CAR­TELS ARE PART OF THE STORY

Business Day - Business Law and Tax Review - - BUSINESS LAW & TAX REVIEW -

com­pen­sa­tion when there has been harm suf­fered, but it is equally im­por­tant for there not to be dou­ble li­a­bil­ity on a party to a cartel.

There has not been a for­mal civil dam­ages award pur­suant to the Com­pe­ti­tion Tri­bunal find­ing a firm guilty of cartel con­duct in SA.

There are sev­eral dif­fi­cul­ties that a party wish­ing to claim civil dam­ages as a re­sult of cartel be­hav­iour, for ex­am­ple price fix­ing or bid rig­ging, could face.

These dif­fi­cul­ties re­late to the dif­fi­culty vic­tims ex­pe­ri­ence to draw a suf­fi­ciently close link to the harm suf­fered and the an­ti­com­pet­i­tive con­duct; the dif­fi­culty vic­tims ex­pe­ri­ence to ob­tain ev­i­dence re­quired to sup­port their claim; the dif­fi­culty of quan­ti­fy­ing cartel be­hav­iour; and the lack of funds or mech­a­nisms avail­able to con­sumers and small-medium en­ter- prises in seek­ing re­dress.

To make it eas­ier for al­leged vic­tims of an­ti­com­pet­i­tive con­duct to claim civil dam­ages, the Euro­pean Union (EU) re­cently an­nounced cer­tain re­forms in com­pe­ti­tion law.

The re­forms bring about con­sid­er­able changes to com­pen­sa­tion for vic­tims of col­lu­sion.

The re­forms in­clude col­lec­tive re­dress mech­a­nisms aimed at en­abling in­di­vid­ual vic­tims of col­lu­sion to claim col­lec­tively to cir­cum­vent the usual risks, costs and de­lays that are in­volved in civil lit­i­ga­tion.

In this re­gard, the two re­dress mech­a­nisms pro­vided for are the rep­re­sen­ta­tive ac­tion, and the opt-in col­lec­tive ac­tion where in­di­vid­ual vic­tims of an­ti­com­pet­i­tive be­hav­iour could de­cide to com­bine their claims to­gether into one ac­tion.

Dis­clo­sure of ev­i­dence is a ma­jor is­sue most vic­tims of col­lu­sion strug­gle with when con­sid­er­ing claims for dam­ages. This could be seen as the rea­son why the EU re­forms pro­vide for an obli­ga­tion on de­fen­dants to dis­close hard-to-find ev­i­dence which in­cludes giv­ing vic­tims of car­tels more time in pre­par­ing their case.

A fur­ther re­form re­lates to quan­tifi­ca­tion of harm, which re­lieves vic­tims of the pre­vi­ously heavy ev­i­den­tiary bur­den, as it places a re­but­table pre­sump­tion in favour of the vic­tim that harm has oc­curred.

In­deed the EU re­forms low­ered the hur­dle in re­la­tion to par­ties want­ing to claim dam­ages and it needs to be seen whether these re­forms would in­crease the num­ber of civil dam­ages claims as well as class ac­tions that fol­low in­ves­ti­ga­tions and suc­cess­ful pros­e­cu­tions for cartel be­hav­iour in the EU.

Dis­clo­sure of ev­i­dence is a ma­jor is­sue most vic­tims of col­lu­sion strug­gle with when con­sid­er­ing claims for dam­ages

Pic­ture: iS­TOCK

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