In Italy, a law on class actions was enacted in 2010. The law was slightly amended in 2012 and was significantly amended in 2019 (Law no. 31/2019, the "Class Action"). The Class Action is currently provided for in the Code of Civil Procedure, from Article 840-bis to Article 840-sexiesdecies (previously it was contained in Legislative Decree 6 September 2005, No. 206, the "Consumer Code").

The Class Action is available to both consumers and non-consumers who claim compensation for a violation of "homogeneous individual rights," regardless of the area of law. The Class Action is based on the opt-in mechanism. Members of a class, individually or through associations to which they grant power or committees in which they participate, are entitled to start a Class Action to seek collective redress or restitution against companies or providers of public services.

The protected interests must be homogeneous to all members of the class. Homogeneous rights include:

• contractual rights of consumers and users who are in the same situation against the same trader (e.g. rights arising from standard terms and conditions and mass contracts);
• identical rights arising from product liability, even in the absence of a direct contractual relationship;
• identical rights to compensation for damage suffered due to unfair commercial practices or anti-competitive conduct.

Directive(EU) 2020/1828 on representative actions for consumers ("RAD") has been implemented in Italy through Legislative Decree No. 28/2023 ("Representative Action"). The law implementing RAD inserted twelve new articles (from 140-ter to 140-quaterdecies) into the Consumer Code, while the Class Action remains governed in the Code of Civil Procedure and is still in force and effect. The Representative Action is conceived as a separate mechanism.

However, Representative Action is designed as the exclusive means against domestic and cross-border infringements referred to in Annex II-septies to Art. 140-ter of the Consumer Code that harm, or may harm, the consumers’ collective interests. Annex II-septies includes a broad range of areas, including (i) breaches of the legislations on safety and product liability, (ii) unfair terms in consumer contracts, (iii) sale of consumer goods and related warranties, (iv) e-commerce, (v) data protection in the electronic communication sectors, (v) distance marketing of consumer financial services, (vi) unfair commercial practices and misleading and comparative advertising, (vii) tourism and travel (including sea, air, and land transport of passengers), (viii) payment services, (ix) energy and telecommunications, (x) medical devices and in vitro diagnostic medical devices, and (xi) contracts for the supply of digital content and digital services. The Representative Actions’ scope of application can be extended by the Italian Ministry for Business and Made in Italy when new EU laws for consumer protection are issued.

There are some grey areas as to the distinction between the Class Action and the Representative Action which may give rise to legal and procedural issues.

Qualified entities can seek either for injunctive measures aimed at ceasing or forbidding any conduct in breach of EU laws or redress measures aimed at remedying the consequences of the infringements of EU provisions on consumers. Unlike the Class Action, the two measures can be jointly granted by the court in the same proceeding.

Representative Actions started to obtain the release of injunctive measures can be brought only where defendants have not complied with an out-of-court request to cease conduct in violation of one or more EU laws. This request is to be sent by qualified entities via registered letter or certified email in the 15 days prior to the filing of the Representative Action. An interim measure may be also granted if justified reasons of urgency are met.

As far as redress measures are concerned, in addition to compensatory measures qualified entities can also seek for the reduction or full reimbursement of the price paid, repair or replacement of the good/service purchased, or termination of the contract entered into by consumers with the defendant, according to the applicable EU law violated.

Under Italian law, the loser-pays principle is the general rule. However, courts have a high degree of discretion in allocating costs, depending on several factors, such as the complexity of the case, the parties’ conduct in the proceedings and the nature of the dispute.

In any case, Italian Courts do not award the winning party with the legal costs actually incurred. Legal costs are liquidated by the Court based on a fees chart periodically issued by the Ministry of Justice. Such fees range between a minimum and a maximum and vary depending on the amount in dispute.

As to the Representative Actions, the law implementing RAD specifies, in line with RAD, that in connection with redress measures a consumer who opted-in but saw her/his compensatory claim rejected may be ordered to pay legal costs to the defendant only in case of bad faith or gross negligence (Art. 140-novies of the Consumer Code).

In line with RAD, Art. 140-novies of the Consumer Code provides that court fees (which in Italy are in any case low) are halved.

Article 140-novies of the Consumer Code provides, through a reference to the rules applying to Class Actions, that with the decree upholding the claims for opting in, the court orders the defendant to pay directly to the qualified entity and to the claimant’s lawyer a sum equal to a percentage – which is progressive and based on the number of the participants in the class action – of the total amount due by the defendant to the members of the class action, as follows:

• 1 to 500 members: amount not exceeding 9% of the overall amount due to all members of the class;
• 501 to 1000 members: amount not exceeding 6%;
• 1001 to 10,000 members: amount not exceeding 3%;
• 100,001 to 1 million members: amount not exceeding 1.5%;
• over 1 million members: amount not exceeding 1%.

With the measure that defines injunctions requests, the judge shall set a time limit for the fulfillment of the established obligations and, also upon request of the party that has taken legal action, shall order, in the event of default, the payment of a sum of money ranging from EUR1,000 to 5,000, for each default or day of delay, taking into account the seriousness and duration of the violation. These sums shall be paid to a specific chapter of the state budget revenue to be reallocated 50% to the Ministry of Justice and the remaining 50% to the Ministry of Business and Made in Italy.

The provisions of the Consumer Code on the Representative Actions apply as of 25 June 2023.

Article 140-duodecies of the Consumer Code provides that the statute of limitations and forfeitures for consumer rights which can be protected under the law implementing RAD is interrupted by the filing of the application initiating the Representative Action provided that the application is served on the defendant within the time limit set by the court, shall apply to actions seeking compensatory measures relating to infringements occurring on or after 25 June 2023.

The law implementing RAD applies the same mechanism adopted for the Class Action. As a result, claims are permitted on an opt-in basis.

Specifically, with the judgment granting the application for compensatory measures, the judge shall appoint the delegated judge for the opt-in procedure. Consumers are entitled to opt-in after the decision on the admissibility of the action or even after the judgment granting the request for compensatory measures. In both cases, the opt-in must take place within the time limit set by the judge, between 60 and 150 days from the publication of the order or judgment.

The delegated judge shall examine, with the aid of a professional appointed for such purpose, the application of each consumer who wishes to join the representative action.

Domestic and cross-border Representative Actions can only be brought by qualified entities, even without being previously mandated by consumers. Unlike the current regime for Class Actions, consumers are not entitled to bring domestic or cross-border Representative Actions on their own.

Domestic Representative Actions can be brought by:

• nationally representative consumers and users associations (included in the special list established by the Ministry of Business and Made in Italy);
• national independent public bodies designated as responsible for the enforcement of EU rules on the protection of consumer interests (including the Italian Antitrust Authority, the Italian Privacy Authority and the Ministry for Business and Made in Italy). From June 25, 2023, onwards, Italian public bodies entrusted to take public enforcement measures will be also entitled to start collective actions for the private enforcement of the administrative measures taken, or for the fine imposed in relation to EU law infringements affecting the collective interests of consumers;
• public and private entities representing the interests of consumers in another Member State (included in the special list drafted and published by the European Commission).

National bodies or associations of consumers or users wishing to bring cross-border Representative Actions must fulfill the requirements provided for by Art. 140-quinquies of the Consumer Code. Amongst all, they must prove they have adopted by-laws providing for rules:

• ensuring the body/association’s independence from any person other than consumers (and from entities with an economic interest in bringing the Representative Action or third parties funding the litigation); and
• preventing and solving conflicts of interest that may arise between the body/association, the third-party funding the litigation and the interests of consumers.

The Consumer Code just provides that Representative Actions are aimed at protecting the collective interests of consumers, defined as the interests of a number of consumers who have been or could be harmed by an infringement of the provisions set out in Annex II-septies to the Consumer Code (see section 1 above).

The application is declared inadmissible:

• if it is manifestly groundless;
• if it lacks the necessary elements to identify the group of consumers concerned by the Representative Action;
• if the court fails to find the homogeneity of the individual rights for which the relief is sought;
• if, also against an objection of the defendant, it appears that the claimant is lacking the necessary requirements for its standing to sue;
• if the action is brought in a conflict of interests (see "Third-party litigation funding, section 2");
• if the purpose of the qualified entity bringing the action does not justify the bringing of the action.

The order deciding on inadmissibility can be challenged. In any case, when inadmissibility is declared, the claimant may re-introduce the Representative Action where there has been a change of circumstances or where new facts or new factual or legal grounds are raised.

Although there is still no specific legislation at a national level, third-party litigation funding was for the very first time mentioned by Italian law with the law implementing RAD.

In line with RAD, qualified entities are required to disclose whether and to what extent the Representative Action they are commencing is funded by third parties and the Representative Action can be declared inadmissible if the funder is a competitor of or is linked to the defendant.

The qualified entity and the professional appointed to aid the judge to assess the compensatory claims of opting-in consumers (see "Opt-in vs opt-out", section 3) may, spontaneously or at the invitation of the Court and until the oral discussion of the case, reach a settlement agreement.

The court shall verify that the settlement agreement does not conflict with mandatory rules and does not contain unenforceable clauses or obligations taking into account the rights and interests of all parties and, in particular, those of the consumers.

The consumers potentially involved in the settlement agreement remain free not to accept it (Art. 140-decies of the Consumer Code).

The qualified entities must indicate on their website the Representative Actions they have decided to bring, the progress of those brought and their outcomes, and shall communicate the same information to the Ministry of Business and Made in Italy, which shall publish it on its institutional website (Art. 140-undecies of the Consumer Code).

Like in Class Actions, but unlike any other ordinary proceedings except for antitrust private enforcement cases, upon the claimant’s request, the court may order the defendant to submit evidence in its possession regarding the claim. In this respect, the court must specifically identify the evidence or the categories of evidence that are subject to disclosure. If such evidence consists of confidential information or documentary evidence, the court may adopt specific measures to protect confidentiality, which may include the non-disclosure obligation, the ability to redact the confidential information contained in a document, the possibility to have a closed hearing, and/or limit those permitted to access the documents.

The defendant not complying with the court’s order of disclosure may be subject to a fine of between EUR 10,000 and 100,000. In addition, if the defendant unreasonably refuses to disclose the evidence requested by the judge, the court may regard the fact that the disclosure order was aimed to prove as definitively proved.

Art. 140-quinquies of the Consumer Code provides that entities and associations which are qualified to bring Representative Actions in Italy may be registered in a special section of the relevant list regarding entities qualified to bring cross-border actions provided that they meet the following requirements:

• having been established, by public deed or by notarized private deed, and having demonstrated effective public activity for the protection of consumers' interests in the twelve months preceding the request for registration;
• possession of articles of association that provide for the protection of consumers, in the matters, referred to in Annex II-septies to the Consumer Code (see "Representative Action Mechanisms", section 5), and that are no-profit;
• not being subject to insolvency proceedings;
• provision in the by-laws of rules - including those concerning grounds of incompatibility relating to legal representatives - suitable to ensure the association's independence and the absence of influence from persons other than consumers and in particular from professionals who have an economic interest in bringing Representative Actions, as well as measures to prevent and resolve conflicts of interest that might arise between the association, its financial funders and consumers' interests;
• providing, among others, for the appointment of a supervisory body, which monitors compliance with the principles of independence and the measures to prevent and resolve conflicts of interest;
• make public on its website and by any other appropriate means its articles of association and a concise description of its activities, including information on its incorporation, its corporate purpose, the activity actually carried out to protect the interests of consumers, the non-existence of insolvency proceedings opened against it, its independence, as well as information on its sources of funding.

National independent public bodies (see "Qualified Entities", bullet 2) may also be designated as entities entitled to bring cross-border Representative Actions if they apply to be so entitled.

The Ministry of Business and Made in Italy shall issue a decree establishing the procedures by which the special section referred to in paragraph 1 shall be made public, as well as the procedures for submitting the application for registration and the appropriate documentation to certify that the applicant bodies and associations possess the requirements referred to in "Cross-Border Actions", section 1.

The law implementing RAD does not provide for rules on the destination of outstanding redress funds.

None at this time.