Minister Habijan in Parliament: Key objective of the changes is to encourage sustainable consumption and strengthen citizens' rights in everyday commercial relations

Minister of Justice, Public Administration and Digital Transformation Damir Habijan presented to the Croatian Parliament legislative amendments strengthening consumer protection and introducing mechanisms against abusive lawsuits aimed at restricting freedom of speech

The amendments to the Civil Obligations Act are based on the need to transpose two European Union directives.

The first Directive regulates the liability for defective products, with a transposition deadline of 9 December, while the second provides for an extension of the liability period for a material defect, thus promoting the repair of goods, with a transposition deadline of 31 July this year.

The Minister recalled that the provision on liability for material defects was already amended on 1 January 2022, and the new supplements are aimed at achieving a high level of consumer protection and encouraging sustainable consumption as part of the green transition.

‘The purpose and objective is to encourage consumers, in situations where there are certain material defects on products, to choose the repair of goods’,  Minister Habijan said, pointing out that those who choose repair are expected to have their liability periods extended by additional 12 months.

The novelties include the obligation to inform consumers about the right to choose between repair and replacement and about the right to extension of the liability period.

The question of a ‘reasonable period of time’ for repair will be assessed on a case-by-case basis. Where temporary replacement goods are provided to the consumer, they may be refurbished or recycled, they shall be free of charge and the seller will continue to be required to carry out repairs within a reasonable period of time.

In view of the digital age, the law also further regulates intangible products such as software that constitute an integral part of goods. Furthermore, the ambiguities surrounding Article 294 concerning the strengthening of contracts lacking the prescribed form have been resolved.

‘With these amendments and the proposed wording, we are remove this doubt and clearly regulating this issue’, the Minister highlighted, clarifying that the convalidation now clearly also applies to contracts for which a notarial deed or a solemnized document is envisaged. Article 314 retains the rules on written power of attorney, but introduces a provision on digital power of attorney, which similarly applies to bank guarantees.

Proposal for the Act on the Protection of Persons Who Engage in Public Participation

The new law aims to protect against abusive court proceedings (SLAPPs) that threaten constitutionally guaranteed freedoms of opinion, expression and speech.

As the Minister clarified, the purpose of abusive court proceedings is not to exercise or protect a legitimate right or interest, but their basic intention is to prevent, restrict or sanction public participation.

Although precise statistics of such cases did not exist until now due to the lack of a clear definition, the Minister confirmed the existence of strategic lawsuits against public participation in Croatia.

Protection is provided to a wide range of people, including journalists, trade unionists, artists, researchers, civil society organisations, human rights defenders, publishers and whistle-blowers.

The characteristic of these proceedings is an imbalance of power, where plaintiffs use financial strength or influence to discourage the other party, which often harms the reputation and dignity of these persons. Although the European Directive concerns civil and commercial proceedings with a cross-border dimension, the Government has decided to extend its application.

‘We believe that extending the scope of the law to all cases, regardless of whether they have a cross-border element or not, so that it also applies to purely national procedures, is the correct and necessary approach’, the Minister said.

Protection mechanisms cover four categories: the possibility for the defendant to request the securing of the costs of the proceedings, early dismissal of a manifestly unfounded claim, the reimbursement of procedural costs for the successful party and the possibility of awarding compensation to victims up to 10% of the value of the subject-matter of the dispute, i.e. a maximum of 5,000 euros.

In addition to effective protection, the law allows for systematic monitoring of SLAPP proceedings, and the Ministry of Justice, Public Administration and Digital Transformation will submit statistical data to the European Commission for the purpose of further improvement of the legislative framework.

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