Cartel damages after price fixing: causation, limitation and passing-on

Article 101(1) TFEU covers agreements between undertakings, decisions by associations of undertakings and concerted practices which may affect trade between Member States and have the object or effect of restricting competition. Price fixing is expressly listed. National rules may also apply to conduct that is limited to one country.

Public enforcement by a competition authority and a private damages action pursue different objectives. The authority enforces the rules in the public interest. The private claim seeks to compensate the particular economic loss. Directive 2014/104/EU states that anyone harmed by an infringement should be able to seek compensation, without requiring a prior authority decision in every case.

The existence of an authority decision nevertheless affects the evidential position. A final finding may establish the infringement or its duration. It does not automatically show which purchaser paid which overcharge or which competitor lost which order. That individual connection must still be demonstrated.

The relevant link is not simply “there was a cartel, therefore there was a loss”. The claimant must show how the conduct affected the actual price, sales opportunity or other economic position. For a purchaser, the purchasing period, product, supply level and price may be decisive. A competitor needs a plausible comparison with the development that would have occurred without the coordinated conduct.

The directive leaves national causation rules in place, but requires effective enforcement of the EU right to compensation. This does not mean that every economic decline is recoverable. Other causes such as changes in demand, supply shortages, the claimant’s own capacity limits or an independent price trend must be considered.

For the first review, list each affected transaction with date, quantity, supplier, price and payment record. Competitors should also organise customer movements, lost orders, capacity, offers and comparison periods. A clear timeline is often more useful than an unannotated collection of invoices.

The loss may look different depending on the claimant’s position. A purchaser may claim an overcharge or consequential loss. A competitor may claim lost profit or another proven financial disadvantage. Under the directive, full compensation covers actual loss and loss of profit and generally interest, but it must not result in overcompensation.

A damages estimate often compares the actual price or result with a plausible counterfactual without the infringement. Periods before or after the infringement, other regions, unaffected products or comparable markets may provide information. No comparison is automatically correct. The choice, quality and differences in the data must be explained.

The directive recognises the information imbalance in competition disputes. Subject to conditions, national courts may order disclosure of relevant evidence. This is not a licence for unlimited fishing expeditions. Necessity, proportionality, confidentiality and a plausible showing of loss remain important limits.

Passing-on means that a purchaser transferred all or part of a cartel overcharge to its own customers. It can affect the remaining loss. It does not automatically eliminate the claim and does not automatically create a claim for every later purchaser. Purchasing, resale and the actual market response must be assessed together.

A resale price increase alone does not answer the question. It may matter whether the affected quantities were resold, whether customers reacted to the price change, whether margins changed and which substitutes were available. A business may pass on part of the overcharge and still suffer a remaining loss or lost profit.

The relevant records link supplier invoices, own price lists, sales data, quantities, discounts, margins, customer reactions and market developments. A blanket assertion that the loss was passed on is as unhelpful as the opposite assertion that passing-on was impossible. The economic chain must be modelled in a traceable way.

Directive 2014/104/EU requires a limitation period of at least five years for competition damages claims. The period may not begin before the infringement has ended and the injured party knows or can reasonably be expected to know the conduct and its infringement, the existence of harm and the identity of the infringer. The exact calculation must be checked under the applicable national law.

A competition authority investigation may matter for limitation. The directive provides for suspension or interruption while the authority investigates and for an appropriate period afterwards. Consensual dispute resolution may also affect the time analysis. Preserve announcements, decisions, service dates and claim letters with their dates.

Limitation of an injunction claim under section 20 UWG is not the same question as limitation of cartel damages. An ongoing authority investigation does not replace an individual limitation review. Delayed organisation can also lead to the loss of useful comparison data and evidence.

For the first legal review, the file should separate the alleged infringement, the claimant’s market role and the affected transactions. Add contracts, invoices, price lists, orders, delivery records, internal calculations, sales data and relevant communications. Record where each file came from and whether it has been altered after creation.

If an authority decision exists, include the decision, public summary and period covered. That still does not amount to a completed damages calculation. Note separately which facts are established, which assumptions support the counterfactual and which data are still missing.

The topic page on damages after a competition violation explains the unfair-competition damages context. The article on section 16 UWG and lost profit concerns a different legal basis. Where several parties are involved, the article on multiple responsible parties may provide a separate point of comparison.