The Presumption and Quantification of Harm in the Damages Directive and the Practical Guide

Abstract

One of the beneficial innovations for claimants introduced by the EU Competition Damages Directive is the rebuttable presumption of harm in cartel cases enshrined in Article 17(2). Especially for follow-on claimants, i.e. claimants who base their case on a cartel case that has already been brought successfully by the European Commission or by a national competition authority, the presumption of harm will be of the greatest utility. Not having to prove the infringement, nor that the cartel has resulted in some harm, will leave them with the need to only show loss, causation and quantum. Stand-alone claimants will need to prove the infringement of EU (or national) competition law in addition to that.

The estimation of the quantum of damages in competition law cases can be costly in terms of time, effort and resources, due to the complexity of the economic data and the methods of transforming it into legally meaningful indicators of damage. The estimation is also inherently speculative, since it involves a counterfactual. Although the existence of harm and its quantification are two distinct elements of a successful claim for damages, the benefits from the former depend to a great extent on the latter. This was realised by the drafters of the Directive, who included in Article 17 an obligation on national courts to estimate the harm and an option for national competition authorities to assist in its calculation.

In this paper, I discuss the relationship between the presumption of harm and its quantification, and by extension also the relationship between the Damages Directive and the Practical Guide on Quantifying the harm.

As shown in the paper, it is doubtful that the presumption of harm in cartels will make much practical difference in the case law. The positive impact will instead come from the national courts’ power to estimate the harm, and the national competition authorities’ possibility to assist therewith.