The Final Liable Entity in Cartel Damages Cases On the contemporary determination of external liability in follow-on cartel damages cases and an argument for the uniform

(1)

Faculty of Law

The Final Liable Entity in Cartel Damages Cases

On the contemporary determination of external liability in follow-on cartel damages cases and an argument for the uniform determination of internal

liability

January 2020

Name: G.M.J. (Sepp) Nielen. Student ID: 10500162

Mastertrack: European Competition Law and Regulation Email: seppnielen@hotmail.com

(2)

Abstract

Contemporary developments in the field of follow-on cartel damages cases concerning the applicable law create an obscure scope of the external liability regime. This makes it unclear which entities claimants can claim compensation from. Furthermore, the internal liability regime governing how liability is apportioned amongst co-infringers, is characterised by uncertainty as well, specifically originating from the lack of a uniform standard for the determination of a "co-infringers' relative responsibility". Indeed, neither case-law nor legislative instrument provides a uniform standard for its determination and the contemporary literature equally remains silent on this specific issue. In light of this, this thesis offers both a complete analysis of the contemporary status of the external and internal liability regimes in follow-on cases. It additionally presents an argument for claiming the determination of the latter as a matter for EU law. By an analysis of case-law, legislation, and relevant literature this thesis posits that the Skanska-judgment's transposition of the "undertaking" concept from public to private enforcement, nullifies the relevance of national rules on external liability. Since parental liability is a rather well-established EU public enforcement principle, uncertainties primarily remain regarding the potential for sister and subsidiary liability. It is posited that it depends on the exact doctrinal foundation for liability, "decisive

influence" or "unity of action", whether these forms of liability are allowed. Notably,

only the latter permits an EU-wide application of both types. Regarding internal liability. The ruling uncertainty concerning the determination of a "co-infringers'

relative responsibility" necessitates the initiation of avoidable procedures by

co-infringers claiming restitution for compensation paid in excess. In addition, it compromises the achievement of EU objectives and it hinders claimants and co-infringers to enter into (partial) settlement talks. However, this thesis presents a legal argument for claiming the determination of "relative responsibility" as a matter for EU law and as such to establish an EU-wide standard. It is argued that "relative

responsibility" is a constitutive condition of the EU right to full compensation. Hence,

it is posited that "relative responsibility" should be a matter for EU law in order to guarantee said right's uniform application and "article 110 TFEU's full effectiveness", and to avoid the categorical exclusion of certain claimants. Furthermore, it is argued that as a co-infringer's right to contribution is a right guaranteed by EU law and "relative

(3)

Table of Chapters

LIST OF ABBREVIATIONS ... 7

CHAPTER I – INTRODUCTION ... 8

CHAPTER II – ON THE ENFORCEMENT OF EU COMPETITION LAW ... 12

CHAPTER III – ON THE DETERMINATION OF EXTERNAL LIABILITY ... 20

CHAPTER IV – ON THE DETERMINATION OF INTERNAL LIABILITY ... 31

CHAPTER V – CONCLUSION ... 46

(4)

List of Abbreviations

Abbreviation Definition

CDC Cartel Damages Claims

ECJ European Court of Justice

ECN European Competition Network

EU European Union

NCA National Competition Authority

NCC NCC Industries

SEE Single Economic Entity

SIS Skanska Industrial Solutions

TFEU Treaty on the Functioning of the European Union

The Court European Court of Justice

The Damages Directive Directive (EU) 2014/104 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 [2014] OJ L349/1.

(8)

That directive 2014/104/EU has now harmonised certain aspects of actions for antitrust damages brought before national courts. However, like the case-law, that directive leaves several questions of principle unanswered.1

– Advocate-General Wahl

Chapter I – Introduction

I.1 Problem Statement and Research-question

I.1.a Problem Statement

Imagine, an owner of a medium sized logistic company, with activities across the European Union ("EU"), discovers that the company bought several trucks from the infamous price-coordinating Truck Cartel during its lifespan (1997-2011).2_Regardless

of the record EUR 2.93 billion fine imposed by the European Commission ("Commission"), the company alone bears its financial injuries.3_{However, the legal}

department recalls that EU law – by virtue of both case-law4_{and legislation}5_{– grants}

to victims of cartels the right to claim compensation for damages resulting from that cartel's anticompetitive activities.Hence, this claim, alongside many more claims, is transferred to a claim-organisation, e.g. Cartel Damages Claims ("CDC")6_{, by agency}

or power of attorney agreement. CDC then decides how and where to initiate an action for damages on the basis of an infringement of EU competition law (also known as

1_{Case C-724/17 Vantaan Kaupunki v Skanska Industrial Solutions Oy and Others [2019]}

ECLI:EU:C:2019:204, Opinion of Advocate-General Wahl, para 22.

2_{Christian Oliver, Peter Campbell, 'EU set to impose record cartel fine on truckmakers' Financial Times}

(Brussel and London, 29 May 2016)

<https://www.ft.com/content/eba2818c-23f8-11e6-9d4d-c11776a5124d> accessed 6 January 2020.

3_{'Statement by Commissioner Vestager on decision to fine truck producers €2.93 billion for participating}

in a cartel' (Press Releases, 19 July 2016)

<https://ec.europa.eu/commission/presscorner/detail/en/STATEMENT_16_2585> accessed 30 December 2019.

4_{Case C-453/99 Courage Ltd v Bernard Crehan [2001] ECLI:EU:C:2001:456, para 23.}

5_{Directive (EU) 2014/104 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 [2014] OJ L349/1.

6 _'We _obtain _optimum _compensation _for _your _antitrust _damage' _(Our _Cases)

<www.carteldamageclaims.com/competition-law-damage-claims/trucks-cartel/> accessed 30 December 2019.

(9)

antitrust law) against the Cartel's members. This is known as a follow-on or private enforcement proceeding.7

Unlike the Commission's fining procedures which are governed directly by EU competition law, the exercise of the right to compensation is mostly governed by the Member States' national legal regimes. However, in its Skanska-judgment the European Court of Justice ("ECJ" or "the Court") blurred the line between the traditionally applicable national law and EU law,8_{as it held that the liable entity in follow-on}

procedures is to be determined by reference to EU law.9_{This influences the applicable}

rules regarding external liability, i.e. which entities can be sued for damages. Additionally, the internal liability-regime, which determines how liability is ultimately approportionate among co-infringers, is equally affected by this blurring of the lines. Especially the latter is not an often-discussed issue, yet it is a critical one. Indeed, the current uncertainties, specifically caused by the unclear standard for the determination of an infringer's "relative responsibility" for the harm caused, will undoubtedly result in preliminary questions being directed to the ECJ.

I.1.b Research-question and Sub-questions

Against this background, the research-question this thesis posits, is the following:

In follow-on cases, which entities can be held externally liable and how is the determination of a co-infringer's "relative responsibility" made in light of the co-infringers' internal liability?

In order to facilitate answering this question, this thesis is divided in multiple sub-questions. First, what are the substantive EU rules sanctioning anticompetitive

behaviour? Second, how is EU competition law enforced? Third, what did the Court

7_{Notably, the Netherlands is a popular claim destination, e.g. 'CDC achieves first key judgment in the}

Trucks cartel litigation in the Amsterdam District Court' (Press Release, 17 May 2019) <www.carteldamageclaims.com/wp-content/uploads/2019/05/190517-CDC-Press-release-Judgment-Amsterdam-District-Court-Trucks-Cartel-Litigation-1.pdf> accessed 30 December 2019.

8_{Catherine Bernard, Steve Peers, European Union Law (2}nd_{, OUP 2017), 512.}

9_{Case C-724/17 Vantaan kaupunki v Skanska Industrial Solutions Oy and Others [2019]}

(10)

say in Skanska? Fourth, what are Skanska’s consequences for liability in follow-on procedures? Fifth, are Skanska’s consequences desirable? Sixth, what is the doctrine of joint and several liability? Seventh, what is meant by the determination of one’s "relative responsibility" and why is it relevant? Eight, is a uniform standard regarding the determination of "relative responsibility" desirable? And lastly, does contemporary EU law allow a uniform standard for the determination of one's "relative responsibility" to be created?

I.2 Aims, Methodology and Legal framework, and Structure

I.2.a Aims

This thesis aims at providing a complete analysis of the contemporary standards regarding liability – both externally and internally – in damages procedures related to an infringement of competition law. Regarding external liability, it is examined whether national law is decisive for the determination of parental, subsidiary or sister liability, or if this is to be decided by referring to EU law. And are these types of liability even possible under the latter's regime? It is argued that external liability in these national procedures is now a matter for EU law. Whether subsidiary and sister liability are allowed, depends on the (for now uncertain) doctrinal basis for external liability.

Additionally, this thesis examines by which legal regime internal liability is governed. A specific point of interest in this regard is the determination of the "relative

responsibility" of co-infringers. Indeed, contemporary competition law and case-law

are rather vague as to which standards should be used to determine "relative

responsibility". This thesis posits that the ensuing uncertainty negatively affects the

enforcement of EU competition law. Simultaneously, it presents a legal argument for enabling the EU (judiciary) to claim this determination as a matter to be determined by EU law and as such to establish a uniform standard. Nonetheless, it should be noted that it is not this thesis' ambition to propose the "correct" method to determine this share. In essence, this thesis solely envisions the establishment of a workable argument for claiming the determination of "relative responsibility" as a matter for EU law.

(11)

I.2.b Methodology and Legal Framework

In light of this, the following methodology is applied to this thesis. The research performed is primarily library-based and the legal background against which this thesis' examination takes place is formed by EU and national (competition) law. Hence, the consulted sources are EU and national case-law, Opinions of ECJ Advocates-General, relevant EU and national antitrust legislation, and thereto related preparatory works and policy documents. The appropriate contemporary (inter)national legal literature and legal opinions concerning the discussed subjects have been consulted as well.

I.2.c Structure

Structure-wise this thesis is divided into multiple Chapters and sub-Chapters which correspond with the sub-questions posited by this thesis. Each Chapter ends with a conclusion in which its sub-questions are answered.

Chapter II provides the necessary background information concerning the substantive EU competition rules and both the private and public enforcement thereof. Furthermore, the nature of the former and the interplay between both are expanded upon. As such, the legal framework in which this thesis' analysis takes place is clarified.

Chapter III is devoted to the doctrines relevant for the establishment of external liability. Hence, the Skanska-judgment, its influence upon parental, sister and subsidiary liability, and the desirability thereof are examined.

Once it is determined which entity can be held externally liable, Chapter IV focusses upon internal liability. It explains the concept of joint and several liability, the relevance of the determination of "relative responsibility", and its problematic nature. Furthermore, it emphasises the desirability of uniformity thereof, and the current legal opportunities to claim the field for EU law.

Chapter V forms the closing piece of this thesis wherein a final answer to the research-question is provided.

(12)

Chapter II – On the Enforcement of EU Competition Law

II.1 Introduction

The following Chapter provides a short introduction to the EU's competition rules and the public and private enforcement thereof. Accordingly, this Chapter answers the sub-questions: what are the substantive EU rules sanctioning anticompetitive behaviour (II.2) and how is EU competition law enforced (II.3).

II.2 On the Substantive Law, a Prohibition of Cartels

By virtue of article 101(1) of the Treaty on the Functioning of the European Union ("TFEU"), agreements between "undertakings", decision by associations of "undertakings" and concerted practices, which may affect trade between the Member States and which have as their object or effect the prevention, restriction, or distortion of competition within the internal market, are prohibited.10_{Article 102 TFEU prohibits}

the abuse of a dominant position, but this thesis solely focuses upon the cartel prohibition of article 101 TFEU, and the subsequent cartel damages proceedings.

To list a few examples of agreements which could be prohibited by article 101 TFEU: price-fixing, allocation of markets, resale price maintenance, and certain territorial restrictions.11_{These examples constitute hard-core restrictions, which are per se}

covered by article 101 TFEU. Any agreement which infringes article 101 TFEU's prohibition is automatically void and the "undertakings" involved may be subject to fines from the regulatory authorities.12

However, if an agreement does hinder the competitive process, the entities involved can argue that a justification for this conduct exists. Indeed, if the agreement contributes

10_{Consolidated version of the Treaty on the Functioning of the European Union [2012] OJ C326/47,}

article 101(1).

11_{Directorate-General for Competition, ‘Glossary of terms used in EU competition policy’(Publication}

Office of the EU, 2003) 22-23

<https://op.europa.eu/en/publication-detail/-/publication/100e1bc8-cee3-4f65-9b30-e232ec3064d6#> accessed 30 December 2019.

(13)

to the improvement of the production or distribution of goods, or if it promotes technical or economic progress, whilst it allows consumers a fair share of the resulting benefits, it may be allowed to remain in place.13_{Additionally, in order to be justified, an}

agreement cannot impose on the "undertakings" concerned restrictions which are not indispensable for the attainment of the previously mentioned objectives. The "undertakings" concerned may also not be afforded the possibility of eliminating competition in respect of a substantial part of the products in question.14_{Via the various}

Block Exemption Regulations many forms of behaviour have categorically been exempted from the cartel prohibition.15

II.3 A Public and Private Level of Enforcement

The EU's competition rules are enforced by both public authorities and by private individuals. In the former, a regulatory public authority initiates a procedure against a private party which it suspects to have infringed a competition rule. The latter refers to the practice of private entities suing other entities that have committed anticompetitive behaviour. These private individuals may, for example, seek the termination of or compensation for an infringement of competition law. Respectively, these enforcement levels are referred to as the public and private enforcement of EU competition law.16

II.3.a Enforcement by Public Authorities

The public enforcement of EU competition law is a task bifurcated in an EU-wide branch spearheaded by the Commission, and a Member State/national branch championed by the various National Competition Authorities ("NCAs"). However, one would be incorrect in assuming that this divided pubic enforcement-regime causes an incoherent application of EU competition law. Rather, the Commission and the NCAs

13_{ibid article 101(3).} 14_{ibid article 101(3)(a)-(b).}

15_{E.g., Commission Regulation (EU) No 330/2010 of 20 April 2010 on the application of Article 101(3)}

of the Treaty on the Functioning of the European Union to categories of vertical agreements and concerted practices [2010] OJ L102/1.

16_{Georg Berrisch, Eve Jordan, Rocio Salvador Roldan, 'E.U. Competition and Private Actions for}

(14)

cooperate closely on enforcing EU competition rules in a framework referred to as the European Competition Network ("ECN").17

Regulation 1/2003 is the leading document concerning public enforcement.18_It

introduced an enforcement-system based on the direct application of EU competition law. It enabled the various NCAs and their respective national courts to apply these rules in full and additionally introduced the ECN in order to facilitate a system for close cooperation. If a competitive restrictive agreement or practice impacts several Member States, the Commission most likely will claim competence in the investigation rather than letting the NCA take point.19_{Additionally, Regulation 1/2003 grants the}

Commission significant powers to enforce compliance with articles 101 and 102 TFEU. These include, for example, the power to investigate suspected infringement of competition law20_{, to subsequently issue decision,}21_{and to impose fines on infringers.}22

In general, the powers granted to the NCAs are similar to the Commission's powers.23

Typically, an infringement investigation commences with a competition authority performing a dawn-raid at the suspects' premises (i.e. on-site inspections). Prior or during these investigations, suspects may apply for leniency by turning on their co-infringers. Once a case can be substantiated, the authority sends Statements of Objections to suspected "undertakings", which in their turn may submit a Statement of Defence. A subsequent hearing may take place, after which a fine may be imposed upon the infringing "undertakings" if deemed necessary.

17_{'Directive to make national competition authorities more effective enforcers (ECN+)' (Empowering}

National Competition Authorities, 14 January 2019)

<https://ec.europa.eu/competition/antitrust/nca.html> accessed 3 January 2020. See also, Kati Cseres, ‘Comparing laws in the enforcement of EU and national competition laws’ (2010) 3(1) European Journal of Legal Studies 7, 11.

18_{Council Regulation (EC) No 1/2003 of 16 December 2002 on the implementation of the rules on}

competition laid down in Articles 81 and 82 of the Treaty [2003] OJ L1/1.

19_{Pieter van Cleynenbreugel, Market Supervision in the European Union (Brill Nijhoff 2014) 171.} 20_{Regulation 1/2003 (n 18) article 7.}

21_{ibid article 20.} 22_{ibid article 23.}

23_{Directive (EU) 2019/1 of the European Parliament and of the Council of 11 December 2018 to}

empower the competition authorities of the Member States to be more effective enforcers and to ensure the proper functioning of the internal market [2019] OJ L11/3.

(15)

Whilst the Commission executes these powers under the sole supervision of the EU judiciary,24_{NCAs operate under auspices of their own national courts. Should the}

former be the authority issuing fines, its decision can be appealed at the EU's General Court via an action for annulment.25_{This decision itself is reviewable by an}

Advocate-General and the ECJ. If, however, an NCA is the authority imposing fines, this decision can be appealed at the competent national courts. If necessary, these courts can, and if they are ruling in last instance even must, refer preliminary questions to the ECJ regarding the interpretation of EU law (e.g. 101 TFEU).26_{As such, preliminary}

references help guarantee the uniform and effective application of EU antitrust rules and prevent a divergent interpretation.27_{Usually after these public proceedings come}

to an end, and a fine becomes set in stone, private enforcement cases are initiated.28

II.3.b Enforcement by Private Entities

A concept that is of fundamental importance to the private enforcement of EU competition law, is the right to claim compensation for damages suffered by infringements of EU antitrust law. It should be noted that the EU Treaties lack a provision that explicitly confers upon individuals such a right. Therefore, by ECJ pronouncements, the right to full compensation and the therefrom derived field of private enforcement was established and has thereafter been further developed by subsequent rulings.29

i. The ECJ's Contribution

Of paramount importance in this regard is the Courage v Crehan judgment.30_{The ECJ}

held that firstly, the EU Treaties have created their own legal order, integrated within the different legal systems of the Member States. Individuals and Member States both

24_{ibid article 31.}

25_{TFEU (n 10), article 263.} 26_{ibid article 267.}

27_{Margot Horspool, Matthew Humphreys, European Union Law (7}edn_{, OUP 2012) 88.} 28_{See example at I.1.a.}

29_{Niamh Dunne, 'The Role of Private Enforcement within EU Competition Law' (2014) 16 Cambridge}

Yearbook of European Legal Studies 143, 154. See also e.g. Case C-360/09 Pfleiderer AG v

Bundeskartellamt [2010] ECLI:EU:C:2010:782, Opinion of Advocate-General Mázak, para 36.

(16)

are subjects of this EU legal order.31_{Secondly, article 101 TFEU constitutes a}

fundamental provision which is essential for the accomplishment of the tasks entrusted to the EU and the functioning of the EU internal market. This importance leads to the automatic and absolute nullity of agreements or decisions violating article 101 TFEU if a justification cannot be fabricated.32_{Thirdly, the Court emphasised that articles 101}

and 102 TFEU produce direct horizontal effect and create individual rights which national courts must safeguard.33_{Accordingly, this led to the conclusion that}

individuals can rely on breaches of article 101 TFEU in national proceedings to claim compensation. This right to claim compensation covers not only a recovery of actual losses, but also extends to any loss of profits (plus interest).34_{Additionally, losses due}

to umbrella pricing by non-cartel members are covered.35

ii. The EU Legislature's Contribution

In addition to the ECJ's judicial intervention, the EU Legislature's administrative efforts have further bolstered the exercise of the right to claim compensation and thus the private enforcement of EU competition law.36_{In 2008, a Commission White Paper}

offered private individuals a genuinely European framework in which competition rules first were to be protected by public and private enforcement working in parallel.37_In

2014, the EU Legislature passed Directive 2014/104 concerning actions for damages suffered by infringements of EU competition law ("The Damages Directive").38_This

Directive aims to ensure an effective exercise of the right to claim full compensation, to create a level playing field by reducing the difference between the various national

31_{ibid para 19.} 32_{ibid paras 20-22.}

33_{ibid para 23. See also, Case C-127/73 Belgische Radio en Televisie and société belge des auteurs,}

compositeurs et éditeurs v SV SABAM and NV Fonior [1974] ECLI:EU:C:1974:25; Case C-282/95 Guérin Automobiles v Commission of the European Communities [1997] ECLI:EU:C:1997:159.

34_{Joined Cases C-295/04 to C-295/04 Vincenzo Manfredi v Lloyd Adriatico Assicurazioni SpA}

(C-295/04), Antonio Cannito v Fondiaria Sai SpA (C-296/04) and Nicolò Tricarico (C-297/04) and Pasqualina Murgolo (C-298/04) v Assitalia SpA [2006] ECLI:EU:C:2006:461, para 95.

35_{Case C-557/12 Kone AG and others v ÖBB-Infrastuktur AG [2014] ECLI:EU:C:2014:1317, paras}

33-34.

36_{Christopher Bovis, Charles Clarke, 'Private Enforcement of EU Competition Law' (2015) 36 Liverpool}

Law Review 49, 50-53; Dunne (n 29), 154.

37_{European Commission, 'White Paper on Damages actions for breach of the EC antitrust rules' COM}

(2008) 165 final, 3. See also, European Commission, 'Green Paper on Damage actions for breach of the EC antitrust rules' COM (2005) 672 final.

(17)

laws of the Member States governing private enforcement actions, and to maximise the effectiveness of both public and private enforcement of EU competition rules by regulating the relationship between them.39_{Furthermore, the Directive specifically}

aims at improving the conditions under which consumers can exercise their rights derived from the internal market. Hence, it was found to be appropriate to reduce the differences between the Member States laws, to prevent any further increase of these differences, and to increase legal certainty with regards to actions for damages suffered by infringements of EU competition law.40_{Perhaps the most important right codified}

by the Directive is the right to full compensation as discussed above. It is now uniformly reiterated that those who have suffered injuries due to infringements of the EU's competition rules can claim compensation for their actual losses, their losses of profits, and any additional interest.41_{Despite originally suffering implementation-delays, the}

Directive has been implemented in all Member States as of 6 June 2018.42

II.3.c The Relationship Between Public and Private Enforcement and the Latter's National Nature

i. The Relationship Between Public and Private Enforcement

Regarding the fundamental importance of the right to claim compensation, it has repeatedly been held that the full effectiveness and the practical effect of article 101 TFEU would be put at risk if it were not open to any individual to claim damages for losses caused by contracts or conduct liable to restrict or distort competition.43_This

paramount importance of the right to compensation in discouraging anticompetitive behaviour and supporting the full effectiveness and practical effect of article 101 TFEU has been reaffirmed and settled by the ECJ's case-law.44_{Hence, the right to}

39_{Regulation 1/2003 (n 18), [1-11].} 40_{Directive 2014/104 (n 5), [9].} 41_{ibid [12] and article 3.}

42_{ibid article 21(1) the implementation deadline was the 27}th_{of December 2016. See also, 'Transposition}

of the Directive in Member States' (Action for Damages, 6 June 2018) <https://ec.europa.eu/competition/antitrust/actionsdamages/directive_en.html> accessed 3 January 2020.

43_{Courage v Crehan (n 4), para 26; Case C-360/09 Pfleiderer AG v Bundeskartellamt [2011]}

ECLI:EU:2011:389, paras 28-29; Case C-435/18 Otis GmbH and Others. v Land Oberösterreich [2019] ECLI:EU:C:2019:1069.

44_{Manfredi (n 34), para 16; Pfleiderer, Opinion (n 29), para 36; Case C-199/11 Europese Gemeenschap}

(18)

compensation and the field of private enforcement play an important part in the overall enforcement of EU competition law. They do so by performing a supplementary and compensatory role to the public enforcement thereof.45_{A role that has been reaffirmed}

by the Damages Directive.

ii. The National Execution of the Right to Compensation

The oft reaffirmed right to claim compensation for damages suffered by causally related infringements of competition law has now become enshrined within the EU's legal order. However, in the absence of EU rules laying down the detailed rules governing such actions aimed at safeguarding rights which individuals derive directly from EU law, the exercise of the right to compensation was to be determined by the Member States' domestic rules, subject to the principles of equivalence and effectiveness.46

These principles respectively mandate that national rules governing the exercise of the right to compensation should not be less favourable than those governing similar national actions, and that such rules do not render it excessively difficult or practically impossible for individuals to exercise their by EU law conferred rights.47_{In general,}

the national laws applicable to follow-on litigation are largely similar to those applicable to regular civil litigation and as such, the former is characterised by the same national divergence as the latter. Consequently, differences in private enforcement procedures across the EU exist as these are subject to different national regimes.48

Donau Chemie AG and Others [2013] ECLI:EU:C:2013:366, para 21; Kone (n 35), para 21; Skanska (n

9), para 25.

45_{Wouter Wils, ‘Private Enforcement of EU Antitrust Law and its Relationship with Public Enforcement:}

Past, Present and Future’ (2017) 40(1) World Competition: Law and Economics Review 3, 39.

46_{Courage v Crehan (n 4), para 29. See also, Case C-261/95 Rosalba Palmisani v Istituto nazionale della}

precidenza sociale [1997] ECLI:EU:C:1997:351 para 27.

47_{For a more detailed explanation regarding these principles, see Catherine Bernard, Steve Peers,}

European Union Law (2nd_{, OUP 2017) 512.}

48_{Stephen Wisking, Kim Dietzel, Molly Herron EU Overview, in ed Ilene Knable Gotts, The Private}

(19)

II.5 Conclusions

Foremost, EU competition law is to a large extent characterised by the prohibitions of cartels and abuses of dominance as enshrined respectively in articles 101 and 102 TFEU.

Furthermore, these competition rules are enforced on a public level, by the Commission and NCAs. The right to compensation in full created by judicial intervention and supported by legislative initiatives, form the basis of the private enforcement of EU competition law. It plays an important part in reinforcing the deterrent effect of the public enforcement of competition law, by performing a supplementary and compensatory role to public enforcement, as reaffirmed by the Damages Directive. However, private enforcement’s legal battles are fought in national courts and are to a large extent governed by the national laws of the Member States.

These conclusions raise questions as to which laws determine the rules on internal and external liability in private enforcement cases. Is this EU or national law?

(20)

Chapter III – On the Determination of External Liability

III.1. Introduction

The following Chapter is devoted to the determination of external liability.49_{Hence, the}

following sub-questions are answered: what did the Court say in Skanska (III.2); what

are Skanska’s consequences for liability in follow-on procedures (III.3); and, are Skanska’s consequences desirable (III.4)?

III.2 The ECJ's Landmark Skanska-Judgment

On the 14th_{of March 2019, the ECJ came to a decision in the landmark Skanska-case.}50

In short, the Court held that the determination of the entity liable to compensate the damages caused by infringements of the EU's antitrust rules is a matter for EU law.51

Noticeably, this determination was previously deemed to be a national matter.

III.2.a Factual Background

In 2004, the Finnish NCA discovered the existence of a cartel within the national asphalt sector. This cartel was active between 1994 and 2004. A complicating factor within this case was the considerable corporate reshuffling that occurred during and after the cartel's period of activity. Multiple cartel members had altered their names, were acquired by other companies after voluntary liquidation procedures, and their commercial activities were transferred to these acquirers. The Finnish Supreme Administrative Court imposed fines upon, among others, the new owners Skanska Industrial Solutions ("SIS"), NCC Industries ("NCC"), and Asfaltmix by applying an economic continuity test. Subsequently the city of Vantaan initiated an action for damages against SIS and its co-infringers. However, a conflict arose between EU and Finnish law. Whilst the imposition of a fine on the basis of the economic continuity principle was in compliance with EU competition law, such legal doctrine did not exist

49_{See definition above at page 8.} 50_{Skanska (n 9).}

(21)

in Finnish private law. Only the legal entity that caused the damage itself can be held to provide compensation. Consequently, in the follow-on procedure, which was governed by Finnish private law, the city of Vantaan was barred from claiming compensation from these three acquirers. This hindered Vantaan’s right to claim full compensation.52_{Hence, the Finnish Supreme Court initiated a preliminary reference}

procedure.53

III.2.b Considerations of the ECJ

The most vital preliminary questions the Court had to consider were firstly 'is the determination of which parties are liable for the compensation of harm caused by conduct contrary to article 101 TFEU to be done by applying that provision directly or on the basis of national provisions?' Secondly, 'if the entities liable are to be determined directly on the basis of article 101 TFEU, are the entities which fall within the concept of "undertaking" mentioned in that article those liable for compensation?'.54_{As the}

response to these two question in conjunction provided an exhaustive answer, the third question was left unanswered.55

In a short judgment, the ECJ firstly held that article 101 TFEU brings with it the right to full compensation for damages caused by its infringements. This in its turn ensures the full effectiveness of the prohibition laid down in article 101 TFEU. Secondly, due to the discouraging effect this right has on "undertakings" wishing to engage in anticompetitive practices, it makes a significant contribution to the maintenance of effective competition within the EU. Thirdly, referring to the Advocate-General's Opinion, the Court argued that private actions for damages are an integral part of the system for enforcement of EU competition rules, which are intended to punish and deter. Fourthly, if infringing "undertakings" could escape the obligation to compensate, this suppressing and deterring objective would be jeopardised.56_{Consequently, the ECJ}

52_{See the discussion above at III.3.b to c.}

53_{Skanska (n 9), paras 6-22. For the relevance of such preliminary questions see the discussion above at}

footnotes 25-26.

54_{ibid para 22 (emphasis added).} 55_{ibid paras 23-52.}

(22)

held that the liable entity in follow-on procedure is indeed to be determined referring to EU legal concepts, i.e. the concept of "undertaking".57

III.3 External Liability, a Family Event

III.3.a A Parallel Application

The ECJ thus held that the determination of the entity liable to pay full compensation is to be determined by EU law. Although Skanska primarily concerned the transposition of the economic continuity principle from the EU to the national level, it influences the rules regarding liability as well. Indeed, the cases brought by public authorities and those brought by private individuals now run parallel to each other.58_{Since in both the}

concept of "undertaking" is henceforth leading for the determination of the liable entity, this concept deserves further scrutiny.

III.3.b The "Undertaking" Concept

i. A Functional Concept

According to article 101 (and 102) TFEU only "undertakings" can commit infringements of the EU's antitrust rules. Yet, the Treaties do not provide a definition of this crucial term and it is generally defined in the ECJ's case-law.59_{Boiling down}

these judicial developments to a core-digest, an "undertaking" is any entity (or several), engaged in an economic activity, regardless of legal status or the manner of financing.60

The definition of an economic activity for these purposes covers the offering of goods

57_{ibid para 47.}

58_{Jeroen Kortmann, Marieke Bredenoord-Spoek, Nienke de Jong, ‘European Court of Justice issues}

landmark ruling on parental liability’ (Stibbeblog, 15 March 2019) <http://www.stibbeblog.nl/all-blog-posts/commercial-litigation/european-court-of-justice-issues-landmark-ruling-on-parental-liability/> accessed 30 December 2019.

59_{A full discussion of the ECJ's interpretation of the "undertaking" concept and related literature is far}

too extensive to take place within the framework of this thesis, it must suffice to discuss the most important developments in so far as they hold relevance for external and internal liability.

60_{Case C-41/90 Klaus Höfner and Fritz Elser v Macrotron GmbH [1991] ECLI:EU:C:1991:161, para}

21; Case C-280/06 Autorità Garante della Concorrenza e del Mercato v Ente tabacchi italiani - ETI SpA

and Others and Philip Morris Products SA and Others v Autorità Garante della Concorrenza e del Mercato and Others [2007] ECLI:EU:C:2007:775, para 38.

(23)

and/or services on a given market.61_{Although it is relevant that the activity is carried}

out under market conditions,62_{it is irrelevant whether the entities involved have a}

profit-making motive, or even an economic motive at all.63

ii. The Single Economic Entity Doctrine

Noticeably, an "undertaking" can be comprised of one or more legal entities via the Single Economic Entity ("SEE") doctrine. This doctrine stipulates that when a company can and indeed does exercise "decisive influence" over another company, to the extent that the latter does not enjoy real autonomy in determining its commercial policy on the market, they are a SEE and therefore part of the same "undertaking". In order to establish such influence, the economic, organisational, and legal links between the involved entities need to be examined. Naturally, this doctrine severely increases a not-directly infringing entity's risk of being held liable for related entities' conduct on the internal market.64

III.3.c The Doctrinal Foundation for Liability Under EU Law

From the Court's rulings it appears that the liability of a not-directly infringing company is doctrinally justified by relying on this company's exercise of "decisive influence" over the direct infringer. However, it is questionable whether this truly is the doctrinal foundation for liability. Indeed, on the basis of a thorough analysis of the Court's case-law, Kersting argues that "decisive influence" is only a precondition for liability. The true decisive criterion is whether the entities involved collectively form an "undertaking", i.e. liability arises from their "unity of action".65_{The former criterion is}

merely used as a precondition for liability, which itself solely arises from the notion of "undertaking". After analysing the Courts jurisprudence, Kersting mentions that four

61_{Case C-180/98 Pavel Pavlov and Others v Stichting Pensioensfonds Medische Specialisten, [2000]}

ECLI:EU:C:2000:428, para 75.

62_{Case C-205/03 Federación Española de Empresas de Tecnología Sanitaria (FENIN) v Commission of}

the European Communities [2005] Opinion of Advocate-General Maduro ECLI:EU:2005:666, para 13.

63_{E.g. Case C-67/96 Albany International BV v Stichting Bedrijfspensioenfonds Textielindustrie [1999]}

ECLI:EU:C:1999:430, para 85.

64_{Richard Whish, David Bailey, Competition law (9edn, OUP 2018), 93-98.}

65_{Christian Kersting, 'Liability of Sister Companies and Subsidiaries in European Competition Law'}

(24)

steps lead to the establishment of liability. Firstly, an (abstract) external view must be taken in order to define an "undertaking" as 'any entity that is uniformly and jointly engaged in an economic activity'66_{in order to provide a framework for the}

"undertaking's" obligations and liability as a uniform economic unit. Secondly, the criterion of "decisive influence" is used to determine which entity precisely form constituent parts of the "undertaking".67_{Thirdly, a sharpened external view is taken to}

define the exact obligation and breach thereof, and to assign the subsequent liability to a precisely defined economic unit.68_{Fourthly, liability must be allocated to all the}

constituent parts of the "undertaking", as 'only then liability of the individual legal entities corresponds with the liability of the economic unity.'69

III.3.d A Parent's Responsibility

i. From a National Determination of Liability to a European Determination

It might be the more logical/profitable choice for claimants to demand full compensation from a parent company rather than from an infringing subsidiary. Reasons for this strategy could, e.g., relate to the subsidiary being on the brink of bankruptcy or being domiciled too far away. Prior to the Skanska-ruling parental liability was to be determined on the basis of national law. Whilst some legal regimes – e.g. France,70_Spain,71_Portugal,72_UK,73_{and Germany}74_{– allowed some form of group}

or parental liability in the context of the private enforcement of competition law, in other regimes it was rather difficult to establish such liability.75_{Dutch law, for example,}

in general mandates that only they can be held liable who are at fault. Indeed, under

66_{ibid 17.} 67_{ibid 18.} 68_ibid. 69_{ibid 18-19.}

70_{Code de Commerce, article L. 481-1.}

71_{Ley de Defensa de la Competitencia, article 71.2(b).} 72_{Lei no. 23/2018, article 3(2)}

73_{Competition Appeal Tribunal Case 1241/5/7/15(T) Sainsbury's Supermarkets v Mastercard and}

Others [2016] CAT 11, paras 363-364

74_{Gezetz gegen Wettsbewerbsbeschränkungen, Section 1, para. 3a. See also, Felix Janka, 'Parent}

Company Liability in German and EU Competition Law: Two Worlds Apart?' (2016) 7(9) Journal of European Competition Law and Practice 614, 616-617.

(25)

Dutch law, even if a parent is named in the Commission Decision, it might be that this named parent cannot be held liable for the damages caused as it was not truly involved in the cartel.76_{Consequently, it is rather exceptional for a parent company to be held}

liable for something its subsidiary has done.77_{Only if the parent company can}

independently for its own conduct in its subsidiary's infringement be held liable, can it be liable for a subsidiary's infringement of cartel damages.78

The EU legal order contains its own regime for such parental liability. The "undertaking's" transposition from public to private enforcement mandates that the SEE doctrine is transposed into the national legal regimes as well. According to this doctrine a parent79_{, a majority shareholder}80_{, or even a minority shareholder}81_{can be held liable}

together with an infringing subsidiary by the Commission for this subsidiary's anticompetitive conduct. This essentially nullifies the importance of national rules on parental lability. It is therefore unsurprising that prior to the Court's Skanska-judgment – and even the adoption of the Damages Directive – opposition could be found against the transposition of the "undertaking" into the national legal order.82

With regard to a parent's liability in follow-on procedures, regardless of the precise doctrinal basis, it becomes of paramount importance to establish that the parent exacted "decisive influence" over its subsidiary's conduct on the market in order to establish that

76_{E.g. see, District Court Eastern-Netherlands Case 208812 TenneT TSO BV, Saranne BV v ABB BV and}

Others [2013] ECLI:NL:RBONE:2013:BZ403; Appeal Court Arnhem-Leeuwarden Case 200.126.185 ABB BV, ABB Ltd v TenneT TSO BV, Saranne BV [2014] ECLI:NL:GHARL:2014:6766; District Court

Gelderland Case 208814 TenneT TSO BV, Saranne BV v Alstom and Others [2014] ECLI:NL:RBGEL:2014:6118.

77_{Branda Katan, 'Toerekening van kennis van groepsvennootschappen' (2019) 60(6) Ondernemingsrecht}

295, 301.

78_{ibid (and the cited jurisprudence and literature). See also, Bram Braat, 'Kartelschade in Nederland; een}

eerste aanzet,' (2013) Nederlands Tijdschrift voor Europees Recht 318, 321; Rick Cornelissen, Lumine van Uden, Elselique Hoogervorst, 'Parental Liability' in (eds) Elselique Hoogervorst and Others,

Kartelschade Serie Onderneming en Recht (Wolters Kluwer 2019), chpt.3.3.

79_{Case C-97/08 P Akzo Nobel NV and Others v Commission of the European Communities [2009]}

ECLI:EU:C:2009:536.

80_{Case T-587/08 [2013] Fresh Del Monte Inc v Commission ECLI:EU:T:2013:129.} 81_{Case T-132/07 [2011] Fuji Electric Co Ltd v Commission ECLI:EU:T:2011:344.}

82_{For the Dutch literature: Jeroen Kortmann, 'The draft directive on antitrust damages and its likely}

effects on national law' in (ed) Arthur Hartkamp, The Influence of EU Law on National Private Law -

General Part (Wolters Kluwer 2014), 676; Cornelissen, van Uden, Hoogervorst (n 78), 48. For an

(26)

they are part of the same "undertaking". Disproving the existence of this influence has become the only way for a parent to avoid liability.83_{This will be especially problematic}

in those cases wherein the, practically un-rebuttable, rebuttable Akzo-presumption can be invoked.84

ii. Rebuttable Presumption

Indeed, for 100% parents there exists a rebuttable presumption: the Akzo-presumption. These parents are presumed to have exercised "decisive influence" over their subsidiary.85_{Due to the Skanska-judgment, this presumption has been transposed into}

the national legal order as well. Consequently, in those jurisdictions where it was inherently difficult to prove parental liability it will now be just as inherently difficult to disprove parental liability in light of the Akzo-presumption.86_{It should, however, be}

emphasised that the Akzo-judgment brought the necessary clarity on parental liability in public enforcement procedures. A similar – EU-wide – clarity now exists within the field of private enforcement.87

III.3.e A Subsidiary's and a Sister's Liability

Additionally, Skanska's impact upon the possibility for attributing a parent's infringement upon a subsidiary – a reverse-parental liability – will be significant as well. It is not inherently so for national regimes to allow such liability. For example, whilst the German Legislature limited liability to one characterised by a bottom-upwards attribution,88_{the Dutch Courts in the GIS-Cartel damages proceedings did}

accept a reverse attribution pre-Skanska.89_{The transposition of the "undertaking" does}

83_{Carsten Koenig, 'An Economic Analysis of the Single Economic Entity Doctrine in EU Competition}

Law', (2017) 13(2) Journal of Competition Law & Economics 281, 286.

84_{Julian Joshua, Yves Botteman, Laura Atlee, '"You Can’t Beat the Percentage" The Parental Liability}

Presumption in EU Cartel Enforcement' (2012) EU Antitrust Review 3, 7-8; Whish and Bailey (n 64), 98-99.

85_{Akzo (n 79), para 61.}

86_{For a full discussion of the post-Akzo approach, see Andriani Kalintiri, ‘Revisiting Parental Liability}

in EU Competition Law’ (2018) 43(2) European Law Review 145.

87_{Erik Pijnacker Hordijk, Simone Evans, ‘The Akzo Case: Up a Corporate Tree for Parental Liability for}

Competition Law Infringements: Case C-97/08 P, Akzo Nobel and Others v Commission’ (2010) 1(2) Journal of European Competition Law and Practice 126, 127.

88_{For an extensive discussion on German Law see, Kersting (n 65), 1-7.} 89_{TenneT v ABB (n 76) ABB v TenneT (n 76); TenneT v Alstom (n 76).}

(27)

not per se solve this divergence. Indeed, it remains unclear whether EU law allows such reversed liability at all. Equally, sister liability for infringements committed by related subsidiaries is not an established legal doctrine.90

Recollecting that "decisive influence" is generally considered the doctrinal basis for liability, it is difficult to reconcile these two types of liability with this doctrinal basis. After all, almost per definition a subsidiary does not exercise "decisive influence" over a parent. The same could be said about sister companies having influence over one another. However, if the doctrinal foundation for liability is the "unity of action" and not "decisive influence" all constituent parts of the "undertaking", e.g. a parent, and a subsidiary and its sisters, are liable for the "undertaking's" infringements.91_{As the}

constitutive entities' 'joint action triggers joint liability'92_{Kersting argues that there is}

no reason not to allow either reverse or sister liability as all the constitutive entities forming the "undertaking" as an economic unit carry the "undertaking's" liability.93

Nonetheless, both types of liability will likely remain controversial. Indeed, it appears that some national courts are already struggling with these questions. Multiple Dutch courts, for example, allowed the parties involved to respond to the Skanska-judgment and, explicitly, its consequences for liability.94_{In a recent decision, however, the}

Arnhem-Leeuwarden Appeal Court implicitly applied "unity of action" as the doctrinal basis for liability. Notably so, it held that a 48% subsidiary formed an "undertaking" together with the legal successor of the "original infringing" parent company.95

Regardless, the contemporary uncertainty might be resolved. Indeed, in one of the Truck-Cartel follow-on cases, the Barcelona Appeal Court directed four questions

90_{Kersting (n 65), 5.}

91_{See discussion at footnotes 65-69.} 92_{Kersting (n 65), 24.}

93_{ibid 20-24.}

94_{Concerning the GIS Cartel follow-on cases, Appeal Court Árnhem-Leeuwarden Case 200.177.480}

Alstom and Others v TenneT c.s. TSO BV, Saranne BV [2019] ECLI:NL:GHARL:2019:3990. Concerning

the Elevator Cartel Follow-on cases, District Court Rotterdam Case C/10/547149 Stichting Elevator

Cartel Claim v Kone and Others [2019] ECLI:NL:RBROT:2019:8230.

95_{Appeal Court Arnhem-Leeuwarden Case 200.177.480 Alstom and Others v TenneT c.s. TSO B.v.,}

(28)

related to reversed-liability to the ECJ.96_{It is to be recommended that the ECJ seizes}

the opportunity to clarify, in general, the doctrinal foundation for liability and thus the issue of reversed and sister liability as well.

III.4 The Desirability of Such Uniform Regime

II.4.a In Line With Previous Developments

Despite the substantial alterations to the Member State's national liability regimes, the

Skanska-judgment was a to be expected development in the continuing Europeanisation

of private enforcement.97_{Indeed, the private enforcement field had steadily been in}

development, both in the case-law of the ECJ (e.g. Courage98_{, Manfredi}99_{and Kone}100₎

and in Union legislation (i.e. Directive 2014/104)101_{. Developments hinting at a desire}

for more uniformity and unification of a divergent field. Especially the latter indicated a move towards a uniform determination of liability, as the Directive aims to ensure the right to claim full compensation for harm from "undertakings".102_{It is therefore quite}

unsurprising that the Court in its Skanska-judgment continued its supportive approach towards the more uniform regime, which is necessary for the continuing evolution and strengthening of a claimant's right to full compensation. Even if this means that it must intervene in the Member States' rules affecting the private enforcement of EU competition law.103

96_{Order of 24 October 2019 of the Audiencia Provincial de Barcelona, Sección 15, Rollo número}

775/2019-2 Sumal v Mercedes Benz Trucks España, para. 16. For an extensive analysis see, Hans-Markus Wagener, 'And again: liability for cartel damages, (D’Kart Antitrust Blog, 15 November 2019) <www.d-kart.de/en/blog/2019/11/15/auf-ein-neues-haftung-von-konzerngesellschaften/> accessed 30 December 2019.

97_{Hans-Markus Wagener, 'Follow-up to Skanska – The 'Implementation' by National Courts So Far'}

(2019) 10 Neue Zeitschrift für Kartellrecht, 5-6 <https://ssrn.com/abstract=3455993> accessed 30 December. 98_{Courage v Crehan (n 4).} 99_{Manfredi (n 34).} 100_{Kone (n 35).} 101_{Directive 2014/104 (n 5).} 102_{ibid article 1.}

103_{Hans Vedder, 'The Kone case and the lifts cartel – an upward effect on prices and effectiveness?' (EU}

Law Blog, 19 June 2014)

(29)

II.4.b No Alternative

Furthermore, in order to achieve the by the Court (and EU legislature) desired uniformity, a less intrusive but as effective alternative was unavailable. If the ECJ solved the matter at hand by applying the principle of equivalence and effectiveness as was suggested by the third question, it would thereby have been less intrusive. Nonetheless, it is preferable in light of the uniformity of law that it did not do so. By exhaustively claiming the determination of the liable entity as a matter for EU law, the Court pre-emptively avoids any future divergent application of the right to compensation due to differences in the establishment of liability. A full transfer of ownership is therefore the more secure option in light of the injured parties' interests.104

An as effective result could not have been achieved by applying the principles of effectiveness and equivalence. As such, by requiring uniformity, the Court ensured the continued effective enforcement of EU competition law by establishing that only "undertakings" can be held liable, further strengthening the deterrent function of EU competition law, and removing the risk of forum shopping.105

III.5 Conclusions

Firstly, prior to Skanska, it was left to the member states to provide rules with which to determine what entity can be held liable. However, post-Skanska, the "undertaking" concept is to be used to determine the liable entity in private enforcement procedures as well.

Secondly, an entity is an "undertaking" if it is engaged in an "economic activity" and it can be comprised of multiple entities via the SEE Doctrine. The doctrinal foundation for liability appears to be the exercise of "decisive influence" over, and a lack of autonomy of, the controlled entity. However, it is suggested that the "unity of action" of the "undertaking" as a unit rather forms the doctrinal justification. Regardless of

104_{Guilherme Oliveira e Costa, ‘The principle of economic continuity’s application on private}

enforcement: Case 724/17 Skanska’ (EU Law Blog, 29 April 2019)

<https://europeanlawblog.eu/2019/04/29/the-principle-of-economic-continuitys-application-on-private-enforcement-case-724-17-skanska/> accessed 30 December 2019.

(30)

precise doctrinal basis, the transposition of "undertaking", accompanied by the rebuttable Akzo-presumption, nullifies the relevance of national standards for parental liability. With regards to subsidiary and sister liability, however, it does depend on the doctrinal foundation whether these forms of liability are permittable. Indeed, only "unity of actions" offers the possibility for these types of liability.

Thirdly, although this transposition significantly intrudes within the Member States' autonomy, the created uniformity was to be expected and is desirable in light of individuals' right to claim compensation. Additionally, the same level of protection could not have been achieved otherwise by the ECJ.

However, these conclusions do not reveal how internal liability is to be determined: by applying national law or by applying EU law?

(31)

Chapter IV – On the Determination of Internal Liability

IV.1 Introduction

Chapter IV establishes the framework wherein internal liability is determined.106_As

such, this Chapter answers the following sub-questions: what is the doctrine of joint

and several liability (IV.2); what is meant by the determination of one’s "relative responsibility" and why is it relevant (IV.3); is a uniform standard regarding the determination of "relative responsibility" desirable (IV.4); and does contemporary EU law allow a uniform standard for the determination of one's "relative responsibility" to be created (IV.5)?

IV.2 The Joint and Several Liability of "Co-infringing Undertakings" Per definition, a cartel is formed by multiple "undertakings" working together. Indeed, it is this cooperation that causes harm to individuals. The rules on joint and several liability, in general, allow those who have suffered damages from a cartel's activities to choose from among the co-infringers, the "undertaking(s)" from which they will require

full compensation. Hence, each of the co-infringers of EU competition law can be held

to compensate their victims' harm in full until the latter has been fully compensated. As one can imagine, this doctrine is designed to be a claimant's weapon. After all, the by the Damages Directive ensured EU-wide adoption enables the victims of competition infringements to pick and choose the defendant with the deepest pockets.107

The rules regarding the joint and several liability of "co-infringing undertakings" are well established, already existing under the pre-Damages Directive's old-regime and

106_{See definition above at page 8.}

107_{Euan Burrows, Emile Abdul-Wahab, 'To shop or not to Shop? Jurisdictional Differences Following}

Implementation of the Damages Directive: Competition Litigation 2019' (ICLG, 5 September 2018) <https://iclg.com/practice-areas/competition-litigation-laws-and-regulations/to-shop-or-not-to-shop-jurisdictional-differences-following-implementation-of-the-damages-directive> accessed 30 December 2019. Under Spanish and German law, it might de facto have been impossible to claim contribution due to civil and procedural law obstacles, see Ben Bornemann, 'Cartel Damages: Liability and Settlement' 13, 13-19 <https://ssrn.com/abstract=3208840> accessed 30 December 2019.

(32)

continuing to exist under the post-Damages Directive's new-regime.108_{However, the}

differences between the two regimes matter little as they, in general, largely correspond. It is therefore questionable whether the rules will be applied differently.109_{It could be}

argued, however, that article 11 of the Damages Directive – which reiterates the rules on joint and several liability – complicated the field by introducing generally unknown rules regarding immunity recipients.110

IV.3. The Determination of Cartel Members' "Relative Responsibility"

IV.3.a Scenarios Wherein the Determination of "Relative Responsibility" is of Relevance

i. Internal Contribution

Closely linked to the concept of joint and several liability, is the right to contribution. That is, an "undertaking's" right to claim compensation from its co-infringers for any compensation it paid by virtue of its joint and several liability in excess of its own participation. Indeed, this right as Advocate-General Mengozzi stated 'arises logically from the payment by just one person of a debt for which that person is jointly and severally liable along with others.'111_{The Advocate-General, unfortunately, did not}

entertain the inherent issues related thereto, as will be discussed below.

However – assumingly – in anticipation of such issues the Damages Directive includes a provision explicitly dealing therewith. Article 11(5) of that Directives states that the Member States must ensure that an infringer of EU competition law can recover a contribution from any other co-infringer. The height of the contribution an infringer can claim from its co-infringers, will depend on the "relative responsibility" of each

108_{Directive (EU) 2014/104 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 [2014] OJ L349/1, Explanatory Memorandum, point 4.4.3: 'the proposed Directive builds on this general rule, it introduces certain modifications with regard to the liability regime of immunity recipients' (emphasis added).

109_{Wils (n 45), 27.}

110_{For an extensive discussion regarding immunity recipients and joint and several liability, see}

Bornemann, (n 107).

111_{Joined Cases C-231/11 P and C-233/11 P European Commission v Siemens Österreich and Others}

The Final Liable Entity in Cartel Damages Cases On the contemporary determination of external liability in follow-on cartel damages cases and an argument for the uniform

Faculty of Law