A European View on Litigation Funding

Litigation funding has emerged as a significant force within European legal systems, recognized by international courts and media for its role in facilitating access to justice for high-value claims. Despite its positive impact, the industry faces considerable uncertainty due to ongoing public debate, evolving regulatory landscapes, and economic pressures. The future of litigation funding hinges on effectively balancing robust oversight with commercial viability and the needs of claimants.

The litigation funding market is experiencing significant developments that profoundly impact businesses, consumers, and the legal profession. These key shifts include:

• Emerging Trends:
  
  • Market concentration.
  • Growth of secondary markets.
  • Sectoral changes in funded claims.
  • The crucial role of funding in providing access to justice for consumers and small businesses.
• Jurisdictional Developments:
  
  • Notable case studies and developments across Europe, including the ramifications of the UK's PACCAR ruling.
  • Ongoing legislative reforms.
• Regulatory Landscape:
  
  • Key findings from the European Commission's 2025 mapping study.
  • The importance of balanced regulation and increased transparency.
  • Challenges facing the industry, such as economic pressures and extended case durations.
• Role in Collective Actions:
  
  • The essential function of litigation funding in collective actions, referencing high-profile cases.
  • The broader discussion on claimant recoveries and funder responsibilities.

Public debate surrounding the increasing role of litigation funding in collective proceedings has focused on its costs, funder responsibilities, and claimant benefits. This discussion, however, has overshadowed the significant and steadily growing, though often unnoticed, role litigation funding plays in commercial litigation and arbitration.

While no obvious problem necessitates regulation, clearer guidelines could offer legal certainty for all market participants. This would foster a healthy and sustainable litigation funding market, ensuring access to justice for claimants while mitigating potential excesses that concern some opponents.

Litigation funding is increasingly crucial in European legal systems, facilitating access to justice and supporting high-value claims. Nevertheless, the sector faces a volatile environment due to ongoing public debate, regulatory changes, and economic difficulties. The industry's future hinges on balancing regulatory oversight, commercial viability, and claimant interests. The next phase of European litigation funding will be shaped by intelligent regulations, greater transparency, and a maturing market.