Minister of Justice believes class-action suits will come to Finland
Johannes Koskinen
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Finland's Minister of Justice Johannes Koskinen (SDP) believes that Finland will introduce the possibility of class-action lawsuits. A working group is to submit a proposal on the issue in January.
A class-action suit allows a large number of plaintiffs to collectively sue a single company or individual. Typical causes of action in class-action suits are cases of environmental damage or consumer grievances. Currently Sweden is the only EU country with a law allowing class-action suits. Germany, France, The Netherlands, and the UK have somewhat similar systems on the books.
The Finnish business community has taken a negative view of class-action suits, fearing that it would subject companies to legal blackmail.
Minister of Justice Koskinen discounts fears that the introduction of class-action suits would allow law firms to shake down businesses, noting that there are legal protections against this.
The working group was set up by the Ministry of Justice nearly a year ago. It was to have issued its final report earlier, but its deadline was extended until the end of January.
Consumer organisations see class-action suits as a useful means to deal with situations in which the harm suffered by single individuals in cases of defective products, for instance, is so small that the costs of litigation would discourage pursuing the matter in court.
Koskinen rejects fears that the system would lead to an American-style practice of massive monetary damages. He says that a possible Finnish law on class-action suits would resemble the Swedish model, and that the aim would be primarily to win compensation for actual harm done.
He also says that he has not engaged in any "manual steering" of the working group, and that it is up to the group to decide whether or not to make any concrete legal proposals.
"In any case, a more general debate will be launched on the basis of this matter, so that the law can take effect during the present Parliamentary term.", Koskinen says.
The working group is believed to be listing the positive and negative aspects of allowing for class-action suits. It is not expected to make any actual proposals for legislative change.Pentti Mäkinen, head of business policy at the Central Chamber of Commerce, says that to do so would violate both the government's programme and the mandate of the working group.
Mäkinen also says that even if the law would limit the awards in class-action suits to compensation for actual monetary losses, the business community fears that there could be attempts to pressure companies into paying groundless compensation just to avoid the costs of litigation. He notes that the web sites of some Swedish law firms have ready models on display to encourage clients to take action even for the smallest of complaints.
"The suits would target companies operating properly in hopes that some compensation might be forthcoming by threatening to raise a class-action suit." Mäkinen adds that the best of Finnish companies follow the recommendations of consumer protection authorities nearly 100%, and that those who do not, are out of reach anyway, because they have no assets.
Mäkinen says that a more efficient way to promote consumer rights would be to strengthen Finland's present consumer protection system, which he says is the best in the world.
The Central Chamber of Commerce proposes increasing the resources of the Consumer Complaints Board.
Mäkinen also suggests that the Consumer Ombudsman could push complaints in court on behalf of larger numbers of plaintiffs, and that the impact of the decision could also benefit those consumers who did not take part in the action. "The possibility of abuse would be considerably reduced if the person pursuing the complaint does so as a civil servant."
Helsingin Sanomat
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| 28.12.2004 - TODAY |
 Minister of Justice believes class-action suits will come to Finland |
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