European Justice Forum

Antitrust enforcement: Competition Damages

On this page:

1. Background
2. Current developments
3. Competition Damages

Background

For over 10 years DG COMP has followed a policy of trying to introduce EU collective litigation as a means of recovering damages for loss caused by infringement of competition rules.

EJF has fought strongly against this policy and our advocacy in Brussels and with Member States was one of the main reasons why in 2009 the Commission rejected a proposal Directive on Competition damages.

Under the current Barroso Presidency a new consultation has been launched on collective redress. Any further COMP proposals must account the outcome of this consultation.

Competition law enforcement in Europe (both on the national level and on the EU level) has traditionally been entrusted to public authorities,but DG COMP has direct enforcement powers with regard to breaches of EU competition rules. DG COMP has long sought to increase those powers by introducing "class action" to be brought by the one to claiming to have suffered loss as a result of breach of EU competition rules. COMP claims that such a litigation would promote an additional deterrent to infringement and that it would improve the reovery of such damages by victims of competition infringement.

DG COMP’s 2008 White Paper received great many responses, and the Parliament adopted a Resolution on Competition Damages in March 2009. This resolution was contained in the Report of the Economic and Monetary Affairs Committee (rapporteur MEP Lehne) which expressed strong reservations about any measure relying on collective litigation. It called for a consistent EU policy to avoid inconsistency between different initiatives by different Directorates General (at the time - 2009- DG SANCO was separately discussing the possibility of using collective litigation to improve consumer redress). Parliament also insisted on a co-decision process with regard to any measure on competition damages. EJF engaged colsely with Parliament on this issue and a number of MEPs put forward announcements to the ECON report based on EJF suggestions. In the event, immediately Herr Lehne's report was issued in March 2009, DG COMP put a draft directive into the internal Commission decision making process. The directive relied entirely citizens using collective litigation to recover damages for breach of EU competition rules.

There was strong reaction against this proposal from the European Parliament, from the member states, and from industry bodies including EJF. We saw this proposal as retrograde and lacking any substantive safeguard to avoid abusive litigation. 

EJF therefore strongly opposed the proposal, and we were pleased that Commission decided not to push the proposal directive ahead.

Current developments

Following the rejection in 2009 of COMP's proposal Directive, in his new administration, President Barroso asked DG Justice to lead a new tripartite consultations with DG SANCO and DG COMP into the whole issue of collective redress. The aim was to agree what policy the Commission should adopt on this matter and (if that policy included collective litigation) to set out over arching principles and guidelines to which any collective litigation proposal had to conform.

EJF made a detailed response to this consultation arguing against any measure of EU collective litigation (click here).

Vice President Reding (JUST) is known to be reluctant to see any EU measure on collective litigation. She restated her position in July 2012.

Vice President Almunia (COMP) is known to want collective litigation in the field of competition damages. He also restated his position in July 2011.

Commissioner Dali would probably like a "big stick' of collective litigation, but his Directorate is focused on ADR rather than collective litigation.

As a consequence, it is not yet clear whether the Commission will adopt a policy allowing EU collective litigation measures, In any event, DG COMP cannot put such a policy forward until the results of tripartite consultation are published (Communication expected December 2010) and unless the reult is for the Commission to allow such measure at least in the field of competitive damage.

Competition damages

DG COMP has published draft guidelines on the calculation of competition damages (17 June 2011). EJF has circulated this paper to members. " Quantifying antitrust damages towards non-biding guidance for courts" (http://ec.europa.eu/competition/antitrust/actionsdamages/). This study gives an overview of current practices and proposes a toolkit for calculating damages.

EJF has requested member comments and will respond to DG COMP's paper in September.

Please consult also our Glossary