Why Class Action Arbitration Could Be Possible in Italy
A comparative analysis including common law legal systems suggests that class action arbitration is compatible with the Italian civil law system that presently doesn't have any provision on the subject. This is the main conclusion of Marcello Gaboardi, an Assistant Professor of Civil Procedure Law and Bankruptcy Law at Bocconi's Department of Legal Studies, in his New Ways of Protection of Collective Interests: The Italian Class Litigation and Arbitration Through a Comparative Analysis (forthcoming in Journal of Dispute Resolution).
Legal systems across the world have infused their procedural rules with a preference for representative litigation in order to reduce the costs of individual litigation. The process has been faster in the Anglo-American world and slower in Continental Europe, with Italy regulating the class action only in 2010. In 2019, though, class action's scope has been broadened, introducing new eligible cases and the possibility to join a class action also after a Court's ruling.
The fact that the Italian discipline (as the disciplines of most EU countries) has no provisions about class arbitration doesn't preclude its viability, according to Prof. Gaboardi, because, in any case, it would need the agreement of the parties and couldn't, thus, violate their rights. Indeed, class members can take part to the class arbitration as well as civil litigation by providing the court with a personal declaration that complies with the consensual basis of arbitration. They are called upon to sign a commercial agreement in which an arbitral clause is present and to become parties to the arbitration by declaring to adhere to the class proceedings.
In second place, procedural rules can't be a hurdle. Even if, in the Italian procedural tradition, the Court proceedings pit two well-determined parties one against the other, class action rules already depart from this traditional view. It's harder, but not impossible, to reconcile the undetermined or putative nature of class members in a class action with the fact that the parties of an arbitration must choose the arbitrator (or arbitral tribunal). Adhering to the class arbitration can be described as a useful means of sharing the arbitrators who are appointed by the class representative.
Against those arguing that a class action arbitration has no advantages compared to a simple class action, because it's more expensive that a civil litigation, Prof. Gaboardi replies that costs can be shared by the components of the class and clear benefits are the speed of the proceedings and the increased likelihood of settling the case. In American experience, large companies often impose arbitration clauses in consumer contracts in order to prevent consumers from bringing class lawsuits to national courts. Class actions make it more difficult for companies to defend themselves effectively against a large number of similar but different claims. Admitting class action arbitration, instead, would prevent the arbitration clause from being used as an unfair expedient to block the class litigation.
Prof. Gaboardi is optimistic about the chance to really introduce class action arbitration. «This is not an academic exercise», he says, «because the Italian law looks at the class action with favor, as confirmed by the recent reinforcement of that regulatory regime and the still sporadic, though not irrelevant, practice of the Italian class action».