On 21 March 2025 the European Commission published a comprehensive report on third party litigation funding (TPLF) across the EU. This ‘mapping study’ was undertaken to assist the Commission in following up on the 2022 resolution of the European Parliament (EP) which called for responsible funding of litigation (and included a draft directive as an annex). As the resolution was driven by German MEP Axel Voss it is often referred to as the ‘Voss report’.

The timing is interesting in that the new report (which runs to more than seven hundred pages) comes only a few months after something of a parallel study published late last year by the European Law Institute (ELI), but it also emerges very shortly after the consultative phase of the Civil Justice Council’s review of TPLF in England & Wales closed (on 3 March 2025). Whether in the EU or here, concerns about transparency and disclosure, financial regulation (rules on capital adequacy, for example), and consumer protection (including avoiding conflicts of interest) are emerging as key issues that must be addressed in any decisions about the appropriate regulatory model for TPLF. 

In our response to the CJC review, we noted that “stakeholders have published or commissioned various reports which offer their own particular perspectives. Some of these are all too easily characterised as highly polarised, such as reports released in 2024 by BEUC (The European Consumer Organisation), by the Adam Smith Institute and by business groups, including the European Justice Forum.” This polarity and divergence among stakeholder views also features in the report of the mapping study, which found that:

“While stakeholders (especially from the business side) were partly in favour of a comprehensive regulation of TPLF in line with the draft directive annexed to the EP resolution, others, including minorities of consumer organisations and litigation funders, were in favour of a ‘balanced’ or ‘light touch’ regulation of TPLF, which would provide basic, not too specific rules, but be careful to keep TPLF a viable option.”

The new report summarises what are now appearing to be the three main regulatory approaches that national governments and regulators might adopt, these being:

  • no regulation
  • ‘light touch’ regulation
  • strong regulation

At the risk of reducing these to trite descriptions, they might be loosely paraphrased as: do nothing, do something dramatic, or do something in between. It does not seem unrealistic to imagine that the CJC’s advice to the UK government later in the year - it is expected in the summer - might be structured around the same range of options. 

It may be worth recalling that the 2024 ELI report favoured the middle option, i.e. ‘light touch’ regulation, by proposing key principles rather than a strict ‘black and white’ law approach. In what may be a subconscious echo of the ELI’s approach, the authors of the mapping study report point out that:

“A considerable number of national experts and stakeholders are in favour of a ‘balanced’ or ‘light touch’ regulation of TPLF, which would provide basic, not too specific rules, but be careful to keep TPLF a viable option …  A balance must be struck [in order to] facilitate access to justice, help monitor TPLF activities, while preventing abuse, and maintain fairness in legal proceedings.”

A slight majority (58%) of those who responded to the mapping study were in favour of regulation and 29% argued for no regulation, with the remainder not knowing or not addressing the question. 

Obviously, it does not follow from this breakdown of responses that the Commission will seek to bring forward regulation (whether light touch or strong), even less so that the CJC might make recommendations here in favour of regulation. What is, and will remain, significant is that there is a lively debate in both the EU and in England & Wales, and that it is exploring remarkably similar themes and topics along broadly similar timescales.

We will be closely monitoring how this important and fascinating debate develops and please feel free to contact us if you would like to explore the issues aired in this article, and their implications, in more detail.