The trucks cartel fined by the European Commission (‘Commission’) in 2016 and 2017 triggered a wave of follow-on damage actions throughout the entire European Union (‘EU’). In Italy, after several legal actions having been launched by logistics associations and transport companies against the six sanctioned manufacturers, the Chamber of the Naples District Court specialised in business matters (‘Court’) rendered the first sentencia awarding damages in 2021.
On 19 July 2016, the Commission found in a settlement decision (‘Decision’) that five truck manufacturers participated in a single and continuous infringement of the EU’s cartel prohibition for the period from 17 January 1997 to 18 January 2011. The infringement, which resulted in a record fine of € 2.93 billion, lasted 14 years and concerns anticompetitive conduct in relation to the supply of medium-duty (between 6 and 16 tonnes) and heavy-duty (over 16 tonnes) trucks throughout the entire European Economic Area (EEA). On 27 September 2017, the Commission also sanctioned Scania a further € 880 million for its participation in the cartel.
According to the Commission, DAF, Daimler, Iveco, MAN, Volvo/Renault, and Scania implemented unlawful practices by coordinating (i) the gross list prices for trucks, (ii) the timing of the introduction of new emission technologies (from Euro III to Euro VI), and (iii) the passing on to customers of the costs for the emission technologies required to comply with the increasingly strict emission standards.
In 2019, the claimant, a logistic company based in the province of Salerno in the Campania region, filed a damage action against Iveco s.p.a. claiming compensation in relation to the purchase of an Iveco Magirus truck from an authorized dealer in 2007.
According to the plaintiff, the anti-competitive practices resulted in an overcharge of € 21,252, calculated as a 20% overcharge rate applied to the purchase price of € 106,260 paid for the vehicle. If the Court chose not to follow this request, the Claimant, alternatively, sought the compensation to be evaluated by an expert witness or to be determined in the course of the proceedings. In all three options, in addition to damages, legal interest was requested from the date the truck was purchased.
The defendant Iveco s.p.a pleaded five main arguments against the allegations raised by the claimant.
- The five-year limitation period to claim damages has expired, since (i) the legal action was brought in 2019, when the cartel infringement ceased in 2011; (ii) the well-publicised coverage in the media of the Commission’s cartel investigation, particularly in journals specialized in the transport sector; and (iii) the cartel impacted on businesses, which for the most part, generally closely follow developments in the sector and are typically not considered as uninformed consumers.
- The case should be referred to the Court of Justice of the European Union (‘CJEU’) pursuant to Art. 267 of the Treaty on the Functioning of the European Union (‘TFEU’), since the negotiating nature of the settlement procedure did not provide the national court with significant evidence. Furthermore, Scania not having adhered to the settlement procedure and having challenged the administrative fine before the CJEU, would have made the Decision unsuitable to be relied upon by the plaintiff.
- The defendant also disputed the relevance of the settlement procedure by arguing that it did not give rise to a cartel case under Art. 101 TFEU, and did not constitute an actual exchange of information between the parties involved.
- The overcharge claimed would have allowed the plaintiff to deduct a higher cost, hence achieving tax savings. Consequentially, the claimant should not be entitled to compensation for the entire overcharge incurred, but only the net of what was already saved in terms of taxes.
- Finally, the applicability of the EU Antitrust Damages Directive’s substantive rules on the burden of proof was challenged. According to the defendant, the latter was not satisfied in line with the Art. 2043 et seq. of the Italian Civil Code on extra-contractual liability, since the plaintiff did not demonstrate the existence of a causal link between the practices established in the Decision and the damages claimed.
Judgment by the Naples District Court
In its judgment of 29 June 2021, the Court ruled the following.
- The defendant’s argument, according to which the plaintiff’s claim was time-barred, is unfounded. It neglects the fact that only in 2016, with the agreed settlement, was it possible to be aware of the infringement. This is a fundamental requirement, regardless of whether the damage occurred to a business or final consumer. Thus, only from the date of the decision the claimant could have knowledge of damages suffered. Furthermore, in the opinion of the Court, it should be noted as well that, among the same press releases submitted by the defendant, the Commission itself stated that the start of the cartel investigation did not necessarily mean that the undertakings were “guilty”.
- In relation to the request for a preliminary referral to the CJEU, the Court recalls that the settlement procedure is an agile tool, an alternative manner of resolving disputes, foreseeing the direct participation of the companies accused in protracted negotiations and talks (as happened in the case at issue), with the final acceptance (with the exception of Scania) of the financial penalties proposed. Nevertheless, this solution does not present any breach of defensive guarantees for the parties involved. As a result, the Court does not consider the settlement procedure as an instrument less effective or valid than a contested sanction to warrant a preliminary referral to the CJEU.
- In relation to the defendant’s argument that the burden of proof as set by the EU Antitrust Damage Directive collides with the articles of the Italian Civil Code on the so-called “responsabilità aquiliana”, and as such the Court should refer to the legislative decree implementing the EU Antitrust Damage Directive into the Italian legal system, the Court ruled that the claimant acted as an indirect buyer, since it complained of having suffered a damage which occurred higher up the distribution chain causing a price increase to the detriment of the market level of the direct purchaser, i.e. the plaintiff was claiming a damage which was passed on from the authorized dealer.
Notwithstanding the general provision referred to in Art. 2043 et seq. of the Italian Civil Code, in order to make effective the exercise of the right to compensation for damages due to a violation of competition law, the Italian legislative decree also recognizes the presumption which assumes the passing-on (from the direct to the indirect purchaser) as proven, shifting the burden of proof to the defendant.
- In this context, the defendant did not prove that the overcharge, in whole or in part, was not passed on or transferred downstream to the indirect purchaser but limited itself to arguing that the claimant would not have been entitled to compensation of the entire overcharge, only for a part of it due to tax savings.
- The Court attempted to quantity the damages suffered by the claimant by means of an expert witness. However, the expert witness referred back to the Court the determination of the damages on an equitable basis for solution that the latter can resort to whenever, albeit using estimations to prove the existence of a damage causally connected to an anticompetitive offense if it is impossible to prove the same with an exact quantification.
As a result, the Court:
- estimates 15% overcharge (i.e. € 11,550) on an equitable basis after deducting the VAT paid (i.e. 20%) from the purchase price of the truck;
- recognizes legal interest from the date of filing of the claim;
- establishes that both legal fees and expenses for the expert witness must be jointly borne by the parties, “as this is an extremely complex and debated issue and in relation to which, as far as the Court is aware, there are no jurisprudential precedents”.
The judgment may appear simplified in some respects, e.g. as (i) the claimant having purchased from a dealer is considered as an indirect purchaser, although damages in such scenario according to the CJEU in Tibor-Trans (judgment of 29 July 2019, Case C‑451/18) have to be considered as an “immediate consequence” of the infringement, (ii) legal interest is recognized only from the date of the claim, and not from that of the harm, as follows from the CJEU in Manfredi (13 July 2006, Cases C-295/04 to C-298/04); and as (iii) court fees have to be paid by both parties, and not exclusively by the defendant. However, the Court has managed to ascertain the existence of a damage within a relatively short period of time (i.e. less than two years). As a result, taking into account the legal and economic challenges that such a case presents, the judge has thus opted for a pragmatic and result oriented approach.
By Dr Danilo Samà