LEGISLATORS yesterday approved a $10 million fund to help consumers take collective legal action against unscrupulous traders. Aggrieved consumers could apply for the Consumer Legal Action Fund for cases that involved significant public interests or injustices which would affect a large group of people. Under proposed eligibility criteria for assistance, the Consumer Council must also be satisfied with the cost effectiveness of the action, the possibility of generating a positive financial return to the fund and the chances of success in the case. Vice-chairman of the council, legislator Anna Wu Hung-yuk, welcomed Legco's approval and said the fund would have a deterrent effect. She said the council would start checking files to see if there were any cases worth taking to court. Previously, most consumers did not pursue legitimate claims against unscrupulous traders through private litigation. This was because most did not know about available legal remedies and the relatively small amounts involved did not justify the cost of such litigation, she said. Only one-third of the unsettled cases that could have had grounds for legal action were pursued in the courts. Since the fund was self-financing, applicants would have to pay an administrative fee of $100 for Small Claims Tribunal cases and $1,000 for District Court cases. The council would not take up cases within the jurisdiction of the High Court and above in the first two years to allow time to accumulate experience. The council estimated the fund would support 25 Small Claims Tribunal cases and 10 District Court cases in the first year. It would receive 10 per cent of any damages awarded to the assisted consumers. As the trustee of the fund, the council would be responsible for investing to achieve a rate of return of about three to five per cent every year.