In Denmark, class action suits are specifically regulated in the Administration of Justice Act and in the Act on Access to Class Actions for the Protection of the Collective Interests of Consumers (Hereinafter referred to as: “The Implementation Act”).

In 2008, Danish legislation on class actions was introduced, although there were mechanisms in place enabling that multiple pending court cases to be processed jointly before that time too.

Today, class action suits are regulated in chapter 23a of the Administration of Justice Act. This entails that class action suits are a separate form of legal procedure in Danish law, and class actions suits are therefore lawsuits that can be processed under the rules of chapter 23a of the Administration of Justice Act. The legal procedure entails that several similar claims made by a group of individuals are processed during a joint trial by a group representative. The individuals in the group are not considered as parties in the trial. Chapter 23a of the Act consists of sections 254 a-k.

Subsequently, the legislation on class actions has been supplemented by EU Directive 2020/1828 on collective redress regime which aims to protect the collective interests of consumers. This Directive has been implemented within the Danish law in the Implementation Act, which came into force on 25 June, 2023. The Implementation Act pertains to class actions that arise from a traders breach of EU consumer protection regulations including commercials’ breach of the provisions set forth in Appendix I to the EU Directive 2020/1828, cf. section 1, subsection 1 of the Implementation Act. This encompasses a broad spectrum of applications, including for instance data protection rules, unfair consumer agreements and trade practices etc. Hence, the Implementation Act expands the possibility for consumers to bring class actions against traders by allowing cross-border class actions.

In principle, it should be noted that if a class action suit is covered by both acts, there is freedom of choice as to which of the Acts the class action suit is brought under.

In accordance with Danish legislation, a group representative must bring the class action suit to court and the group representative must be appointed, before the court will allow a class action suit to go forward. In Denmark, a group representative is usually a legal entity established with the sole purpose of pursuing a particular class action claim.

According to section 254 c, subsection 1, of the Administration of Justice Act, a group representative must be:

1. A regular member of the group
2. A private organisation, where the purpose of the suit falls within the purpose of the organisation; or
3. A public authority authorised by law to act as the group representative

With regard to point number 3, it should be noted that the Danish Consumer Ombudsman was the only public institution authorised by law to act as the group representative until the introduction of the Implementation Act. This Act strengthens consumer protection by allowing more organisations and authorities representing consumer interests to be authorised to bring new types of class actions against traders.

Furthermore, it must be noted that the group representative is not required to be appointed by the court in accordance with the Implementation Act. In addition, the authorities do not need to be empowered by law to act as group representatives since authorities as well as organisations can request approval from the Minister of Trade and Industry, cf. section 3, subsection 1, of the Implementation Act. The Competition and Consumer Authority submits a list of authorised representatives to the European Commission, who will publish the list, cf. section 4, subsection 1, of the Implementation Act. This entails that each EU Member State must respect the approvals of authorities and organisations granted by other Member States. This further entails that an approved organisation or authority in another Member State can take legal action against a trader in Denmark, cf. section 7 of the Implementation Act.

According to section 3, subsection 2 and 3, of the Implementation Act, several conditions must be met before an authorisation can take place. For instance, the organisation must be non-profit, independent as well as able to demonstrate 12 months of activity in the field of consumer protection.

If an authority or organisation no longer fulfil the conditions, the Minister of Trade and Industry may revoke its approval, cf. section 5, subsection 1, of the Implementation Act. The Minister of Trade and Industry assesses, at least every five years, whether the approved authorities and organisations continue to fulfil the conditions.

In Denmark, the civil courts deal with class action suits. The civil courts consist of the Supreme Court, the High Courts including the Maritime and Commercial High Court, the District Courts and the Danish Registration Court. This follows from section 1, subsection 1 and 2, of the Administration of Justice Act.

The types of conduct and causes of action that class action suits can be relied upon as the basis for such suits, are the same types of conduct and causes that all other civil court cases can be relied upon. For instance, the conduct can be based on a strict liability or a fault-based liability.

According to the rules in Chapter 23 a of the Administration of Justice Act, all types of civil cases can by brought as a class action.

However, in accordance with section 254 a, subsection 2, of the Administration of Justice Act, there are limitations on the types of claims that can be brought as class actions. The limitations are relating to cases concerning criminal law, family law, parental rights and responsibilities, civil imprisonment, guardianship, adoption, and cases which are tried before the United Patent Court.

In relation to the Implementation Act – and as mentioned in the above question 1 – these rules cover class actions concerning breaches by traders of the provisions in Appendix I to EU Directive 2020/1828, cf. section 1, subsection 1, of the Implementation Act. Appendix I contains 66 consumer-oriented provisions, e.g. on misleading advertising, consumer credit and package tours.

Unless otherwise provided in the Implementation Act, chapters 21-23 and 24-38 of the Administrative Procedure Act shall apply to the court’s handling of class actions covered by the Act, cf. section 1, subsection 2, of the Implementation Act.

Historically speaking, class action suits have not been brought very often in Denmark. This is primarily caused by the fact that the legislation on class action suits was first introduced in 2008. It was also due to strict requirements for bringing class action, such as the requirement to provide security for legal costs to a class action suit.

In the period from 2008 to 2023, 74 class actions suits were brought at the Danish District Courts, and 64 of those have been settled. This indicates that the number of claims have increased in recent years.

As a result of the EU Directive 2020/1828, it is expected that more cases will be brought as class actions in the future. This is partly because the Implementation Act makes it much easier for consumers to bring national class actions because of the expansion of the basis for representative actions for redress, and partly because of the option to apply the two different sets of rules under the Administration of Justice Act and the rules under the Implementation Act. This is also because of the possibility of third-party funding. Furthermore, this is also due to the fact that it is much easier for consumers from different EU Member States to bring cross-border class actions in Denmark and/or in other EU Member States. These expectations do not just apply in Denmark, but within the entire EU.

With regard to the developments of Danish class actions, there has been a recent increase in the use of the system, in particular with respect to securities claims. As a result, the risk of being met with a security class action has increased. There are a few examples from Danish case law that illustrates this development:

The OW Bunker case from the High Court is one of them. In this case, a number of small investors opted-in on a class action to sue the former executive board for misrepresentation and non-disclosure in a prospectus published prior to the listing of OW Bunker. The company went into bankruptcy less than a year after the listing. The class action was accepted as the High Court deemed that a class action suit was the best way to deal with the claims.

The class action suit against the healthcare company Novo Nordisk is another case that illustrates the trend of securities claims. This class action suit was filed by a number of shareholders claiming that Novo Nordisk had given a misleading statement and did not make appropriate disclosures regarding its sales of insulin products in the US. The original claim was for a total amount of around DKK 11 billion. The suit was settled in the beginning of 2022. The settlement contained no admission of liability, wrongdoing or responsibility by Novo Nordisk.

The case of Danske Bank also exemplifies the trend of securities claims. In this case there were several class action suits, and among these suits were one where 300 investors sued the bank because their shares lost value due to the bank’s money-laundering practices.

Additionally, some of the latest developments are that it now seems that the Danish class actions rules are beginning to have wider use and that more cases, not involving securities claims, are brought using the class action system.

An example is the class action suit against the Danish Ministry of Taxation and the Danish Broadcasting Corporation (DR). In this case, a group of licence fee payers claimed repayment of licence VAT which – allegedly – had been collected illegally. The class action suit, which is an opt-in suit, has been allowed by the court to go forward and the group has been provided free legal aid from the Danish Government. The status of the case is that the Court of Justice of the European Union in March 2024 discussed a number of issues and on 12 September 2024, the Advocate-Generals of the Court of Justice of the European Union are expected to give a legal opinion in the case. The Court of Justice of the European Union will then deliver a judgment. The case will be referred to the Danish Eastern High Court for the final decision.

Finally, the wider use of the class action system might develop even further and constitute a risk in the coming years seeing that class action suits, for instance regarding climate change and the covid-19 pandemic, are likely to appear. Further contributing to the wider use of the class action system is that more Danish law firms have begun to consider class action suits as a business area with potential.

Both opt in and opt out class action suits are allowed under Danish legislation.

In accordance with the Administration of Justice Act, the court decides whether a specific class action suit should be opt in or opt out. However, the opt in-model is the starting point, but if the court finds the opt out-model more beneficial to a specific class action suit, the opt out-model will be used as a narrow exception.

If the class action suit is based on an opt out-model, the group representative must be a public organisation. In this case, the court will set a deadline within which potential group members must opt out of the suit, cf. section 254 e, subsection 8, of the Administration of Justice Act.

If the class action suit is based on an opt in-model, it is binding for a group member to opt in to the suit. Therefore, any potential group members must be informed of the legal impacts of opting in to a certain class action suit. The effect of this is that group members cannot bring individual lawsuits in respect of their claims within the scope of the class action. The group members must be aware that the opt in must take place before a certain deadline, cf. section 254 e, subsection 6, of the Administration of Justice Act, and section 16, subsection 2, of the Implementation Act. Furthermore, according to the Implementation Act, consumers can also opt in to class actions brought in other Member States if they are affected by the class action.

In relation to the Implementation Act, class actions suits can be brought with a claim for either, cf. section 11, subsection 2:

1. Interim injunction or prohibitory injunction
2. Mandatory injunction or prohibitory injunction or redress

If the class action concerns interim, prohibitory or mandatory injunction, it is not a condition for a decision to be made that the consumers have actually opted in to the suit, cf. section 13, subsection 3, of the Implementation Act. If the class action concerns redress, the suit can only be based on an opt in-model, cf. section 16, subsection 1, of the Implementation Act.

In addition, it follows from section 254 e, subsection 7, of the Administration of Justice Act that the court can decide that opting in is conditional on the group members providing security for legal costs of the case if the court passes judgment in favour of the defendant. The amount of the security is determined by the court and if the group loses the case, the liability of the group members is limited to this amount, cf. section 254 f, subsection 3, of the Administration of Justice Act. This applies unless the member of the class action for instance has legal aid insurance or fulfils the terms for free legal aid (see the below question 21).

On the contrary, in opt out suits, the court cannot require the group members to provide security for the legal costs of the case.

With regard to the requirement for security for legal costs, the Danish Supreme Court lowered the security for such legal costs in its decision in UfR.2012.2938H. The court stated that the amount of the security must be determined at the discretion of the court, taking into account the value, scope and nature of the case and the work involved.

However, the requirement to provide security for legal costs may be waived for individual group members. This presupposes that the group members have legal expenses insurance, or other insurance covering the costs of the case, or that the class action meets the conditions for obtaining free legal aid. In this regard, it should be noted that the group representative can apply for free legal aid on behalf of the group, which means that the group members themselves cannot apply for free legal aid.

The procedure for bringing a class action suit to court is identical to any other court case, so a class action suit begins with the submission of a Statement of Claim, see section 348, cf. section 254 d, subsection 1, of the Administration of Justice Act. The only difference in class action suits is that the claimant, in its Statement of Claim, must request that the court will process the claim in accordance with the rules of class actions.

In addition to the request, it follows from section 254 d, subsection 1, of the Administration of Justice Act, that the Statement of Claim must contain:

1. A description of the group
2. Information about how the members of the group can be identified and informed about the suit; and
3. A suggestion as to who can and wants to be a group representative

If the Statement of Claim fails to fulfil these requirements of section 254 d, subsection 1, it is unsuitable to serve as a basis for the proceedings and the court will dismiss the case. Before the court dismisses the case, the court can, however, grant the claimant a deadline before which the claimant has to remedy the defects of the Statement of Claim, cf. section 348, subsection 2, of the Administration of Justice Act.

Furthermore, if the class action is brought under the Implementation Act, the Statement of Claim must contain the following in addition to the requirements under section 348 of the Administrative Justice Act, see section 11 of the Implementation Act:

1. A statement that the case is brought according to the rules of this Act
2. Information about the consumers who are affected by the class action suit
3. Any other information necessary to enable the court to determine whether it has jurisdiction and to choose the applicable law

Procedurally, once the group has been identified, there is no difference between bringing forth a normal court case and bringing forth a class action suit. The Statement of Claim will be served to the class actions group’s opponent and if the opponent objects to the case being brought as a class action, the court will have to decide whether the case can be brought as a class action before the case can proceed.

A class action suit is required to meet the criteria set out in section 254 b, subsection 1, of the Administration of Justice Act, before the court will allow the suit to go forward:

1. The claims must be similar in essence
2. The legal venue for all claims must be in Denmark
3. The court must have jurisdiction over at least one of the claims
4. The court must have subject-matter jurisdiction regarding one of the claims
5. Class action must be the best processual option
6. The group members can be identified and are notified about the class action suit
7. A group representative can be appointed

In accordance with section 12 of the Implementation Act, the following criteria must be met in order for class actions suits to be brought:

1. The claims must be similar in essence
2. Class action must be the best processual option
3. The group members can be identified and are notified about the class action suit

These criteria implements Article 7(4) of EU Directive 2020/1828. However, the criteria in section 12 partially corresponds to the criteria in section 254 b, subsection 1, of the Administration of Justice Act and section 12 must be interpreted in accordance with the corresponding criteria in the Administration of Justice Act.

These criteria are relatively strict. The criterion that a class action suit must be the best processual option to address a certain claim entails that the court will only issue a group certificate if no other option for addressing the claim is better suited. Therefore, this criterion is the most difficult to fulfil.

If the court does not allow the class action suit to go forward, the group members of the suit must bring their claims individually.

This was the case in the decision UfR 2018.3361 Ø, in which the association “Class Action against AP Pension” brought a case as a class action against the insurer AP Pension Livsforsikringsselskab. The High Court dismissed the class action as the conditions in section 254 b, subsection 1, (1) and (5), were not met. The High Court took into account that the class action was not sufficiently similar in essence as the class action group included both working and retired individuals, and the same factual circumstances were not present for the individual members.

The remedies available to claimants in class action suits are the same as in any other civil court case. The remedies can therefore be declaratory remedies, damages or restitution.

According to section 15, subsection 1, of the Implementation Act, in connection with a class action for redress, the court may decide that the trader must give the registered consumers access to certain remedies. Depending on the circumstances, these remedies may include:

1. Compensation
2. Remedy
3. Replacement
4. Pro rata reduction
5. Termination
6. Reimbursement

However, these remedies must be held up against section 338 of the Administration of Justice Act, according to which it appears that the court cannot grand consumers more than the approved authority or organisation have claimed.

Neither punitive nor exemplary damages are generally available for class actions under Danish law.

However, it should be noted that a fine may be imposed on any individual who intentionally contravenes an injunction or prohibition, cf. section 23, subsection 1, of the Implementation Act. Furthermore, in accordance with section 23, subsection 4, of the Implementation Act, criminal liability is imposed on companies, including legal persons, under the rules in Chapter 5 of the Danish Criminal Code.

In general, a civil trial is heard by one judge. In some cases a trial can, however, be handled by three judges, for instance if the case is of fundamental importance. These principles follows from section 12, subsections 1 and 3, of the Administration of Justice Act.

Specialist judges can be appointed as assessors in special circumstances. This is especially in cases concerning maritime law, cf. section 20, subsection 1 of the Administration of Justice Act.

The measure of the damages for class actions is based on the actual losses suffered by the group members of the class action, who are entitled to recover the full and actual losses suffered by each of them, as long as this can be proved during the proceedings. The claimant carries the burden of proof for the actual loss suffered.

For instance, in a class action suit against a pharmaceutical company, for selling defective drugs, damages may be calculated on the basis of the cost of purchasing the drugs and the additional medical expenses incurred due to the use of the drugs.

With regard to jurisdictional obstacles to class actions in Denmark, international claimants can participate in class actions in Denmark as the class action system is not limited to Danish citizens only, but certain requirements outlined in section 254 b, subsection 1, of the Administration of Justice Act, and section 12 of the Implementation Act, must be met.

In particular, the conditions set out in section 254 b, subsection 2, in the Administration of Justice Act, and in section 7, subsection 1, and section 8, subsection 1, of the Implementation Act are important in this regard. These conditions state that the legal venue for all claims included in the class action must be in Denmark.

Therefore, despite the possibility for international claimants to participate, the requirement for the legal venue to be in Denmark presents a jurisdictional obstacle to the proceedings.

Please see the answer to question 14.

The rules regarding class actions currently in force in Chapter 23 a of the Administration of Justice Act are not directly based on or impacted by international laws.

However, the EU directive 2020/1828 has had an impact on the conduct of class actions in Denmark regarding third-party funding as well as the expansion of the basis for representative actions for redress. However, it should be noted that the impact has not been significant, seeing that Danish legislation already shares many similarities with the Directive. According to the Administration of Justice Act, consumers already had several options to pursue a claim against a trader through a class action.

The group representative does not have the authority to independently settle the claims of the group members, neither in court nor out-of-court. In accordance with section 254 h of the Administration of Justice Act, the group representative cannot enter into a settlement regarding claims included in the class action suit before the court has approved the settlement. The court will approve the settlement unless the settlement discriminates against the members of the class action or the settlement is obviously unfair.

In accordance with section 19 of the Implementation Act, the approved authority or organisation, together with the trader, may submit to the court a proposal for a settlement of the claim for the benefit of the registered consumers. In addition, the court may – at any time during the proceedings – invite the parties to enter into a settlement for redress. A settlement must be approved by the court. If the court approves the settlement, it becomes binding for the parties in the case and the registered consumers.

Beyond these rules, the general rules on settlement of civil cases applies to class action suits.

Additionally, there are several out-of-court dispute resolutions available before litigation. These mechanisms are not available for class actions, but the mechanisms seek to settle a high number of small individual claims before they develop into a court case. The Consumer Ombudsman may take the question to court on behalf of the consumer or group of consumers if the defendant does not comply with the alternative dispute resolution ruling.

Please see the answer to question 17.

The class action suits that we have seen in public in Denmark so far are often between a group of individuals, often consumers, as claimants against a non-governmental company and/or directors of this company as defendants. In these class action suits the group often claims compensation from the company and/or directors often on the basis of either a strict or fault-based liability.

Therefore, in Denmark, the public has not really seen how class actions typically interact with regulatory enforcement findings.

There is a growing global trend towards ESG matters. Claims related to corporate misconduct concerning sustainability practices, violations of labour rights or issues of diversity and inclusion may potentially be brought under Danish law on class action suits.

In March 2024, the Danish Western High Court ruled in what has been described as the first greenwashing-claim in Denmark. The case was brought before the High Court by two associations against one of the largest meat producers in the EU. Based on this as well as on the global trend in using class actions on ESG related issues lead to the expectation, that more class actions in this area will start to emerge in Denmark, as well as in the EU.

In 2017, the Danish Supreme Court permitted the use of third party-funding on a group level. Since then, this funding method has been used in particular by shareholders and other investors in especially large damages suits and in bankruptcy cases against large companies and executive boards which have experienced a sudden fall in the value of their shares.

This happened when OW Bunker’s bankrupt estate entered into an agreement with a third-party funder. The Supreme Court found that third-party funding was not in conflict with the Danish legal procedure.

Consequently, third-party funding is permitted under Danish law, and there is absolute freedom of contract regarding third-party funding, as long as the governing contract for the third-party funder lives up to the general requirements for contracts in Danish law.

On 25 June 2023, third-party funding for approved organisations was governed by legislation as a result of the implementation of the EU Directive 2020/1828, cf. section 17, subsection 1, of the Implementation Act. However, third-party funding is only allowed in class actions regarding redress. Third-party funding is therefore not available for class actions regarding injunctions or prohibitions. Furthermore, it is not possible for approved authorities to be funded by a third-party in connection with a class action for redress. This is due to that authorities must be independent, including having to be independent of any third parties’ financial interests.

However, approved organisations cannot be funded by a third-party in connection with a class action for redress if a conflict of interest arises or if there is an obvious risk of this.

Besides third-party funding, a class action suit can be funded by other methods available to the individual group members, including coverage by legal expenses insurance and by legal aid:

Regarding legal expenses insurance, if a group member of a class action suit is covered by such an insurance, the group member might be able to obtain insurance cover for the expenses related to participating in the class action suit.

In relation to legal aid, the Danish government can provide free legal aid and thereby accept to cover an individual’s expenses in connection with a lawsuit if certain conditions are met. This follows from the sections 325-329 of the Administration of Justice Act.

The government will provide such free legal aid if either the individual or the case qualifies for the aid:

A person can qualify for legal aid if their income is below the appointed minimum appearing from sections 325 and 326 of the Administration of Justice Act. The income limits are regulated annually. The income limit in 2024 for individuals, who are not married and are living alone, are DKK 371,000 (app. £42,500/€49,700) and for married individuals/individuals living in marriage-like relationships the limit is DKK 471,000 (app. £53,900/€63,100). For each child living in the household below the age of 18, the income limit will be raised with DKK 64,000 (app. £7,300/€8,600).

The case has to either fall within the types of cases listed in section 327 of the Administration of Justice Act or be of such nature that it is essential for the applicant to take it to court, cf. section 328 of the Administration of Justice Act in question.

Free legal aid can also be provided by the Minister of Justice if the case is of benefit to society or will have such an impact on the applicant that it is necessary that legal aid is provided, cf. section 329 of the Administration of Justice Act, or if legal action is taken by a consumer who has been successful in an action before the Consumers Complaints Board or in certain taxation cases.

The rules regarding legal aid are secondary to a private legal expenses insurance. The Government will not provide free legal aid to a person whose expenses in a lawsuit are covered by such an insurance.

Under Danish law, no specific rules exists in relation to whether contingency fee arrangements can be used to fund class action suits.

However, there are rules for lawyers in this regard as lawyers may only enter into result based fee agreements if certain conditions are met, cf. the Code of Legal Ethics.

The presiding court decides who, if anyone, should pay the costs of the case. This follows from the general rules regarding legal costs in civil cases in sections 311-322 of the Administration of Justice Act.

Since the ‘loser shall pay’-principle also applies to class action suits, the court can make an ‘adverse costs’ order against the unsuccessful party of a class action suit.

If the court decides in favour of the defendant, the group representative and the members of the group are jointly and severally liable. In the interrelationship among the group representative and the group members, the group members will carry the costs of the defendant to the extent of their liability.

According to section 18, subsection 1, of the Implementation Act, registered consumers in a class action suit regarding redress cannot be ordered to pay legal costs. However, in extraordinary circumstances, the court may order registered consumers in a class action suit regarding redress to pay the legal costs incurred as a result of the intentional or negligent conduct of the registered consumer. Section 18, subsection 3 of the Implementation Act states that the losing party must reimburse the other party for the costs incurred in complying with the notification obligation.

There have been no new proposals for the reform of class actions since the implementation of the Directive.