1st ICAI 2020

International Conference on Automotive Industry 2020

Mladá Boleslav, Czech Republic

be perceived as a significant test not only of personal integrity of particular lawyers, but importantly also of the self-regulatory function of the legal profession. The effectiveness of the compensatory collective redress will largely depend on the lawyers’ remuneration schemes, especially in regard to fees determined by a share of the result of the case. Any new legislative initiative therefore has to employ the economic approach to the issue and primarily assess the applicability of existing remuneration restriction rules to the proposed new area of litigation (Klement, Neeman, 2004). The existing limitation of the attorney’s success fee is embodied in the Code of Conduct of the Bar. This internal norm of the Bar provides for the general requirement of proportionality with the recommended 25% cap on the success fee (Czech Bar Association, 2018). Possibilities of more explicit rules embodied in the generally binding norms will likely be examined during the future process of the ACP legislative implementation. The potential rise of collective proceedings in the automotive sector will most likely be followed by further specialisation of legal services in the Czech Republic. The scope and complexity of the issue will involve, on a larger scale, external experts not only in the field of technical expertise. Regarding the nature of the collective proceedings, the involvement of, for example, media experts and other professionals supporting the complex approach to the group litigation can be expected together with the split of the legal professions into pro-plaintiff and pro-defendant attorneys. The rise of specialised consumer protection lawyers’ services as well as the external defendant-oriented legal independent representations of especially global corporations in the automotive sector will follow foreign expertise and experience. The car-producers and other major automotive firms would also necessarily consider the establishment of specialised internal legal departments dealing specifically with the collective proceedings and its ‘prevention, cooperating mainly with the top management, external lawyers and media. The impacts of the upcoming legislative change may well alter the corporate culture (Piché, 2009). 4.1 Automotive as a vulnerable target There is no doubt that one of the main targeted segments of the upcoming European DRA legislation is the automotive industry. This fact is underlined in the wording of Explanatory Memorandum to the Proposal of the Directive by explicit reference to Dieselgate as a typical case in which “… victims of unfair commercial practices, such as misleading advertising by car manufacturers, will be able to obtain remedies collectively through representative action under this proposal.” (European Commission, 2019). The specific vulnerability of the automotive industry to group actions is based on factors of a different nature. The most critical of the following factors can be identified as: the global nature of the industry, financial power leading to potential cartel temptations, large international scale of customers, high value of the product, extreme competitiveness of the segment and consequent high reputation risks. In addition to that, use of products of the automotive industry entails the inherent danger of collision and potentially high value damages caused by the very nature of transport. In contrast 4. The emerging risks for the Czech automotive sector

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