The Spanish District Court referred questions to the CJEU, which the CJEU published on 20 September 2021. The questions pertain to the question of whether the rules for allocating the costs of the proceedings can constitute an infringement of the right of cartel victims to compensation. In addition, the Spanish District Court referred questions about when courts may estimate the amount of the damage, based on EU rules.[1]

[1] Official Journal of the European Union 20 September 2021, Request for a preliminary ruling from the Juzgado de lo Mercantil n. 3 de Valencia (Spain) lodged on 19 May 2021 — Tráficos Manuel Ferrer, S.L. and Other v Daimler AG, Case C-312/21.

On 15 July 2021, the Court of Justice of the European Union (the “Court“) rendered a judgment that clarifies which national courts within an EU Member State have jurisdiction over actions for cartel damages.[1] Questions about the interpretation of Article 7(2) of the Recast Brussels Regulation[2] arose in Spanish proceedings between RHS, an undertaking domiciled in Spain, on the one part, and the Volvo Group on the other, concerning payment of damages for its involvement in the truck cartel. Article 7(2) of the Recast Brussels Regulation confers jurisdiction on the court for the place where the damage occurred.

RHS had purchased trucks in Cordoba, Spain, and also has its registered office there but it brought its action before the court of Madrid. The Volvo Group consequently contended that the Spanish courts did not have international jurisdiction since the cartel was concluded in other Member States of the EU and the ‘place where the harmful event occurred or may occur’ referred to in Article 7(2) is the place where the truck cartel was concluded, and not where the applicant in the main proceedings is domiciled.

The Spanish court therefore asked the CJEU, in essence, whether Article 7(2) must be interpreted as meaning that this provision constitutes a rule which strictly concerns international jurisdiction or whether it is a dual or combined rule which also operates as a rule on local territorial jurisdiction, without any need to refer to domestic regulation.

Briefly put, the Court held:

• Article 7(2) directly and immediately confers both international and territorial jurisdiction on the courts for the place where the damage occurred and therefore there is in principle no need to refer to national rules determining the jurisdiction of courts;
• However, there is one exception: the delimitation of the court’s jurisdiction within which the place where the damage occurred is situated, is as a rule a matter for the organisational competence of the Member State to which that court belongs, and jurisdiction may be centralised before a single specialised court. In other words, EU Member States are allowed to designate centralised courts to deal with cartel damages cases;
• In the absence of such a specialised court, there are two options: (1) where the injured party purchased goods affected by the cartel exclusively within one EU Member State within the affected market, the courts of that Member State have jurisdiction, or (2) where the injured party has made purchases in several places, each undertaking that has been harmed may bring a follow-on action before the court where it has its registered office.

[1] Judgment of the Court of 15 July 2021 in Case C-30/20, ECLI:EU:C:2021:604.

[2] Regulation (EU) No 1215/2012 of the European Parliament and of the Council of 12 December 2012 on jurisdiction and the recognition and enforcement of judgements in civil and commercial matters.

On 30 July 2021, Prysmian, producer of underground and submarine cables for the transmission and distribution of electricity, reached a confidential settlement agreement with Scottish and Southern Energy and other energy companies in proceedings concerning Prysmian’s involvement in the power cables cartel.[1] On the side of Prysmian, the entities involved in the settlement agreement are Prysmian Cable & Systems Limited, Prysmian Cavi E Sistemi SRL, Prysmian S.P.A., Prysmian Construction Company Limited and Prysmian Cables (2000) Limited, and on the other side SSE PLC, Scottish and Southern Energy Power Distribution Limited, SSE Services PLC, Southern Electric Power Distribution PLC, Scottish Hydro Electric Power Distribution PLC, Scottish Hydro Electric Transmission PLC.[2]

[1] European Commission decision of 2 April 2014, Case AT.39610 (Power cables).

[2] CAT Consent order of 20 August 2021, Case Nos 1353/5/7/20 (T).

On 26 July 2021, the CAT ruled that cartelist NTN may not appeal the Tribunal’s decision of 18 June 2021[1] in which the Tribunal disregarded some of NTN’s defences regarding mitigating circumstances for the claimants by reducing other costs.[2] NTN was fined by the European Commission (EC) in 2014 for its participation in the ball bearing cartel.[3] Ball bearings are used to attach the wheel axle to a vehicle or to attach the wheel to the axle. In response to the EC’s fining decision, Fiat Chrysler Automotives (FCA) initiated proceedings in which it wants to claim its loss from NTN. The CAT ruled that the appeal that NTN wanted to lodge against the decision of 18 June 2021 does not have a “real prospect of success” and is therefore not allowed.

[1] CAT 18 June 2021, [2021] CAT 14, Case No 1357/4/7/20 (T).

[2] CAT 26 July 2021, [2021] CAT 25, Case No 1357/5/7/20 (T).

[3] European Commission decision of 19 March 2014, Case Comp/39922 (Bearings).

On 15 July 2021, the Japanese bank Mitsubishi UFJ Financial Group (formerly Bank of Tokyo-Mitsubishi) told a UK judge during the last day of a five-day hearing at the UK’s specialised competition court that the allegation of “tacit coordination” was erroneous and detrimental to the mass antitrust claim lodged by former inquiry group chairman of the Competition and Markets Authority Phillip Evans.[1]

MUFG was fined nearly 70 million euros ($83 million) by the European Commission in May 2019 for being involved in one of two cartels in the spot forex market, which are agreements to exchange a specific amount of one currency against another.

Evans is one of two class representatives seeking, on behalf of thousands of investment firms, to sue MUFG and others for billions of pounds in damages over the cartel activity. He argued that the sharing of information within the cartel facilitated tacit, or inexplicit, coordination between traders to widen “bid-ask” spreads. Further, he said that due to their market power, the cartelist banks had the ability and incentive to “engage” in tacit coordination on spreads.

MUFG told the UK judge that this was a flawed allegation and that the tacit coordination is just a theory. It is unfeasible for a few participating traders to tacitly control the market and cause this alleged widespread coordination of spreads. Moreover, the banks were not in a position to engage in tacit coordination as their market shares fluctuated over time.

It was the Commission’s investigation that revealed that some individual traders in charge of forex spot trading, on behalf of banks, exchanged sensitive information and trading plans, and occasionally coordinated their trading strategies.[2] It said that activity, resulting from a “tacit understanding” between traders, enabled informed market decisions.

MUFG said about this investigation that they contest the notion that you can go from incidental spread exchanged between a handful of traders to tacit coordination of all spreads by those traders, and then to tacit coordination of all spreads by those banks.

[1] According to MLex, “Banks didn’t and couldn’t use ‘tacit coordination’ to rig forex prices, MUFG tells UK judge,” 15 July 2021.

[2] European Commission, “Antitrust: Commission fines Barclays, RBS, Citigroup, JPMorgan and MUFG €1.07 billion for participating in foreign exchange spot trading cartel,” 16 March 2019, https://ec.europa.eu/commission/presscorner/detail/it/IP_19_2568.

On 13 July 2021, another lawsuit was filed in connection with the truck cartel[1] at a London court. UK retailer William Morrison Supermarkets is claiming damages from truck manufacturers DAF Trucks and Volvo for their involvement in the cartel together with other truck manufacturers that received a record fine from the European Commission in 2017.[2]

[1] European Commission decision of 19 July 2016, case AT.39824 (Trucks).

[2] According to MLex, ‘Retail group Morrisons sues Volvo, DAF in UK over trucks cartel’, 13 July 2021.

In Q1, we wrote about the decision of the High Court that was detrimental to investment funds Allianz Global Investors et al. The High Court had not given them permission to appeal the decision that allowed the banks that participated in the foreign exchange cartel in the proceedings instituted against them by the funds to assert in those proceedings that the investment funds passed on the damage they believed to have suffered to investors. The High Court initially had not given permission for reasons concerning case management because it feared a delay in the proceedings if the appeal were allowed.

In Q2, both the investment funds and the other claimants were given permission to appeal this decision. This will give them another opportunity to challenge the passing-on defence of the cartelists. According to the claimants, only the investment funds have a possible legal claim against the cartelists and this does not apply to independent investors. In addition, they believe that if the District Court were to agree with this passing-on defence of the banks, this would have far-reaching (and undesirable) consequences for the scope of future claims and thus also for the necessary provision of proof and the surrender of and access to documents in these and similar proceedings. The hearing is scheduled for 8 December 2021,[1] so that we will report on it in Q4.

[1] According to MLex, ‘Allianz Global Investors, others win permission to appeal UK forex cartel ‘pass-on’ ruling’, 1 July 2021.

On 30 September 2021, the Landgericht Munich I rendered two decisions regarding the truck cartel, as follows from an article in the Süddeutsche Zeitung of the same day.[1] In both proceedings, the same two experts were instructed to investigate whether the claims for damages totalling nearly EUR 450 million were justified. The judgments are (as yet) unpublished.

In the case of DB Competition Claims GmbH, a subsidiary of the Deutsche Bahn group, against the six truck manufacturers MAN, Daimler, Iveco, Volvo/Renault, DAF and Iveco, Deutsche Bahn sought compensation of EUR 395 million for cartel damage in respect of 39,000 trucks in 18 federal states in the period 1997 to 2019. In another case, 13 German federal states are claiming EUR 49 million due to cartel damage for purchased trucks. In Munich, more than 100 civil lawsuits are said to be pending against the truck manufacturers, involving 250,000 trucks.

Deutsche Bahn responded to the news. According to a press release, the carrier hopes that the truck manufacturers will take responsibility and reach a settlement.[2]

[1]              “Lkw-Kartellprozess: Gutachter sollen Schadenshöhe klären”, Süddeutsche Zeitung, 30 September 2021.

[2]              “Lkw-Kartell: DB erwartet zügige Schadensregulierung durch Lkw-Hersteller”, press release on the website of Deutsche Bahn, 30 September 2021.

On 6 July 2021, the Amsterdam Court of Appeal rendered an interim judgment in the Air Cargo proceedings regarding the question of applicable law.[1] The proceedings were initiated by KLM, British Airways and Lufthansa and other airlines against the Dutch claim vehicles Equilib Netherlands B.V. and Stichting Cartel Compensation and concerned in particular the status of the cartel decision and the law applicable to the claims.

First of all, the Court of Appeal held that it could rely on the facts established by the European Commission in the cartel decision, even if an appeal is pending against this decision.

As far as applicable law is concerned, the Court of Appeal decided that Article 4 of the Unlawful Act (Conflict of Laws) Act (Wet conflictenrecht onrechtmatige daad “WCOD”) offers the relevant legal framework. The Court of Appeal found that, in principle, the law of the state of the airport of departure is applicable to each individual claim of each individual shipper per flight.

The Court of Appeal went on to note that this outcome would lead to a strong fragmentation of the applicable law. Strict application of Article 4 WCOD would lead to dozens of different applicable legal systems. In order to prevent this fragmentation, the Court of Appeal ruled first that the individual claims of each shipper must be considered as a whole, analogous to the concept of ‘a single continuous infringement’ as applied by the Commission in its cartel decision. Secondly, the Court of Appeal found that not only the airport of departure, but also the airport of arrival is relevant to the determination of the applicable law. The scope of Article 4 WCOD is not limited to the place where competition is directly harmed by the anti-competitive conduct, but also includes the place that has been affected indirectly (for example in case of umbrella damage).

As also confirmed by the Commission in its cartel decision,[2] the Aircargo cartel led to the restriction of competition in several places. The Court of Appeal ruled that, as a result, the claim of a single shipper is already governed by various applicable legal systems. The WCOD does not provide a solution for such a case. In order to fill this loophole in the legislation, the Court of Appeal found guidance in established (EU) principles, such as legal certainty and effectiveness. The Court of Appeal noted that the EU legislature provided for this issue in Article 6(3)(b) of Regulation (EC) No 864/2007 (also referred to as ‘Rome II’), in which the claimants are given the opportunity to choose the applicable law themselves under strict conditions.

Since the claimants in this case (Equilib and SCC) had requested the applicability of Dutch law, the Court of Appeal concluded that the claimants’ claims for damages are governed by Dutch law. This applies to claims relating to flights falling within the scope of the cartel decision (flights that have their departure and/or arrival within the EEA and Switzerland).

[1] Amsterdam Court of Appeal 6 July 2021, ECLI:NL:GHAMS:2021:1940.

[2] See the Commission’s press release of 17 March 2017: Antitrust: Commission re-adopts decision and fines air cargo carriers € 776 million for price-fixing cartel.

On 11 March 2021, the CJEU was asked by a Spanish court to render a preliminary ruling on Article 5(1) of the Damages Directive (Directive 2014/104/EU)[1] in the context of an action for damages instituted in response to the trucks cartel.[2] We covered this earlier in Q (2021-1). The CJEU published the questions in Q2. The question put forward is as follows:

“Must Article 5(1) of Directive 2014/104/EU of the European Parliament and of the Council of 26 November 2014 on certain rules governing actions for damages under national law for infringements of the competition law provisions of the Member States and of the European Union be interpreted as meaning that the disclosure of relevant evidence refers exclusively to existing documents in the control of the defendant or a third party or, in contrast, can Article 5(1) also include the disclosure of documents that must be created ex novo by the party to whom the request for information is made by compiling or classifying information, knowledge or data held by it?”

[1] Directive 2014/104/EU on certain rules governing actions for damages under national law for infringements of the competition law provisions of the Member States and of the European Union.

[2] AD and Others v. PACCAR Inc, DAF Trucks N.V. and DAF Trucks Deutschland GmbH, Case C-163/21.