Private enforcement of competition law in the EU

An antitrust conversation with… Richard Whish QC

Video | November 2016 | 00:06:34

Video Details

Private enforcement of competition law in the EU

Peter Scott: Richard, thank you very much for coming in to talk to us about the state of private enforcement of competition law across the EU. I would like to start by asking you a general question about the state of competition litigation at an EU level, particularly as the Damages Directive is set to be introduced by the end of the year in all Member States. And whilst I expect you would say it will make more of a difference in some countries than it will in others, I would be interested to know your view as to progress and the impact generally you think it will have?

Richard Whish: Well, yes, I think it will have an impact. It seems to me that the days of private litigation in competition law are absolutely, firmly rooted throughout the EU now. Clearly, there are some Member States that have to do a lot more than others in order to make the damages action feasible and attractive. We know that England, Wales, the Netherlands and Germany are very much up and running, they are efficient systems. I’m seeing much more evidence that litigation in other countries, certainly in France, Italy and Spain, it seems to be quite normal now for there to be damages claims. And I also see, I don’t systematically follow this, but I keep on seeing press releases that a draft bill has been introduced in Parliament. I think it was Denmark the other day. So, it is clearly happening and I can only see more litigation in the future rather than less.

Peter Scott: Richard, as the, let’s say, standard of private enforcement that we can expect across the EU generally increases through the damages directive, what affect do you think Brexit will have on the status of the UK? Particularly, as you say as Germany and the Netherlands are sort of hard on the UK heels as an attractive forum.

Richard Whish: Well, as a portion of cases in the future, as opposed to the mere raw number. But as a proportion of damages claims, I can only foresee that the UK’s market share will decrease. I can’t see any circumstances in which its going to increase. And I think it’s a very regrettable turn of events and it’s just one of the logical consequences of Brexit. I mean in particular, a foreign claimant who currently has a choice of jurisdiction under the Brussels Regulation, is bound to take into account the fact that, we, post 2019, will not be a Member State of the EU. I mean, just at a physiological level, there would be something slightly odd about bringing an action based on Articles 101 and 102 in a country where those laws don’t even have the force of law. Furthermore, where quite possibly a Commission Decision finding an infringement will not have binding effect. So, it seems to me this inevitably have an effect on the proportion of damages claims brought in the UK.

Peter Scott: So, Richard, turning to the UK and looking at the two particular mechanisms introduced to allow for more effective redress for both small businesses and consumers. A fast track case to get claims heard within just six months and, more controversially perhaps, the “opt-out” class actions system. What’s your view on the effectiveness of those two mechanisms?

Richard Whish: Well, let’s take the “opt-out” mechanism first. We have now got two cases: the mobility scooter case and the MasterCard interchange fee case. Very different of course in terms of the quantum being claimed. But I suppose that the sensible answer is it is too soon to tell how effective these claims are because they have only just recently started. So in a way, this is a conversation to be had in a year’s time. But I suppose I’m slightly surprised that we’ve got two such claims so early in the history of the legislation. I wasn’t anticipating that, something like mobility scooters almost seems like a textbook example of something suitable for “opt-out” collective action. There’s no question of pass-on, one assumes that pensioners do not buy mobility scooters in bulk and sell them onto their own customers, so its entirely consumed by an individual that seems to be a perfect example of the circumstances in which one would want there to be collective claims. As for the fast track procedure, I always thought, and I’m fortified by what I have seen since, that this will somehow change access to justice. These are cases, and I think there have been four of them, three of them, something like that now which would never have satisfied the CMA that the case was within their enforcement priorities. Yet, there is a fast track procedure in the CAT which has a door open and waiting. And, of course, remedies have already been achieved in some of these cases. ;So, I think that is a very significant change in legal practice in the UK.

Peter Scott: It’s striking that I think the first two fast track cases that were brought were actually settled before they were actually allocated to the fast track. I think that perhaps that is an indication, as you say, of the fact that when you are on the defence side of a fast track case you need to take a view quite quickly on whether you are going to fight this with all the evident publicity, time, and effort.

Richard Whish: The time, the money and the publicity indeed, absolutely.

Peter Scott: Or whether you’ll decide it’s not worth the fight and settle quickly...?

Richard Whish: As I say, I always thought it would change competition practice and it would change the way in people strategize their complaints. I think it’s a very significant change.

Peter Scott: Richard, thank you very much indeed.

The private enforcement of competition law across the EU and the potential impact of the Damages Directive on competition litigation. We also highlight the UK’s two newest litigation mechanisms: opt-out class actions and the fast-track procedure.