Litigation Funding Overview – EU

Introduction:

In an in-depth Q&A with Litigation Finance Insider, Dina Kovacevic interviews Erik Bomans, CEO of Deminor, to discuss the key trends shaping the EU litigation funding market in 2026. In this timely Q&A, Erik shares his perspective on regulatory developments, market dynamics, and how litigation funding in Europe is evolving as the ding approach rather than a one-size-fits-all model.

Q&A with Erik Bomans, CEO of Deminor Litigation Funding Trends Shaping the EU Litigation Funding Market in 2026

As Europe’s litigation funding market enters a more mature and contested phase, 2026 is shaping up as a year defined by regulatory pressure, judicial scrutiny, and a surge in high-stakes collective actions. From the rollout of the Representative Actions Directive to growing calls for EU-level rules on third-party funding, funders are operating in an environment that is both expanding rapidly and becoming more closely examined. Against that backdrop, we spoke with Erik Bomans, CEO of Deminor & ILFA Board Member, about the forces reshaping the European market, the rise of Big Tech litigation, emerging areas such as AI-related claims, and how funding strategies are evolving across courts and arbitration forums.

Regulatory alignment for third party funding 

Pressure is building for harmonised EU-level rules on third party litigation funding. From your vantage point, is regulatory convergence inevitable in 2026, or will fragmentation remain the defining feature of the European market? What are the practical risks of continued divergence for funders, claimants, and courts, and where do you see the strongest push for alignment coming from?

We do not expect the EU to take any initiative to subject litigation funding to regulation, at least not in the foreseeable future. The European Commission’s survey has shown clearly that a large majority of respondents do not consider there to be an issue that would justify the introduction of regulation. As a result, we expect litigation funding in Europe to remain subject to a relatively liberal regime.

The funding-related restrictions set out in the Representative Actions Directive (RAD), as transposed into national legislation, are generally reasonable. In a limited number of Member States, however, these restrictions go further than necessary (for example, Germany’s 10% fee cap), which is unfortunate. That said, their impact should not be overstated, as they apply only to certain types of collective actions. Commercial litigation, arbitration, and many other forms of collective actions remain unaffected, and together they represent by far the largest share of the overall litigation funding market.

Collective actions and the Representative Actions Directive 

Most EU member states have now transposed the Representative Actions Directive, and we are seeing a sharp increase in collective litigation. How has this changed the volume, structure, and economics of cases coming across Deminor’s desk?

Are certain jurisdictions emerging as early leaders in claimant activity under the new regime?

Collective actions are on the rise, and we do not believe that the introduction of the Representative Actions Directive (RAD) will have a material impact on this trend, whether positive or negative. The growth is instead driven by broader developments in the economy and regulation, as well as increasing awareness of collective action mechanisms and litigation funding among market participants, including consumer organisations, law firms, and SMEs.

At Deminor, we are seeing a growing number of collective actions across a wide range of areas, including big tech, product liability, data breaches, and environmental damage. Antitrust litigation has also experienced a particularly strong increase over recent years.

Transparency and disclosure 

Transparency and disclosure of funding arrangements continue to attract regulatory and judicial attention. How far do you expect courts and legislators to go on mandatory disclosure, and where should the line be drawn? From Deminor’s perspective, what disclosures genuinely improve fairness without undermining commercial viability?

Disclosure of the existence of funding and the funder’s identity is already common in many collective actions and in commercial arbitration across Europe. This practice is largely driven by the courts, and we expect it to become the standard across all types of claims. We view this form of disclosure positively, as it helps build trust in litigation funding among market participants on both sides.

By contrast, we strongly oppose any requirement to disclose the funding agreement itself (other than in opt-out collective actions, where this is already the case). Disclosure of funding terms would confer an undue advantage on the opposing party and is neither necessary nor desirable. To date, we do not see courts moving in that direction.

Scrutinising fairness in funding agreements 

Courts across Europe are increasingly scrutinising the fairness of funding agreements, particularly the proportion of damages allocated to funders. Do you see this as a healthy evolution? How is Deminor adapting its pricing and contract structures in response to this trend?

This has been the case for many years in collective consumer opt-out actions in jurisdictions such as the Netherlands, which has long-standing experience with these types of proceedings. This is clearly a trend, and we expect it to become the standard in opt-out collective actions. It should be noted that commercial litigation, arbitration, and opt-in collective actions are not affected by this.

We consider this level of judicial scrutiny to be justified, as beneficiaries in opt-out actions do not participate in negotiating the funding terms at the outset of the case. Some degree of court oversight is therefore appropriate. This approach is preferable to imposing statutory fee caps, as has been done in Germany. That said, it is important that courts adopt a pragmatic approach and take into account the high risks and investments involved, as well as the duration of proceedings and the inherent uncertainty surrounding budgets and outcomes in complex litigation.

Large scale collective actions 

Large scale collective actions against major technology companies are becoming a defining feature of the European litigation landscape. Why do you think these claims have become so prevalent, and do you expect this to continue? Is there a difference in how claims against companies like Google, Meta, and TikTok are evaluated and funded vs. traditional funding models?

Indeed, litigation against big tech companies has increased. This trend is largely driven by regulatory actions taken by antitrust authorities and other national regulators. We expect further claims to arise from the implementation of the Digital Markets Act, which imposes specific obligations on large online platforms.

Claims against big tech companies are assessed on the same basis as any other case. The threshold for a case to be accepted for funding is high, regardless of the type of action or the identity of the defendant.

Multi-jurisdictional and parallel proceedings

Litigation against Big Tech often involves parallel proceedings across multiple jurisdictions. How are funders managing coordination risk, adverse cost exposure, and strategic sequencing in these multi-forum battles? Does this push favour larger institutional funders over smaller players?

Actions are often pursued in parallel across different jurisdictions, sometimes funded by the same funder and sometimes by different funders. Where necessary and appropriate, the qualified entities bringing these actions will coordinate. We do not see this as an issue on the claimants’ side.

We observe both national and international funders becoming active in these cases, and this is exactly how the market should function.

The next generation of funding claims 

Looking ahead, where do you see the next generation of funded claims emerging in Europe? In particular, how real is the pipeline for claims linked to AI-induced harm, algorithmic bias, automated decision making, and misuse of data?

In the collective action space, copyright- and AI-related claims are expected to increase, alongside antitrust and product liability (including environmental) claims. We also see professional sports-related claims emerging as a new area of activity. In the investment field, we are likely to see more fraud-related cases, including but not limited to crypto-related claims, a trend that could intensify if and when the current bull market corrects.

At the same time, commercial litigation and arbitration claims supported by litigation funding continue to rise. This development is largely taking place under the radar, but it is accounting for an increasingly significant share of the European litigation funding market.

Judicial forum shopping 

Are you seeing signs of increased judicial forum shopping as claimants and funders seek jurisdictions perceived as more funding friendly or procedurally efficient? Which courts are gaining reputations, positive or negative, among litigants and funders?

Forum shopping has always existed, but at Deminor we approach it with caution. We prefer to bring cases in the most natural and appropriate jurisdiction. Historically, the UK, the Netherlands, and Germany have been the preferred jurisdictions. More recently, however, Spain and Italy have risen in reputation, particularly due to the way their courts have handled antitrust litigation.

Closing Remarks

Finally, how is the balance between litigation and arbitration evolving in Europe from a funding perspective? Is Deminor seeing growth in funded arbitration, including collective or mass arbitration, or does court-based collective redress remain the primary engine of growth in 2026?

Arbitration remains largely confined to commercial disputes and disputes based on investment treaties. We expect continued growth in the use of litigation funding in commercial arbitration, broadly in line with the growth seen in commercial litigation.

Interview date: January 2026

About Litigation Finance Insider:
Litigation Finance Insider is a leading online publication dedicated to the global litigation finance industry. It provides news, analysis and commentary on third party funding developments, market trends and key disputes across jurisdictions, serving as a trusted resource for practitioners, funders, corporates and investors.

About Dina Kovacevic:
Dina Kovacevic is the Founder and Editor of Litigation Finance Insider. She is a recognised commentator on the litigation finance market, covering industry developments, major funding matters and regulatory trends worldwide, and regularly engages with leading funders, law firms and market participants.