On 6 July 2021, the Amsterdam Court of Appeal rendered an interim judgment in the Air Cargo proceedings regarding the question of applicable law. 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, 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).