Compensation for Antitrust Violations in the Italian Legal System: Probative Value, Damage Quantification Criteria, and Jurisdictional Competence

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Introduction

The Italian legal system provides a crucial mechanism for compensating parties harmed by anti-competitive practices, including cartels, abuse of dominant position, and other conduct that violates competition law. This mechanism serves an important function in protecting the interests of those adversely affected by such practices. In Italy, such actions are governed by civil law, yet they intersect with decisions made by antitrust authorities, such as the Italian Competition Authority (hereinafter referred to as "AGCM"). These authorities play a crucial role in determining the existence of violations.

Probative Value of Antitrust Authority Decisions in the Italian Context

In Italy, decisions by antitrust authorities, such as the AGCM, that establish a violation of competition law are of significant probative value in civil proceedings for damages. In particular, Italian legislation, in accordance with Directive 2014/104/EU, transposed by Legislative Decree No. 3 of 19 January 2017, stipulates that infringements established by a national competition authority are to be regarded as conclusively proven for the purpose of civil compensation claims. This principle confers binding effect upon AGCM decisions in civil courts, thereby reducing the necessity for the issue of the violation to be re-examined during civil proceedings.

This probative value simplifies the process for the injured party, who is no longer required to prove the existence of the violation but can instead focus on demonstrating the damage suffered and the causal link between the violation and the economic harm. However, the antitrust authority's decision does not exempt the injured party from the burden of proving the extent of the damage and the causal connection to the violation, which can still present significant challenges, especially in the absence of clear damage quantification.

Criteria for Damage Quantification and Simplifications in Cartel Cases

The process of quantifying damages resulting from antitrust violations is typically complex, as it necessitates the reconstruction of a counterfactual scenario. This is defined as the economic situation that would have materialised in the absence of the violation in question. Nevertheless, in instances of price-fixing cartels, the process of quantifying damages may be comparatively less complex than in other instances of antitrust violations. In such cases, the damage often takes the form of an overcharge paid by consumers or businesses due to the collusive agreement among cartel participants.

In particular, the damages incurred can be calculated by comparing the actual price paid with the price that would have been paid in a competitive market. Although this type of analysis still necessitates technical expertise, it is more straightforward than in other situations where the damage is less evident or more challenging to isolate. To illustrate, in instances of price-fixing cartels, the immediate consequence of the infraction is the artificial elevation in prices, which renders it more straightforward to ascertain the injury sustained by those who procured goods or services at augmented costs.

Nevertheless, even in these instances, certain challenges may emerge. For example, it may be challenging to ascertain the precise amount of the overcharge paid, particularly in complex markets or instances where prices are influenced by multiple factors. Furthermore, the quantification of damages may be complicated by the necessity to account for the pass-on of the overcharge along the distribution chain. In some cases, the overcharge may have been passed on to final consumers, which would serve to reduce the damage suffered by intermediate businesses.

Joint Liability of Cartel Participants

A significant aspect of cartel cases is the potential for seeking damages not only from the company with which the injured party had business dealings, but also from all companies participating in the cartel. This principle is based on the collective nature of the liability of companies involved in a cartel. In such cases, all companies participating in the anti-competitive agreement are jointly and severally liable for the damage caused, regardless of whether the injured party had direct dealings with all or only some of them.

In other words, the injured party is entitled to seek compensation from any cartel participant, even in the absence of direct commercial relations with that company. This principle is based on the premise that all companies involved in the cartel contributed, through their collusive conduct, to the distortion of the market and the consequent harm to consumers or other businesses. Consequently, each company can be held liable for the entire damage suffered by the injured party, leaving the cartel participants to seek recourse among themselves through contribution actions.

Competent courts for antitrust claims in Italy

In Italy, actions for damages arising from antitrust infringements can be brought before ordinary civil courts. The territorial jurisdiction depends on the place where the damage occurred or on the domicile of the defendant. However, in the case of civil disputes relating to competition law infringements, the law provides that these cases should be brought before courts with specialised sections for commercial matters, the so-called "Tribunali delle Imprese". These specialised commercial courts are located only in the the main Italian cities and have exclusive jurisdiction over any disputes pertaining to competition, company law and intellectual property.

Statute of Limitations for Antitrust Compensation Claims

In the context of antitrust violations, the statute of limitations for initiating a compensation claim is five years. Nevertheless, the starting point for the limitation period may differ depending on the circumstances. In particular, the limitation period commences upon the moment the injured party becomes aware, or should have become aware, of the violation and the damage sustained.

In follow-on actions, that is to say, those that follow a decision by an antitrust authority, the statute of limitations may only commence on the date on which the AGCM's decision becomes final. This enables those who have sustained losses as a result of anti-competitive practices to pursue compensation claims even several years after the violation occurred. This is because such practices are often only uncovered following lengthy and complex investigations.

Conclusions

The compensation of damages resulting from antitrust violations in the Italian legal system, particularly in cases of price-fixing cartels, represents a crucial instrument for the protection of businesses and consumers who have sustained harm as a consequence of anti-competitive practices. The probative value of decisions by antitrust authorities, such as the AGCM, facilitates compensation claims. Furthermore, the collective liability of cartel participants allows injured parties to seek damages from any of the companies involved, regardless of direct commercial relations. However, the quantification of damages and the determination of the statute of limitations can present challenges that require careful legal and economic analysis. 

Stefano Brustia - Lawyer at the Rome Bar