Litigation in Finland

Overview of Litigation in Finland

Litigation in Finland is conducted through general courts or via arbitration, reflecting a robust legal framework grounded in material and procedural law. Material law outlines the rights and obligations of legal or natural persons, while procedural law dictates the processes for enforcing those rights. Importantly, procedural law governs how a dispute must be conducted, but it does not resolve the substantive outcome. Its purpose is to ensure that material law is applied correctly and fairly.

Legal Protections and Constitutional Rights

The Finnish Criminal Code (39/1889) prohibits self-help, emphasizing the state's role in safeguarding the rights of individuals and companies. According to Section 21.1 of the Constitution of Finland (731/1999):

"Everyone has the right to have their case dealt with properly and without undue delay by a competent court or authority, as well as to have decisions regarding their rights or obligations reviewed by an independent judicial body."

Finnish Procedural Legislation

The Code of Judicial Procedure (4/1734) contains the core procedural rules governing litigation in Finland. Certain procedural doctrines—such as Res Judicata (the finality of a judgment) and the prohibition of reformatio in peius (the appellant’s position cannot be worsened)—are applied even if not expressly codified.

The Criminal Procedure Act (689/1997) governs criminal proceedings but incorporates civil procedure principles. International rules such as the Brussels I Regulation (44/2001) and the Lugano Convention also influence how Finnish courts handle cross-border disputes.

General Courts in Finland

Under the Courts Act (673/2016), the general courts consist of:

• District Courts
• Court of Appeal
• The Supreme Court (highest instance)

Finland also has administrative courts, with the Supreme Administrative Court as the highest authority. Specialized courts — such as the Market Court, Labour Court, and Insurance Court — handle specific types of disputes. District courts include a chief judge, district judges, and, when applicable, lay judges. Military members may also participate in cases under their jurisdiction.

Arbitration in Finland | Alternative Dispute Resolution

The Finnish Arbitration Act (967/1992) provides the legal basis for arbitration in Finland. While not fully based on the UNCITRAL Model Law, the Act incorporates several of its principles. A government review on potential amendments is ongoing to broaden its scope.

Arbitration under the Finland Arbitration Institute (FAI) is widely used and respected, offering detailed procedural rules. Under Finnish law, an arbitration clause must be in written form — however, email correspondence typically satisfies this requirement. Only civil disputes can be referred to arbitration, and arbitration awards are final and binding.

Right to Appeal

The right to appeal is guaranteed by the Constitution, but it is not absolute. The Court of Appeal evaluates whether a case warrants an appeal permit. Appeals to the Supreme Court require a review permit, although direct appeals from district courts are possible in cases involving precedent, provided both parties agree.

Class Action in Finland

The Act on Class Action (444/2007) defines the framework for class actions in Finland. Its scope is narrow: typically only the Consumer Ombudsman may initiate a class action, and individual claims cannot be aggregated.

To qualify as a class action, the following conditions must be met:

1. Multiple claimants must have claims against the same defendant based on similar circumstances.
2. The case must be suitable for class-action handling considering the class size, claims, and evidence.
3. The class must be adequately defined.

Class actions are handled initially by the District Court of Helsinki. The Act includes provisions on litigation funding, prohibiting funders who have competing interests or dependencies on the defendant. Funders may not influence the plaintiff’s decisions in ways that would harm consumer interests, and courts may require full funding disclosure.

Conclusion

Litigation in Finland emphasises fairness, efficiency, and procedural safeguards. Whether pursuing traditional court litigation or business-focused arbitration, understanding the Finnish judicial and procedural framework is essential for achieving successful outcomes in disputes.

For more information on litigation and arbitration services, visit our Dispute Resolution & Arbitration practice or contact our specialists.

Disclaimer: This article is for informational purposes only.