A new Belgian law aiming at facilitating damages claims for competition law infringements
The Belgian law of 6 June 2017 (hereafter, the “Law”) transposes the ‘Damages Directive’ (Directive 2014/104/EU ), which aims to boost private enforcement of competition law in the European Union (“EU”) by guaranteeing that victims of competition law infringements can effectively introduce claims in the national jurisdictions of the Member States. The purpose of the Law is to remove some of the obstacles that claimants experience, such as proving the competition law infringement and calculating the damages caused. The Law implements the rules into the Belgian code of economic law (“CEL”).
The right to a full compensation
First, the Law confirms that every physical person or legal person that suffered damages due to a competition law infringement has the right to a full compensation. Claimants do not need to prove a direct contractual relationship with the infringer, and can file a claim regardless of whether the infringement was established by a competition authority. Claimants can choose to file a suit through the class action procedure (only for consumers).
Cartel infringements are presumed to cause harm, though the infringer has the right to rebut that presumption. This presumption is limited, as it does not exist for other anti-competitive conduct (for example abuse of dominance). However, the presumption is a crucial advantage for claimants as now the burden of proof is borne by the infringer.
Collecting evidence made evident?
Most claimants do not have access to the necessary evidence to base their claim upon. On the basis of the new Article XVII. 74 CEL, national courts are able to order the defendant or a third party to disclose information. A similar provision already existed under Belgian law in the Code of Civil Procedure (art. 877), but the type of evidence for which the disclosure can be ordered within the framework of the Damages Directive is broader than the general Belgian provision.
However, the requesting party must specify the items of evidence or the relevant categories of evidence as precisely as possible.
The disclosure of evidence must in each case be proportionate, which means that courts can only order the disclosure of relevant evidence when there is a plausible assertion that the claimant suffered harm from the infringement. Courts must also give adequate protection to confidential information, such as business secrets, by limiting the use and access (only to certain people) of the disclosed evidence.
Claimants can – under certain conditions – ask to disclose evidence that is included in the file of a competition authority.
Courts can impose a penalty payment upon a party, a third party or a legal representative (including lawyers), varying from 1.000,00 EUR to 10.000.000,00 EUR in case of failure or refusal to disclose the evidence as ordered by the court, destruction of relevant evidence, failure or refusal to protect confidential information or in case limitations on the use of the disclosed evidence were not respected. These sanctions co-exist with the system of the non-compliance penalty (‘astreinte’/’dwangsom’) that already exists under Belgian law.
Courts can draw a negative conclusion from a refusal to comply and judge the dispute in the disadvantage of the non-compliant party.
Under the new rules, a defendant can invoke the fact that the claimant(s) passed on the “overcharge”, the difference between the price paid and the price that would have been paid in the absence of an infringement. The burden of proof of this passing-on remains with the defendant.
Joint and several liability
The injured party has the right to require full compensation from any of the undertakings that infringed competition law through joint behavior. There are two exceptions to this rule:
- First, under certain conditions, the SME’s (as defined in Commission Recommendation 2003/361/EC) are only liable to their own direct and indirect purchasers;
- Second, the immunity recipients (i.e. undertakings that have been granted immunity from fines under a leniency programme), are only liable to their direct or indirect purchasers or providers.
The SME’s and immunity recipients are also liable to other injured parties only where full compensation cannot be obtained from the other undertakings that were involved in the same infringement of competition law.
It should be emphasized that the Law is stricter for SME’s than the Damages Directive, as the Damages Directive does not provide explicitly that SME’s can be liable to other injured parties. Regarding the liability of SME’s, the Belgian law goes beyond the Damages Directive in order to have a more uniform law and because of the wording of the provision in the Damages Directive (“without prejudice to the right of full compensation”, art. 11.2 Damages Directive).
The infringer who paid can recover contributions from the other infringers according to their relative responsibility.
Suspension and limitation periods
Courts can suspend their proceedings for up to two years when parties are involved in consensual dispute resolution in order to reach a settlement.
The new law also states that the general limitation periods apply: ten years for contractual claims and five years for tort claims.
Filing an action for damages for infringements of antitrust law becomes more victim-friendly with this new law, as it tackles some of the practical issues that claimants may experience. It will be interesting to learn how the new rules will impact the practice of antitrust litigation, and to what extent it will lead to more damages claims.
Marc Picat Clément Claesens