Competition law private damages cases are becoming more predictable

The Court of Justice of the European Union facilitates the process of bringing claims for damages in cases of infringements of competition law.

The judgment of the Court of Justice of the European Union (hereinafter – "CJEU") of 24 October 2018 in Case C-595/17 Apple Sales International and Others v. MJA facilitates the process of bringing claims for damages in cases of infringement of competition law.

Within the context of the case, the CJEU resolved the question, whether an exclusive jurisdiction clause contained in the agreement, which did not expressly mention competition law disputes, covers disputes concerning damages resulting from abuse of a dominant position? Namely, in accordance with the factual circumstances in the eBizcuss case, where in 2012 the former reseller of Apple products in France, eBizcuss, brought a claim for damages against Apple before the French courts alleging abuse of a dominant position. Apple, on the other hand, referred to the exclusive jurisdiction clause contained in its agreement with eBizcuss, which very generally established that the Irish courts were to have jurisdiction in the event of any dispute arising out of the agreement.

This particular case is significant in view of the fact that in 2015, in the so-called Hydrogen Peroxide damages case (Case C-352/13), the CJEU established that the exclusive jurisdiction clauses that do not expressly mention competition law disputes shall not be applicable to disputes concerning damages resulting from a cartel.

However, at the initiative of the Court of Cassation of France (Cour de Cassation), the CJEU made a preliminary ruling establishing that exclusive jurisdiction clauses that do not expressly state that competition law disputes are subject to courts of a particular jurisdiction do in fact cover cases relating to abuse of a dominant position. Consequently, the current legislation provides for contradictory interpretation of disputes relating to damages resulting from the abuse of a dominant position or a cartel.

The new finding by the CJEU is particularly essential to market participants who are or might be in a dominant position in a specific market and engage in legal transactions with market players in upstream or downstream markets of other EU Member States. Undeniably, these legal relationships are subject to a specific contractual framework in which the parties stipulate to a procedure for resolving potential disputes. Given the novelty of these findings, it can be concluded that the currently existing agreements most likely haven’t been prepared using a risk analysis that covers risks associated with potential infringement of competition law. Accordingly, it can be concluded that it is essential to re-evaluate the dispute resolution procedures outlined in the existing agreements in order to minimize the potential negative risks that may arise from not stipulating to dispute resolution before the courts of other Member States of the European Union.

by Jānis Sarāns, Associate, Latvia

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