After France’s adoption of class actions, it is the European Union’s turn to promote actions for damages for victims of anti-competitive practices (cartels and abuses of dominant position). The draft Directive governing actions for damages before national courts for infringements of the competition law provisions of the Members States and of the European Union was approved on April 17, 2014 by the European Parliament. The approval by the Council of the European Union, without any modification to the Parliament’s position, will close the legislative procedure at European level. The Member States will then have two years to transpose its provisions in their national legal system.
It is recalled that two types of procedures exist for anti-competitive practices: (i) public enforcement by the Commission and national competition authorities to sanction the authors of such practices through fines; and (ii) private enforcement initiated by the victims of anti-competitive practices before national courts to obtain compensation for the prejudice resulting from a cartel or abuse of dominant position. The Directive primarily concerns the second procedure and would harmonize the national systems of the Member States in this matter by establishing a set of common rules which are meant to facilitate actions for damages:
- The national judge will be able to order the disclosure of evidence held by the opposing party or a third party, while ensuring that these requests are proportionate and that the confidential information contained therein is duly protected. However, to reconcile the compensation purpose pursued by the Directive with that of the efficiency of the investigations conducted by the competition authorities, some exceptions have been provided, such as the leniency declarations and the proposed undertakings before competition authorities which may never be disclosed. The investigations’ efficiency is largely ensured by the leniency mechanism which plays an important role in detecting infringements, thus guaranteeing companies that their self-incrimination will not then weaken their legal situation before the judge;
- A final decision of a national competition authority finding an infringement will automatically constitute proof before the courts of the relevant Member State of the existence of the infringement, which is already the case under French law for class actions;
- Finally, if an infringement has caused price increases, and these have been passed on along the distribution chain, those who suffered the harm in the end will be the ones entitled to claim compensation. The Directive thus allows the passing on defense by the authors of the infringement: as under French law, the intermediary which has passed on the higher price to its own clients or consumers will not be entitled to damages.
In the end, although this Directive is likely to give a real boost to actions for damages, viewed as an additional means to control anti-competitive practices, its transposition by the Member States will not be an easy task, in particular given the current existing national procedural rules on access to the file and statutes of limitations.