese law, the claimant party is formed based on the opt-out model and the judge does not have the authority to decide whether the actio popularis follows the opt-in model or the opt-out model
The article argues that opt-out models solve the crucial economic problem caused by many consumers or clients suffering a small loss because of competition law infringements
Summary
Political, social and historical factors shape competition law, this article addresses the collective redress opt-out system, which is an important legal mechanism to grant compensation to consumers harmed by competition law infringement. The opt-out model has become part of the European legal experience since some EU Member States adopted it. D) Which are the rewards and safeguards adopted by the Portuguese opt-out collective redress action?. The Portuguese legal system adopts an opt-out collective redress model, which can be filed by consumers who seek to be compensated for loss or damage caused by competition law infringements. The Portuguese legal experience is relevant to the consumer compensation topic, given it does not follow the European Commission Recommendation on the opt-in model. It is important to understand whether the Portuguese collective redress system incorporates an accurate balance between rewards and safeguards, or whether it can lead to litigation abuse
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