No class action mechanism such as the American standard functions at present in Portugal. However, Portuguese law has long known the institution of the so-called citizen’s action (ação popular). Its roots date back to the 16th century (introduction of the prescriptions of Ordenações Manuelinas) while today this is guaranteed by Article 52 § 3 of the Constitution of the Portuguese Republic of 1976. It is used to protect collective interests in such areas as: public health, consumer protection, environment, quality of life and cultural heritage. On the statutory level the abovementioned institution is regulated in the Citizen’s Action Law No 83/95 (Direito de participação procedimental e de acção popular), moreover, it is supported by Article 26A of the Portuguese Code of Civil Procedure (Código de Processo Civil).
The citizen’s action allows for pursuing multiple individual claims within single proceedings insofar as they are of a homogeneous nature. However, the mechanism provided for in Portuguese law stands rather for their joint examination than a typical class action. There are no courts which would have an exclusive jurisdiction to examine the case, so administrative courts and civil courts have jurisdiction in such cases.
Citizen’s action may be brought by each citizen, as well as an association or foundation with a legal personality that is not engaged in economic activity and which in its articles of association expressly declares the protection of a given interest among its objectives.
The citizen’s action mechanism functioning in Portuguese law draws, to a certain extent, on the opt-out model. The judgement of the court as to the merits of the case is binding for those declaring their consent to be represented by the entity initiating the proceedings.
The citizen’s action is an universal instrument in objective terms (abovementioned categories of interests which it is intended to protect are of an exemplary nature, hence there are no sectorial exceptions).
Since the described mechanism constitutes a joint examination of individual claims rather than a typical class action, the provisions do not foresee any special certification procedure. The entity initiating the proceedings is not obligated to obtain a power of attorney from other interested parties or any other explicit authorization to act in a case.
There are also no requirements in terms of the minimum number of claims that can be heard in the citizen’s action mode. However, there is a principle that claims heard jointly must arise from the same or similar event and they must be interrelated.
Upon declaring the statement of claims admissible for hearing (although there is no specific criteria in this regard), the court uses the media to summon interested parties to declare, within a prescribed time limit, whether they consent or not to representation by the entity bringing the action, although one’s silence is considered consent. In fact, the judgement may even affect people who had no knowledge about the initiation of the proceedings, whereby in specific cases the court may decide to limit the circle of those bound by the settlement of the citizen’s action.
The judgement rendered in proceedings initiated by bringing a citizen’s action is published in the press. For this purpose the court choses two magazines which probably include content followed by persons with an interest in the case. The announcement is published at the expense of the losing party.
The institution of the citizen’s action may serve to receive both the awarding of a judgement and a different type of verdict of a constitutive or declarative nature (in accordance with the general principles provided for in Portuguese civil procedure).
Portuguese law does not permit so-called punitive damages.
The losing party is obligated to reimburse the winning party for court fees, however, with the exclusion of lawyers’ fees. In cases of a claimant’s (claimants’) total failure, the court may obligate the unsuccessful party to pay between 10% to 50% of the total costs, taking the economic situation as well as substantive and formal reasons for dismissing the claim or rejecting the statement of claims into consideration.
Contingency fees rendering the attorney’s fee dependent exclusively on success in the proceedings are not permitted. However, the outcome of the case may have an impact on the method of determining the fee amount.
In the field of citizen’s action the state provides consumer organisations with support, e.g. by exempting them from the costs of the proceedings. Portuguese law does not contain legislation on financing such proceedings by third parties (although such financing is acceptable).
A citizen’s action is seldom used in practice, mainly in cases related to public health, environment, quality of life, consumer protection, public heritage and the public domain, although the possibility of bringing a citizen’s action is not limited to these fields. A well-known example is the action brought forth by the Portuguese Consumer Protection Association (Associação Portuguesa para a Defesa do Consumidor) against a telecommunication enterprise regarding an “activation fee”. In 2003, the competent court found that these fees breached contracts between the operator and the consumers. Within the framework of compensation (beyond due damages) the entrepreneur guaranteed all potential claimants free phone calls for a certain period of time.
In recent years an increasing popularity of citizen’s action in cases connected with services related to financial instruments can be observed.
At the same time, a public debate concerning the introduction of new regulations in the scope of the collective pursuit of claims (especially in cases regarding consumer law) is ongoing in Portugal.