European Commission evaluates first four years of Antitrust Damages Directive

On 14 December 2020, the European Commission published an evaluation of the implementation of the Antitrust Damages Directive (the Directive) (PDF), four years after it entered into force in December 2016. The Commission welcomes the increase in the number of antitrust damages actions brought across Member States, but notes that it is too early to draw any concrete conclusions on the actual application in practice and effectiveness of the Directive.

The Directive was adopted in 2014 and aims to facilitate damages actions in the EU, so that any individual can effectively claim full compensation for the harm suffered as a result of infringements of Articles 101 and 102 TFEU. The Directive, therefore, includes rules that remove practical obstacles in exercising this right, such as rules on access to evidence, statutory limitation periods and quantification of damages.

Under Article 20 of the Directive, the Commission was required to review the Directive and to report to the European Parliament and Council by 27 December 2020, eventually accompanied by a further legislative proposal. In its report, the Commission finds that sufficient evidence to carry out a meaningful evaluation of the Directive is not yet available, because

• The majority of the Member States (21) failed to implement the Directive before the deadline of 27 December 2016, triggering infringement procedures by the Commission. By the first half of 2018, all of the Member States had implemented the Directive, but many ongoing damages claim cases fall outside the scope of the Directive because of the transitional regimes contained in the Directive and implementing legislation; and
• Even in specific cases where the rules of the Directive are applicable, a concrete application by national courts is required for any meaningful operational experience. Proceedings for awarding damages are complex and it can take a long time from the purchase of the product or service that has been subject to an infringement of Article 101 or 102 TFEU to the first civil judgment. The report references that a recent study found that it takes on average approximately 13 years.

As a result, the Commission focuses on key developments on the implementation of the Directive:

• There is a clear increase in the number of antitrust damages actions across Member States. The number of cases referred to the CJEU for a preliminary ruling has also increased. The Commission concludes that EU antitrust law has become more relevant and that it has enhanced the awareness of victims of EU competition law infringements of their right to  claim damages;
• There seems to be  consistent implementation of the Directive across the Member States, with some variations and extensions. The report highlights several Member States which have taken additional measures, such as Germany and Portugal where the rules of the Directive also apply to declaratory actions, injunctions and interim measures. Three Member States have extended the rebuttable presumption that a cartel causes harm, set out in Article 17 of the Directive. In Hungary and Latvia, a rebuttable presumption has been adopted that a cartel   would cause an overcharge of 10 per cent, and in Romania an overcharge of 20 per cent;
• The Commission’s own contribution to the implementation of the Directive including the Passing-on Guidelines and the Confidentiality Communication. Although these are not binding and do not alter existing rules under EU or Member State law, their goal is to be a source of inspiration, in particular for national courts that deal with antitrust damages actions. The Commission will continue its contribution, for example through submitting observations in preliminary ruling references to the CJEU, cooperation with national courts, training of judges, and engaging in advocacy efforts; and
• A high-level summary of four key judgments of the CJEU (Cogeco, Skanska, Tibor-Trans and Otis). On Skanska, the Commission’s view is that this ruling confirms that the concept of undertaking in public enforcement also applies in private enforcement. This conclusion does not appear to be entirely consistent with findings of several national courts (notably Germany and the Netherlands) where it was held that the scope of the Skanska ruling is limited to cases where the principle of ‘economic continuity’ applies.

Although not producing the report intended by the Directive due to circumstances beyond its control, the Commission’s report provides a benchmark against which to asses future reports on the Directive.