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The Future of the Statute of Limitations for Antitrust Damages Claims in Europe

Katharina Kolb

The Future of the Statute of Limitations for Antitrust Damages Claims in Europe
honglouwawa via Getty Images

In June 2022, in the case Volvo/DAF, the European Court of Justice had last commented on what European primary law means for national limitation laws in cartel damages cases at the occasion of a Spanish damages case resulting from the European truck cartel. In September 2023, in the case Heureka/Google Shopping, the Advocate General at the European Court of Justice not only addressed the question of the applicability of the provisions on the statute of limitations in the European Cartel Damages Directive, but discussed in particular how national law applicable to claims that have arisen before the implementation of the Directive is to be interpreted in light of European primary law.

The opinion of Advocate General is based on a request for a preliminary ruling from a civil court in Prague that has to decide on the follow-on action for damages brought against Google Shopping by the Czech comparison platform Heureka. According to the relevant decision of the European Commission, Google had abused its dominant position in the Czech Republic from February 2013 to June 2017. The Damages Directive, which was to be transposed into national law by December 26, 2016, was not implemented in the Czech Republic until September 2017. Prior to the implementation of the Damages Directive into Czech law, a three-year subjective limitation period from the time of knowledge of the damage and the debtor was applicable in the Czech Republic.

The Advocate General re-iterates in her opinion that

  • the rules on the statute of limitations in the Cartel Damages Directive are substantive law and are therefore only applicable from the date of the transposition of the Directive into national law;
  • national law must be interpreted in the light of the Cartel Damages Directive for claims that have arisen between 27 December 2016 and the actual transposition of the Directive into national law, unless such interpretation would be contra legem, which the Advocate General did not assume (for Czech law), and
  • for the period prior to the expiry of the transposition deadline on 26 December 2016, national law is applicable, but must be applied and interpreted in the light of Article 102 of the Treaty on the Functioning of the European Union (TFEU) and the principle of effectiveness.

The European law principle of effectiveness requires national laws to not render it excessively difficult or practically impossible to claim damages following infringements of competition laws. The Advocate General concludes that the principle of effectiveness precludes national rules which allow the limitation periods for cartel damages claims to commence before the competition law infringement as a whole has ceased and before the injured party has or ought to have had knowledge of the information relevant to bringing an action, including the existence of the infringement of competition law.

Should the European Court of Justice follow the Advocate General's opinion – which seems likely given that it had already made a similar statement obiter dictum in the case Volvo/DAF – the issue of absolute limitation periods that start to run irrespective of knowledge (e.g. the absolute (ten years) statute of limitations for cartel damages claims pursuant to Section 199 (3) no. 1 of the German Civil Code or Section 33h (3) of the German Act against Restraints of Competition or the absolute (twenty years) limitation period pursuant to Article 2232 of the French Civil Code) will belong to the past.

In German legal literature, some authors emphasized that the ECJ decision in Volvo/DAF referred to subjective (Spanish) limitation periods and did not make any statement on the unlawfulness of (German or other) absolute limitation periods under European primary law. One could of course also argue that the Advocate General's Opinion in Heureka/Google Shopping refers to subjective (Czech) limitation periods and does not relate to (the theoretically long German or French or other) absolute limitation periods.

In fact, however, the ECJ and now also the Advocate General have stated quite generally that national limitation periods for antitrust damages claims cannot begin to run before the infringement has completely ceased and the injured party has obtained knowledge of all facts relevant to bring a claim. In the relevant statements of the ECJ and the Advocate General, there are no indications that the point in time of the beginning of an absolute limitation period for cartel damages claims could in principle be assessed differently than the point in time of the beginning of a relative limitation period. Thus, it is stated very generally in para. 95 of the Advocate General’s opinion:

"The question raised is therefore whether, under those rules, even before Directive 2014/104, the limitation period for bringing an action for damages for an infringement of competition law should not have begun to run before such an infringement had ceased."

The Advocate General provides the following reasoning for her findings:

  1. First, the Advocate General states in para. 106 of her opinion that an action for cartel damages is structurally very different from an ordinary civil action for damages: "However, an action for damages for an infringement of competition law such as that at issue in the main proceedings is structurally different from a traditional civil action for non-contractual liability." The bringing of an action for damages would require a complex factual and economic analysis, which is made even more difficult by the asymmetry of information between the cartelists on the one hand and the injured parties on the other. National statutes of limitation would therefore have to be adapted to the specificities of competition law. We should therefore also expect that there will likely be further discussion on the necessity of a special procedural law for cartel damages actions in the future.
  2. In addition, the Advocate General states that having the limitation period start to run only upon the complete termination of the infringement is necessary in order to ensure the right to full compensation. Knowledge of the infringement and of the damage before the end of the infringement is hardly reliable, in particular, the damage can hardly be reliably determined beforehand and the requirement of an ongoing lawsuit (or an extension of the lawsuit) in the case of an ongoing infringement can make it practically impossible for victims to obtain full compensation. Only the combination of a termination of the conduct and the knowledge of the injured party of all relevant circumstances would, according to the Advocate General, allow for a reliable determination of the beginning of the limitation period in the interest of the injured party and also in the interest of the cartelists.
  3. Moreover, the Advocate General correctly finds that there would be no reason to place the victim in a worse position than the European Commission, which, pursuant to Article 25 (2) of Regulation 1/2003, also benefits from a limitation period for the prosecution of single and continuous infringements that only begins to run upon termination of the infringement.
  4. In contrast to the European Commission, for which an objective limitation period runs pursuant to Article 25 (2) of Regulation 1/2003, a subjective, knowledge-based limitation period must apply to the victims of competition law infringements who do not benefit from public-law powers of investigation. Sufficient knowledge exists in principle only from the publication of the summary of the decision of the European Commission, unless there are other clear circumstances from which it can be concluded that a diligent party could not reasonably have been unaware of the circumstances giving rise to the competition law infringement and allowing to bring an action for damages.

When practitioners mention a decision of the European Court of Justice on the conformity with European law of absolute three-year limitation periods for the assertion of length-of-service salary increments against this view, this obviously ignores the specificities of cartel damages law. In fact, whenever the European Court of Justice has dealt with limitation periods that do not depend on knowledge, it has, apart from such exceptional cases, regularly come to the conclusion that a commencement of the limitation period before the possibility of knowledge violates the European principle of effectiveness, for example in the case of consumer claims based on unfair clauses in T&Cs (see e.g. ECJ, judgment of April 22, 2021, case C-485/19, para. 61 et seq.; ECJ, judgment of July 9, 2020, case C-698/18, C-699/18, para. 65 et seq.).

An argument for timely legal peace does not have merit either if, in particular in the case of old and long-running cartels, the claims from the later phase of the cartel that are not yet time-barred are discussed in court anyway. Principally cutting off claims from the initial phase of such long-lasting cartels does not serve legal peace, but would rather only reduce the liability of the members of the cartel.

It is correct that the European legislator recognizes absolute limitation periods in principle. However, as also follows from recital 36 of the Cartel Damages Directive, absolute limitation periods are only possible "provided that the duration of these absolute limitation periods does not make it practically impossible or excessively difficult to exercise the right to full damages." An absolute ten years or twenty years limitation period, for example, may seem "long" in theory, but it is often too short in practice, in particular if it can expire while the infringing conduct is still ongoing or even before the competition authority has begun its investigations.

The ECJ has already implicitly applied the same principle in the Cogeco case. Admittedly, the case concerned a short three years Portuguese limitation period. Nevertheless, the ECJ found national statutes of limitation that could lead to the expiry of the limitation period even before the conclusion of the authority’s investigations to be incompatible with European primary law.

With a decision of the ECJ in Heureka/Google Shopping that follows the opinion of the Advocate General, courts in various pending cartel damages litigation proceedings will have to make the dogmatic decision (1) to interpret their national absolute limitation periods in conformity with European law to the effect that a claim does not arise e.g. at the time of purchase of the cartelized good but only upon termination of the competition law infringement and knowledge of the injured party of the relevant circumstances, (2) to leave the national absolute limitation periods unapplied or (3) to assume an interpretation contra legem and to refer the injured party to a state liability claim.

In any case, it is to be expected that the European Court of Justice will still have to deal with the relevant specific national absolute limitation periods in the context of further requests for preliminary ruling. This is because cartel participants will until then continue to take the position that statements of the European Court of Justice in connection with Portuguese, Spanish and Czech limitation periods have no relevance in cartel damages litigation in other European jurisdictions.