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Part A Normative Approach to Consumer Participation, 3 Normative Justifications for Increased Consumer Involvement

From: Consumer Involvement in Private EU Competition Law Enforcement

Maria Ioannidou

From: Oxford Competition Law (http://oxcat.ouplaw.com). (c) Oxford University Press, 2015. All Rights Reserved. Subscriber: null; date: 27 October 2020

(p. 47) Normative Justifications for Increased Consumer Involvement

1.  Introduction

Two trends can be discerned in EU competition law over the last two decades. The first relates to the refocusing of its respective aims, calling for a more economics-based approach and pointing to ‘consumer welfare’ as the preferred standard in EU competition law analysis. This can be termed the substantive modernization of EU competition law enforcement.1 The second trend can be termed procedural modernization and relates to alleviating the Commission of some of its enforcement burden as well as involving more actors in EU competition law enforcement (NCAs, national courts, and private parties).2 Efforts to improve private EU competition law enforcement should be viewed as a further step in this direction.3

Since, as argued in Chapter 2, the substantive modernization has not yet fully succeeded, consumer participation in private competition law enforcement could be viewed as an alternative vehicle in bringing consumer interest into EU competition law analysis.4 In Chapter 3 this option is addressed and normative (p. 48) justifications for such participation are provided.5 First and foremost, consumer damages claims could further the aims of private enforcement. In section 2, the principal aims of private competition law enforcement are identified by assessing EU jurisprudence and the Commission’s policy documents. Despite the Commission’s emphasis on the compensatory component of damages actions, EU jurisprudence suggests that increased attention should be given to their deterrent role. Together, compensation and deterrence are classified as the endemic/functional aims of damages actions (since they are endemic and pertain to the very function of competition law enforcement). If the choice and balance between the endemic/functional aims of damages actions is correct, this will further advance a range of ancillary benefits pertaining to the wider EU institutional framework. Section 3 discusses these benefits, which include primarily the enhancement of consumers’ education and empowerment that will further contribute to the legitimization of EU competition policy (wider institutional benefits).

2.  Endemic/Functional Aims of Private Competition Law Enforcement

2.1  Private enforcement of EU law

This section gives an overview of the debate on private enforcement of EU law before turning to examine private EU competition law enforcement in particular. The former analysis will put the competition law debate in context and will allow conclusions to be drawn regarding whether private EU competition law enforcement merits special attention. Courage6 and Manfredi7 specifically address the right to damages for competition law violations and form part of the Court’s case law on the involvement of individuals in the enforcement of EU law before national courts.8

(p. 49) In Van Gend en Loos, the ECJ acknowledged that EU law confers rights on individuals that arise not only when they are expressly granted but also as a derivative of clearly defined obligations imposed by the Treaty on individuals, Member States, and EU institutions.9 It went on to state that:

the vigilance of individuals concerned to protect their rights amounts to an effective supervision in addition to the supervision entrusted by [Articles 258 and 259] to the diligence of the Commission and of the Member States … It follows … that [Article 30] must be interpreted as producing direct effects and creating individual rights which national courts must safeguard.10

The ECJ viewed private enforcement of EU law as complementary to the public enforcement avenues provided in the Treaty and suggested that individuals can become enforcement actors to the benefit of EU law.11 According to the ECJ, certain EU norms have ‘direct effect’ and can be invoked before national courts provided that they confer rights upon individuals and are sufficiently clear, precise, and unconditional.12 Thus, not only is EU law beneficial for individuals in the sense that it creates directly effective rights, it is also through the enforcement of those rights before the national courts that compliance with EU norms can be safeguarded.13 Whether these rights have a substantive content or are merely restricted to an invocation entitlement depends on the nature of the Treaty provision at issue.14

However, the rights that individuals derive from directly effective EU norms have to be enforced before national courts according to national remedies and procedures,15 since the Treaty was not intended to create new remedies.16 This echoes the principle of national procedural autonomy17 and the national courts’ (p. 50) obligation to enforce EU rights in line with the principle of equivalence and effectiveness.18 At the same time, Member States have an obligation to provide remedies that are sufficient to safeguard effective judicial protection in the areas covered by EU law.19

The Court’s case law has cast doubts on the existence of the principle of national procedural autonomy.20 In Factortame I, the Court stressed the importance of the principle of effectiveness and required the national court to grant interim relief and set aside the national rule in question as it prevented EU rules ‘from having full force’.21 In Francovich, it expressly acknowledged that State liability for damages caused to individuals from a breach of EU law is inherent in the system of the Treaty.22 It came to this conclusion by building on the Van Gend en Loos principle of directly effective Treaty rights and the national courts’ obligation to safeguard them in accordance with the principle of sincere cooperation enshrined in Article 4(3) TEU.23 The Court, with this formulation, caters for the ‘full effectiveness of Community rules’ and the ‘protection of the rights which they grant’.24 As AG Mischo observed, the formulation of State liability for damages as a matter of EU law also has the potential to act as an incentive for Member States to comply with their obligation,25 thereby safeguarding the ‘full effectiveness of Community (p. 51) rules’. Thus, State liability under EU law is formulated so as to enlist the ‘vigilance of individuals’ for the enforcement of their rights and through this for the enforcement of EU law.26

The ‘compliance role’ ascribed to private litigation is particularly important in the field of competition law given that:

according to Article 3(1)(g) EC … [Article 101] constitutes a fundamental provision which is essential for the accomplishment of the tasks entrusted to the Community and, in particular, for the functioning of the internal market.27

Competition law provisions are attributed a public policy character.28 They impose obligations on private parties, yet their aim is to safeguard the competitive process as a means of conferring benefits on consumers.29 A competition law violation is established whenever certain conduct adversely impacts on the competition law aim, which serves the general interest. However, at the same time and depending on the nature of the competition law violation in each specific case, certain private interests are affected as well. This adds to the dual nature of competition provisions as laws for the protection of both private and public interests.30 Through the protection of the rights of private parties before national (p. 52) courts, the public element of competition law is reinforced. Thus, a court implementing those provisions will interpret them in the light of the public interest they seek to protect.31

2.2  Private enforcement of EU competition law: EU institutions’ approach

Before the reinvigoration of the debate on private competition law enforcement, the Union institutions were cognizant of the potential application of EU competition law by national courts. In 1966, the Commission published a study on the situation regarding private enforcement of competition rules in the then six Member States. According to this study, private parties can have adequate recourse to national courts when damaged by a competition law violation.32 In the Thirteenth Report on Competition Policy the Commission, for the first time, dedicated a separate section to the application of EU competition law by national courts, thereby acknowledging a widespread misconception regarding the Commission being the sole enforcer of competition law in the EU despite the national courts’ potential to enforce competition norms as well.33 It also stated that:

The machinery for enforcing competition law is thereby to some extent decentralised, the availability of relief more evenly distributed geographically and the place where justice can be obtained brought closer to the individuals seeking it … Scant use has yet been made of the possibility of actions for damages for breaches of the Community competition rules. There is a need to make all concerned more aware of this possibility. The Commission believes it desirable that the judicial enforcement of Articles 85 and 86 should also include the award of damages to injured parties because this would render Community law more effective.34

The above passage suggests that damages actions possess the potential to redress victims’ harm, while at the same time bringing closer to the wider public the benefits of competition law enforcement and contributing to the effective enforcement of competition law. By quoting BRT v SABAM,35 the Commission stresses the obligation of national courts to directly protect effective Treaty rights conferred (p. 53) on individuals.36 At the same time, however, by referring to the ‘decentralised [enforcement] machinery’ it seems to suggest that damages actions possess additional merits other than delivering justice to affected individuals.37 This was expressly stated two years later when the Commission accepted that:

the application by national courts would be in the interests of the proper functioning of the system of competition rules, which ultimately benefits all economic operators in Europe.38

The Commission views private enforcement not only as a system for protecting individual rights but also as a wider instrument to secure the observance of EU competition norms. Despite emphasizing the former by pointing to the distinct functions of private and public enforcement, it nevertheless accepts its deterrent role as well.39 After all, enlisting national courts as full-force enforcement authorities was one of the driving forces behind Regulation 1/2003.40

The ECJ, in Courage,41 reiterated in a clearer manner the twin aims of private competition law enforcement, in line with the general approach to private enforcement of EU law and the Commission’s pronouncements in relation to EU competition law in particular. In this case, Crehan (a publican) had signed two 20-year lease agreements with Intrepreneur Estates Ltd, which was co-owned by Courage (a brewery). The lease agreement contained an exclusive purchasing obligation for Crehan to obtain most of his beer supplies from Courage. Courage brought an action against Crehan before the English courts for the recovery of unpaid deliveries of beer. Crehan argued that the beer tie was contrary to (p. 54) Article 101 TFEU and launched a counterclaim for damages suffered as a result.42 The English Court of Appeal applied for a preliminary ruling and asked the Court whether the English in pari delicto rule, ie that a party to an illegal agreement cannot claim damages from the other party, thereby benefiting from its own misconduct, was contrary to the uniform application of EU law. In other words, could a party to an illegal agreement rely on Article 101 TFEU in order to claim damages as a result of his adherence to the prohibited clause, and should the English in pari delicto rule be disallowed as contrary to EU law? If yes, what circumstances should the national court take into consideration?43

The referring court pointed to the tension between the uniform application of Union law44 and the principle of national procedural autonomy.45 The issue was solved in favour of the uniform application of Union law, providing yet another example of the relativity of national procedural autonomy. The Court did not pronounce the existence of individual liability for infringement of competition law in an unequivocal way as it had in Francovich with regard to State liability, in which it stated that ‘it is a principle of Community law that the Member States are obliged to make good loss and damage caused to individuals by breaches of Community law for which they can be held responsible’.46 Nevertheless, if the Court’s reasoning is cautiously followed, it could be suggested that it had actually arrived at the same conclusion. In Courage, the ECJ ruled, though not explicitly, on the existence of an EU right to damages for breaches of competition rules,47 and alluded to its underlying aims.

(p. 55) The Court began its reasoning by emphasizing the principles of supremacy and the direct effect of the EU legal order and the respective duties thereby imposed on national courts, as these were pronounced in the seminal Costa v Enel48 and Van Gend en Loos cases, respectively.49 It then reiterated Eco Swiss on the importance attributed to competition law provisions and BRT v SABAM on the directly effective nature of competition law provisions and the individual rights they create, which the national courts must safeguard.50 After this three-step analysis based on the general principles of EU law and the nature of competition provisions, the Court concluded that:

any individual can rely on a breach of Article [101(1)] of the Treaty before a national court even where he is a party to a contract that is liable to restrict or distort competition within the meaning of that provision.51

Thus, the Court clarified the issue of who had standing, as a matter of principle, to invoke breach of competition provisions and suggested that as a matter of EU law standing is to be granted to any individual. Therefore, national laws denying standing to co-contractors (such as the English law at issue) will be contrary to EU law.52 Note that AG Mischo also alluded to the possibility of consumers being potential claimants, as he stated that ‘the individuals who can benefit from such protection are, of course, primarily third parties, that is to say consumers and competitors who are adversely affected by a prohibited agreement’.53

Defining the exact content and the beneficiaries of the individual rights under competition provisions is a complex task.54 A formulation regarding the content of the right can be related to the obligation imposed by the same provisions.55 In the case of an undertaking breaching its obligation not to engage in anti-competitive conduct, this will create rights for individuals following the Van Gend en Loos formulation. In this case, the right will be to undo the consequences of the anti-competitive breach. This was supported by AG Mischo in (p. 56) Courage, in which he observed that directly effective rights under Article 101 TFEU include ‘the right, for individuals, to be protected from the harmful effects which an agreement which is automatically void may create’.56

Thus, if a competition law violation occurs, the primary obligation is breached giving rise to the derivative right, which can be protected through specific remedies before the national courts.57 In Courage, the ECJ referred to ‘the existence of such a right [in damages]’. Thus, the ECJ clarified the content of Union rights conferred on individuals by the directly effective competition provisions. The importance of Courage lies in the fact that the Court ruled that a private party can exercise this right to damages through an appropriate remedy that is not impeded by a national rule. Essentially, the Court ruled that the English in pari delicto rule (in its absolute form) should be set aside. This has the effect of giving co-contractors a remedy that is not available to them under English law.58 The Court based its conclusion on the effective protection of individual rights and the effective enforcement of competition norms,59 while here it is suggested that the deciding factor was the latter.60

In the formulation of the right to damages the principle of effectiveness has played a pivotal role. In Courage, the Court referred to the ‘full effectiveness’ of EU competition law rules and the ‘protection of rights they confer on individuals’.61 It further added that:

in particular, the practical effect of the prohibition laid down in [Article 101(1)] would be put at risk if it were not open to any individual to claim damages … Indeed, the existence of such a right strengthens the working of the Community competition rules and discourages agreements or practices, which are frequently covert, which are liable to restrict or distort competition. From that point of view, actions for damages before the national courts can make a significant contribution to the maintenance of effective competition in the Community.62

The practical effect of the competition law prohibitions is more important, especially given the fact that, in this very judgment, the Court pointed to the significance of those provisions for the accomplishment of the EU’s objectives, the functioning of the internal market being underlined.63 In the above quote, the (p. 57) Court endorses the deterrent effect of damages actions and their potential to act in the public interest.64

The ECJ approach in Courage was re-affirmed in Manfredi. In this case, consumers filed damages actions against insurance companies for damages flowing from an agreement that raised the price of insurance premiums following the agreement having been declared unlawful by the Italian NCA. The referring court asked the ECJ whether Article 101 TFEU (if applicable in this case) should be interpreted as allowing third parties with a relevant legal interest to claim damages when there is a causal connection between the prohibited practice and the harm. Furthermore, it addressed preliminary questions on limitation periods and punitive damages.65

As a new point the ECJ pronounced on the causality requirement and it stated that:

any individual can rely on the invalidity of an agreement or practice prohibited under that article and, where there is a causal relationship between the latter and the harm suffered, claim compensation for that harm.66

In adding causality as a condition of the right to damages, the ECJ again relied on the principle of effectiveness.67 However, the Court did not refer to the potential of damages actions to contribute to the maintenance of effective competition in Europe, as it did in Courage.68 Thus, one could conclude that the emphasis in Manfredi was on the effective protection of the right to damages rather than the effective enforcement of competition law. Nonetheless, this would have been a preliminary conclusion in that the ECJ stressed this element of damages actions in relation to the preliminary question on punitive damages, and actually linked it to the first reference to the principle of effectiveness in relation to the preliminary question on causation as a condition of the right to damages.69

Manfredi also discussed the possibility of granting punitive damages. The Court stated that damages actions can ‘[contribute] to the maintenance of effective competition in the Community’. Nonetheless, there is no obligation as a matter of EU law to award punitive damages.70 Overall, Manfredi followed Courage on the point of the aims of damages actions and it was important for the additional reason that it concerned consumer damages actions, thereby pointing to their relevant deterrent function.

(p. 58) Since Courage and Manfredi, the Court has had ample opportunities to highlight the deterrent potential of damages actions and their respective potential to contribute to the effective enforcement of EU law. Europese Gemeenschap v Otis NV and Others concerned a follow-on claim brought by the Commission before the Belgian courts against elevator manufacturers that were fined by the Commission for their participation in the elevators cartel.71 The defendants argued that if the Commission were allowed to bring a damages action against them, this would amount to a breach of the principle of judicial independence and equality of arms in the light of the Commission’s role in the proceedings.72 The ECJ rejected this argument by relying on Courage and Manfredi and reiterated that the EU principle of effectiveness would be jeopardized if it were not open to any individual to bring a damages action before national courts and stressed the potential of the right to damages to contribute to the maintenance of undistorted competition in the EU.73 Article 47 of the Charter of Fundamental Rights of the EU does not preclude the Commission from bringing a damages action before national courts for losses sustained by EU institutions as a result of an agreement found by the Commission to be contrary to EU competition rules.74

In Pfleiderer, the Court was called to assess whether, in order to prepare their actions for damages, private parties should be granted access to the leniency file.75 This issue is addressed in detail in Chapter 4 but here it is sufficient to say that in order to answer the preliminary reference question the Court reiterated the contribution of damages actions to the maintenance of effective competition in the EU.76 In the subsequent Donau Chemie AG, the ECJ was asked whether a national provision, according to which third parties could only be granted access to documents for the purpose of filing a damages claim with the consent of all the parties in the proceedings and national courts could not weigh up the conflicting interests in order to grant access on a case-by-case basis, was contrary to (p. 59) EU law.77 The ECJ stressed the deterrent effect of the EU right to damages.78 The procedural requirements for its exercise are determined by national law in accordance with the principle of equivalence and effectiveness.79 However, in the light of Pfleiderer, national courts should be able to weigh up conflicting interests, namely the exercise of the right to compensation and the rights of the implicated undertakings as well as any adverse impact on incentives to cooperate with the competition authorities.80 The ECJ assessed the possible impact of granting access to the leniency file in the course of private enforcement and the effectiveness of leniency programmes and made a bold statement in favour of the deterrent effect of damages actions:

as regards the public interest of having effective leniency programmes … it should be observed that, given the importance of actions for damages brought before national courts in ensuring the maintenance of effective competition in the European Union … the argument that there is a risk that access to evidence contained in a file in competition proceedings which is necessary as a basis for those actions may undermine the effectiveness of a leniency programme in which those documents were disclosed to the competent competition authority cannot justify a refusal to grant access to that evidence.81

In CDC, the GC made another clear statement in favour of the deterrent effect of damages actions when it stated that:

the leniency and co-operation programmes whose effectiveness the Commission is seeking to protect are not the only means of ensuring compliance with EU competition law. Actions for damages before the national courts can make a significant contribution to the maintenance of effective competition in the EU.82

In Kone, the ECJ was called to answer the question regarding whether a person can claim damages from cartel members for the loss caused by a non-party to the cartel that raised the prices of his or her products more than he or she would have done in the absence of the cartel (umbrella pricing).83 The ECJ relied heavily on the principle of effectiveness and answered the question in the affirmative.84 In particular, the ECJ stated that:

[i]‌t is true … that it is, in principle, for the domestic legal system of each Member State to lay down the detailed rules governing the application of the concept of the ‘causal link’. However, it is clear from the case-law of the Court … that national legislation must ensure that European Union competition law is fully effective. Those rules must therefore specifically take into account the objective pursued by Article 101 TFEU, which aims to guarantee (p. 60) effective and undistorted competition in the internal market, and, accordingly, prices set on the basis of free competition. In those circumstances, the Court has held … that national legislation must recognise the right of any individual to claim compensation for loss sustained.85

Thus, the ECJ appears to suggest that the right to damages is instrumental for guaranteeing free and undistorted competition in the internal market, ie contributing to the deterrence of competition law violations. To this end, even if Member States are free to set the rules governing the exercise of the right to damages before national courts,86 such rules should not prevent the full effectiveness of competition rules. In Kone, the ECJ placed the emphasis on the effective enforcement of competition law rather than the effective judicial protection of litigants, thereby suggesting that damages actions primarily contribute to the former.87

Apart from the Court’s jurisprudence highlighting the contribution of damages actions to the effective enforcement of EU competition law, the Commission has also highlighted this function on a number of occasions. In its Green Paper on Damages Actions, which spurred the policy debate on introducing EU measures in order to advance private competition law enforcement, the Commission, echoing a number of Commissioners’ speeches at the time,88 commented on the binary compensatory and deterrent function of damages actions.89 In so doing, the Commission simply reiterated Courage and recognized compensation and deterrence as equally important goals of private enforcement.90

However, the Commission’s rhetoric shifted in its subsequent White Paper on Damages Actions, in which it identified compensation as the first and foremost guiding principle for the proposed measures to improve the conditions for bringing (p. 61) damages actions before the national courts.91 This shift can be attributed to the need for the proposed measures to be premised on a genuine European approach reflecting Member States’ legal culture and tradition,92 since in the majority of Member States damages actions aim primarily at compensating the victim rather than deterring perpetrators.93 The withdrawn Draft Damages Directive also reflected this approach.94 On closer reading though, both the WP and the Draft Damages Directive seem to have adopted a functional approach towards private damages claims by enlisting private actors for the effective enforcement of competition law.95 The Proposal for a Directive on Damages Actions has further shifted the focus from effective competition law enforcement, as one of the main aims of damages actions, to ensuring the effectiveness of the right to damages and optimizing the interaction between public and private competition law enforcement.96 This has assuaged political opposition to the adoption of the Directive. However, it constitutes a retreat from the Court’s bold approach to the effectiveness and deterrent effect of damages actions. However, the Directive does underline the public policy character of competition law provisions and the potential of damages actions to contribute to the effective enforcement of competition law in the EU.97

(p. 62) The above analysis indicates that there is an inconsistency between the Court’s approach to private competition law enforcement and the aims identified by the Commission. The Court appears to emphasize the deterrent function of damages actions, whereas the Commission conceals the latter in an attempt to win Member States’ support for its private enforcement initiative. Nonetheless, the Court jurisprudence indicates that damages actions can equally contribute to the effective enforcement of competition law and the deterrence of competition law violations while providing compensation for affected parties,98 whereas emphasis is placed on the former function.

2.3  Scepticism as to the deterrent function of (follow-on) damages actions

Private damages actions carry different deterrence potential depending on whether they are brought as stand-alone or follow-on claims, ie claims that depend on a prior infringement decision by the Commission or an NCA.99 From a pragmatic perspective, if private litigation levels were to increase in Europe, this would most probably concern follow-on rather than stand-alone actions,100 which are seen as less beneficial in terms of deterrence since they freeride on public enforcement.101

Nevertheless, follow-on actions could still contribute to deterring competition law infringements. First, the distinction between stand-alone and follow-on actions is not as clear-cut as it first appears. One could distinguish between (p. 63) follow-on actions in a technical sense, ie where a prior decision exists addressed to the defendants, and in a wider sense, ie where there are ongoing proceedings but no final decision or where the defendants are members of the same undertaking but not addressees of the infringement decision.102 In Nokia v AU Optronics and others, Nokia brought a claim for damages against LCD manufacturers before the English High Court. At the same time there was an ongoing Commission investigation into LCD manufacturers, which resulted in the imposition of fines for larger LCDs. No fines were imposed on the smaller LCD manufacturers that were sued by Nokia before the High Court. Thus, Nokia’s claim could be termed a ‘hybrid’ claim, since even though it could not benefit from a Commission’s infringement decision Nokia developed its claim through disclosure in relevant US proceedings.103 In this case, the Commission’s investigation prompted Nokia to bring its hybrid claim and, in the absence of a Commission decision, Nokia developed its stand-alone claim. Sales J accepted a rather low threshold for pleading requirements and pointed to the tension between ensuring that claims are clearly pleaded to allow the defendant to answer and preserving justice by not preventing the claimant from bringing a meritorious case due to overly strict and demanding pleading rules.104 The balance was struck ‘by allowing a measure of generosity in favour of a claimant’,105 thereby indicating a preference for private enforcement that could potentially act as a disincentive to firms that are contemplating engaging in anti-competitive activities.

Another example of a hybrid claim comprising both a stand-alone and a follow-on element comes from Toshiba Carrier v KME.106 In this case, the English Court of Appeal suggested that English subsidiaries of a cartel could not be sued as anchor defendants if they were not the addressees of the statement of objection and the parent company did not exercise decisive influence. Nonetheless, the court allowed the claim because it contained a stand-alone element.107 Again, even though the infringement decision was not formally binding upon the national court, it triggered private litigation.

Second, there is a risk that reduced public enforcement can have a negative spill-over effect on follow-on claims. Regulating the interaction between public and private enforcement is the primary objective of the adopted Directive on Damages Actions108 (p. 64) and the interplay between damages actions and leniency programmes has been addressed therein.109

The possibility of facing follow-on damages actions can in itself deter undertakings from committing a competition law violation. Furthermore, the infringing undertaking might end up paying more in damages than in administrative fines.110 For example, the Commission imposed fines totalling €388.128 million against seven undertakings for their participation in the hydrogen peroxide cartel.111 CDC, a company purchasing claims on behalf of cartel victims brought damages claims against cartel participants in Germany and Finland and sought a total of €553 million plus interest.112 So, if an undertaking (acting rationally)113 engages in anti-competitive conduct only when the profits therefrom exceed the potential costs (comprising fines and damages) divided by the probability of detection, one can reasonably assume that if the potential costs increase,114 then there is a greater deterrent effect on any potential anti-competitive conduct. Provided that the necessary procedural mechanisms are in place, the potential costs of a competition law violation (and thus deterrence) can rise significantly, given that ‘victims of competition violations are foregoing not just millions but billions in compensation’.115

Finally, the assertion that follow-on actions do not contribute to the detection of competition law violations does not hold true in every case.116 Follow-on actions (p. 65) can be attributed an indirect detection function in the following way: there is the possibility that private parties, in this case consumers or consumer organizations, are incentivized to alert the public authorities to a potential antitrust violation so that a decision in the course of public enforcement is adopted, thereby facilitating the subsequent damages actions.117

Another criticism often levied against private enforcement of competition law is based on its nature. Critics argue that because competition law is public law, private litigants are not in a position to achieve the policy goal of deterring competition law violations in order to protect competition in the market as a means of enhancing consumer welfare. Thus, it is probable that they deter legal actions as well (over-deterrence problem—Type I errors).118 The fact that private parties usually act in their own self-interest entails the risk that they might engage in nuisance litigation.119 Even if, in theory, there is a possibility of over-enforcement, the approach to private enforcement in EU law suggests that private individuals can act as agents for the public interest.120 For example, when a consumer files a claim against an infringing undertaking, they do not seek to preserve the competitive process as a means of enhancing consumer welfare in abstracto but, rather, they are defending their own interests before a national court.121 However, by so doing they may act in the public interest as well.122

(p. 66) 2.4  Ranking the endemic aims

Deterrence and compensation are termed endemic factors, since they pertain to the functions of competition law enforcement and are distilled from the Court’s case law. The latter attributes equal weight to these goals, although in the light of the structure of the EU edifice and the direct effect of competition law provisions, a preference is granted to the deterrent function. This is further supported by the theory of optimal enforcement,123 and the deterrence theory,124 following which the optimal sanction shall exceed the gains resulting from the competition law violation divided by the probability of detection. Private litigation raises the financial stakes for undertakings that are contemplating engaging in anti-competitive conduct and could, thus, act as a disincentive for engaging in the said activity.

However, even if deterrence is granted priority over compensation, the latter should not be disregarded. The Court’s jurisprudence, as well as the Commission’s efforts, point to a delicate balancing exercise, reconciling the two aims if possible, rather than excluding one altogether. The right of private parties is derived from the Treaty and it cannot be excluded, as in the case of indirect purchasers in the US, for example, based on deterrence grounds only.125 Proponents of the Chicago School approach have advanced arguments against the compensatory aim of private enforcement arguing that, from an economic perspective, it is excessively costly to identify the victims of antitrust violations and quantify their losses. The high costs involved in awarding compensation do not correspond to the value attributed to it by society—given the relatively low value of individual claims, especially when private actions are brought by consumers.126 This approach cannot be accepted in a legal system that takes justice and fairness considerations into account, apart from economic arguments of efficiency and cost minimization. In the EU, the right to damages, as a right granted by EU law, should be effectively safeguarded.127 This is also consistent with the right to a fair trial, which is guaranteed in the constitutions of individual Member States and by Article 6 ECHR as (p. 67) well as Article 47 of the Charter of Fundamental Rights of the European Union. This right incorporates the right to effective access to the courts.128

At the same time, compensation should not be viewed as an absolute goal; it should also be pursued in accordance with the proportionality principle.129 In essence, this means that, in cases where the individual consumer does not view compensation as particularly important, the enforcement system should prioritize other aims without abandoning the compensatory aim completely. The compensatory function would yield to the deterrent function, and alternative forms for the provision of compensation could be devised. For example, cy-près mechanisms could be put in place.130 This would allow the adoption of functional procedural mechanisms that would contribute to the deterrence of competition law infringements whilst also benefiting consumers and promoting wider policy goals.

3.  Ancillary Institutional Benefits

3.1  Proliferation of information—contributing to consumer education and empowerment

In the consumer law field, increased attention is given to improving consumer education and empowerment, which in turn will raise consumer confidence in cross-border shopping.131 The role of consumers exerts a vital influence in any given market.132 ‘[J]‌ust as competition is good for consumers, enhancing the power of consumer choice is good for competition.’133 Indeed, the power of consumer choice can be improved through regulatory instruments under consumer protection law.134 This section builds on the interplay between competition and consumer law and argues that more active consumer involvement in private (p. 68) competition law enforcement can in turn raise consumer awareness and improve the conscious exercise of consumer choice. It can, thus, be seen as an alternative form of information proliferation and consumer education, which in turn will increase literacy and consumer choice as a spur to competitiveness.135

Information asymmetries constitute a frequently identified market failure on the demand side.136 Consumers fail to exercise their right to choose according to their needs due to a lack of necessary information. Thus, the provision of information is a common regulatory approach in the field of consumer law.137 A further related question is how much information is actually enough, since recent studies suggest that the consumer cannot always process the information in an effective way, thus creating further market problems.138 Getting consumers more actively involved in private competition law enforcement will result in an increased information flow without the need to adopt specific measures for information disclosure.

Imagine the following situation: a consumer organization A brings an action for damages against two retailers, B and C (both large toy outlets) following a competition authority’s decision. A claims that because of the price-fixing agreement between B and C regarding the price of a popular item, consumers were damaged by x amount. The court rules in favour of A. This judgment (with the publicity that it could be expected to receive) could signal to consumers that they should engage in price comparisons. At the same time, it would allude to the possibility of getting involved in competition law enforcement. In turn, the availability of this participatory right could prompt consumers to process the available information responsibly and be more careful when exercising their right to choose.139

3.2  Legitimization of EU policies

Competition policy lacks the necessary social support due to the fact that consumers’ voices are rarely heard in competition policy.140 Further procedural measures allowing for active consumer involvement in private competition law enforcement possess the potential to bring EU citizens in their capacity as consumers closer to EU competition policy, and act as an alternative form of control in the (p. 69) Commission and NCAs’ decision-making. Increased consumer involvement could potentially bridge the gap between EU competition policy and its addressees and it should be seen in the light of two initiatives in the EU: the first concerns efforts to improve European governance and the second concerns efforts to promote private enforcement of EU law.

The first initiative concerning European governance ‘proposes opening up the policymaking process to get more people and organisations involved in shaping and delivering EU policy’.141 One of the proposals for change concerns the involvement of civil society.142 This is a form of ex ante participation. For example, consumers, either on their own or through their respective organizations as actors of civil society, can provide comments in an open debate prior to the adoption of any concrete legislative measure or policy decision.143

Ex ante participation is important for our purposes since it allows an interesting analogy to be made. In the field of ex ante participation, new modes of governance have emerged (ranging from framework directives, the Open Method of Coordination, and other soft law instruments),144 which complement the traditional ‘command and control’ type of regulation adopted in the past.145 The participation of interested stakeholders in the legislative process constitutes one of the key characteristics of these emerging forms of governance in the EU.146 The element of involvement as a desideratum is the same in both ex ante and ex post enforcement procedures and can contribute towards increased openness and accountability.

The second effort concerns a decided shift from the administrative-led enforcement of EU law to a model where affected actors should assume a more active role. Note, for example, the initiatives in the consumer field,147 the Environmental (p. 70) Liability Directive,148 and, most importantly for the subject matter of this book, the private enforcement initiative in the field of competition law.149 The increased employment of litigious ex post enforcement methods reveals the advent of the ‘adversarial legalism’ movement in Europe.150

Adversarial legalism is identified as the dominant regulatory style in the US. One of its main characteristics is the increased role of adversarial procedures in solving disputes.151 Member States’ legal cultures cannot support the rise of litigation, as is the case in the US.152 But this does not detract from the fact that this tendency is indeed present and can assume an ancillary role, as the efforts to enhance access to justice, grant a more active role to national judiciaries, and expand EU rights reveal.153 This is particularly true in the field of competition law since Courage and Manfredi and the changes to the enforcement system brought by Regulation 1/2003.

Promoting consumer damages claims in EU competition law can be located in the juncture between the two tendencies identified above. It brings the beneficial element of the participation of interested stakeholders into a changing landscape of enforcement and can increase the legitimacy of competition policy.154 Scharpf distinguishes between input and output legitimacy, the former reflecting authentic preferences of citizens and the latter catering for effective outcomes.155 Consumer participation in private competition law enforcement, inasmuch as it enhances effective enforcement of EU competition law, can account for better (p. 71) output legitimacy. At the same time, it improves input legitimacy since it provides an avenue for affected consumers to get involved in the enforcement of EU competition law.

Competition officials have welcomed the initiative on private competition law enforcement, stressing that ‘[i]‌n difficult times for the Union, such a development in terms of democratisation and the connection between its law and its citizens is only to be welcome’.156 European consumers, as market actors, enjoy market rights, whereas European citizens enjoy not only market rights but also political and social rights.157 Consumer involvement in private competition law enforcement aims at protecting the market rights of consumers and, more specifically, rights derived from competition law. At the same time, though, it reinforces the element of citizen participation.158

Allowing consumers to get involved in the enforcement of competition law could potentially raise their trust in market forces.159 This is even more important if one considers the consumer protection model adopted in the EU. The emphasis is on market-oriented outcomes (trust in competition) accompanied by a modest adoption of consumer regulation.160 So, insofar as the individual is ascribed a more responsible role,161 the necessary tools should be put in place for this role to be effectively exercised.

This has become even more important since the adoption of the LT and the symbolic shifting of the objective of undistorted competition from the first Treaty provisions to a protocol. Even if this does not change the application of EU competition law, it reveals a certain scepticism towards EU competition policy. So, now it may be more imperative for European citizens to realize the advantages that derive from competition law enforcement. Arguably, the best way forward is for the actual beneficiaries to be more involved in the enforcement process by devising the appropriate mechanisms to enable them to do so. This is also in line (p. 72) with the changes introduced by the LT in order to enhance citizens’ participation and the EU’s democratic legitimacy.162

4.  Conclusion

This chapter discussed the two main functions of consumer claims in the field of competition law (as a sub-category of damages claims) according to the Court’s jurisprudence and the Commission’s policy initiative on private competition law enforcement that comprise deterrence and compensation. In identifying the primary function the Court favours the effective enforcement of EU competition law norms over the effective protection of individual rights. To the contrary, the Commission places considerable emphasis on the compensatory rationale of damages actions, departing from the CJEU’s approach. The primary aim attributed by the Commission to damages actions is important, since it impacts on the form of the proposed measures. Procedural and remedial measures should be structured in accordance with the aim of the EU right to damages, as pronounced by the CJEU. As AG Tesauro noted, ‘Member States’ autonomy with regard to judicial remedies for the infringement of rights conferred by Community provisions is firmly tied to the result sought by Community law’.163 The same goes for the Commission’s discretion with regard to proposed measures for the enforcement of EU rights emanating directly from effective Treaty provisions. This is not to suggest that the proposals in the Directive on Damages Actions are inconsistent with the primary aim of the right to damages but, rather, to underline that the Commission should have taken a bolder stance in the light of the deterrence aim, as will be discussed in more detail in subsequent chapters. This could have made consumer claims instrumental in maintaining effective competition in the EU.

Apart from the instrumental role of consumer damages claims, if structured correctly, they can account for two very important ancillary benefits. First, they can act as an information mechanism raising consumer awareness and empowerment and second they can add a modicum of legitimacy to EU competition policy.

Footnotes:

1  See Chapter 2, text to nn 84–99.

2  Council Regulation (EC) No 1/2003 on the Implementation of the Rules on Competition Laid Down in Articles 81 and 82 of the Treaty [2003] OJ L1/1. The Commission views Regulation 1/2003 as the ‘keystone of the modernisation of the European Union’s antitrust enforcement rules and procedures’. Commission (EC), ‘Report on the Functioning of Regulation 1/2003’ (Communication) COM(2009) 206 final, para 1.

3  Commission (EC), ‘Damages Actions for Breach of the EC Antitrust Rules’ (Green Paper) COM(2005) 672 final (GP); Commission (EC), ‘Damages Actions for Breach of the EC Antitrust Rules’ (White Paper) COM(2008) 165 final (WP); Commission (EU), ‘Proposal for a Directive of the European Parliament and of the Council on Certain Rules Governing Actions for Damages under National Law for Infringements of the Competition Law Provisions of the Member States and of the European Union’ COM(2013) 404, 11 June 2013; Directive 2014/104/EU of the European Parliament and of the Council of 26 November 2014 on Certain Rules Governing Actions for Damages under National Law for Infringements of the Competition Law Provisions of the Member States and of the European Union [2014] OJ L349/1.

4  Private enforcement is ascribed a narrow meaning encompassing only damages actions since, notwithstanding their contemporaneous character and the minimal consumer involvement therein, they have an additional compensatory function. In general, private enforcement can be defined as the invocation of competition law provisions in private litigation by private parties. See GP (n 3), para 1.1. It encompasses a variety of different tools, ranging from injunctive relief and the defensive use of competition law (Article 101(2) TFEU) to damages actions. In this book ‘private enforcement’ and ‘damages actions’ are used interchangeably. See P Nebbia, ‘Damages Actions for the Infringement of EC Competition Law: Compensation or Deterrence?’ (2008) 33 ELRev 23 which points to a subtle difference in meaning.

5  For a concise discussion see M Ioannidou, ‘Enhancing Consumers’ Role in EU Private Competition Law Enforcement: A Normative and Practical Approach’ (2012) 8 Comp L Rev <http://www.clasf.org/CompLRev/Issues/CompLRevVol8Issue1.pdf> accessed 10 June 2014, 59, 65–69.

6  Case C-453/99 Courage Ltd v Bernard Crehan and Bernard Crehan v Courage Ltd and Others [2001] ECR I-6297.

7  Joined Cases C-295/04 to 298/04 Vincenzo Manfredi and Others v Lloyd Adriatico Assicurazioni SpA and Others [2006] ECR I-6619.

8  Commission (EC), ‘Annex to the Green Paper, Damages Actions for Breach of the EC Antitrust Rules’, (Staff Working Paper) SEC(2005) 1732, 19 December 2005 (GP SWP), paras 19–20. See also J Temple Lang, ‘The Principle of Effective Protection of Community Law Rights’ in D O’Keeffe and R Bavasso (eds), Judicial Review in European Union Law—Liber Amicorum in Honour of Lord Slynn of Hadley (Kluwer Law International 2000) 235, 250, 273; H Smith, ‘The Francovich Case: State Liability and the Individual’s Right in Damages’ (1992) 13 ECLR 129, 132; M Hoskins, ‘Garden Cottage Revisited: The Availability of Damages in the National Courts for Breach of the EEC Competition Rules’ (1992) 13 ECLR 257, 259; Case C-128/92 H J Banks & Co v British Coal Corporation [1994] ECR I-1209, Opinion of AG van Gerven.

9  Case 26/62 NV Algemene Transport—en Expeditie Onderneming van Gend en Loos and Nederlandse Administratie der Belastingen [1963] ECR 1, 12; See K Lenaerts, ‘Constitutionalism and the Many Faces of Federalism’ (1990) 38 AJCL 205, 209–210 for the importance of this judgment for the EU legal order.

10  Ibid, 13 (emphasis added).

11  P Craig, ‘Once Upon a Time in the West: Direct Effect and the Federalization of EEC Law’ (1992) OJLS 453, 455.

12  Van Gend en Loos (n 9) 13. P Pescatore, ‘The Doctrine of “Direct Effect”: An Infant Disease of Community Law’ (1983) 8 ELRev 155, 176–177. The direct effect of competition provisions has already been acknowledged in BRT v SABAM: Case 127/73 Belgische Radio en Televisie and Société belge des auteurs, compositeurs et éditeurs v SV SABAM and NV Fonior ‘BRT I’ [1974] ECR 51, paras 15–16.

13  T Eilmansberger, ‘The Relationship Between Rights and Remedies in EC Law: In Search of the Missing Link’ (2004) 41 CMLRev 1199, 1205.

14  Ibid, 1205–1206. Eilmansberger in this article attempts a classification of the relevant case law on the evolution of EU rights and remedies.

15  Case 33/76 Rewe v Landwirtschaftskammer fuer das Saarland [1976] ECR 1989, para 5.

16  Case 158/80 Rewe Handelsgesellschaft Nord mbH and Rewe-Markt Steffen v Hauptzollamt Kiel [1981] ECR-1805, para 44; Case C-432/05 Unibet [2007] ECR I-2271, para 40.

17  For a critical appraisal of this principle see C Kakouris, ‘Do the Member States Possess Judicial Procedural “Autonomy”?’(1997) 34 CMLRev 1389; see also M Ruffert, ‘Rights and Remedies in European Community Law: A Comparative View’ (1997) 34 CMLRev 307, 330. This term refers not only to procedural rules stricto sensu, but also to the wider set of rules for the enforcement of EU rights, either remedial or substantial. See A Komninos, ‘Civil Antitrust Remedies Between Community and National Law’ in C Barnard and O Odudu (eds) The Outer Limits of European Union Law (Hart 2009) 363, 372; P Haapaniemi, ‘Procedural Autonomy: A Misnomer?’ in L Ervo, M Graens, and A Jokela (eds), Europeanization of Procedural Law and the New Challenges to the Fair Trial (Europa Law Publishing 2009) 87, 94–95.

18  Rewe v Landwirtschaftskammer fuer das Saarland (n 15), para 5; Case 45/76 Comet v Produktschap voor Siergewassen [1976] ECR 2043, para 13; Case 106/77 Amministrazione delle Finanze dello Stato v Simmenthal [1978] ECR 629, para 22; Case 199/82 Administrazione delle Finanze dello Stato v SpA San Giorgio [1983] ECR 3595, para 12.

19  Article 19(1) TEU; On the significance of this provision see T Tridimas, The General Principles of EU Law (2nd edn, OUP 2006) 419–420; Also, Komninos (n 17) 375 comments that it is wrong to deduce from this provision that remedies are a matter of national law only.

20  T Tridimas, ‘Enforcing Community Rights in National Courts: Some Recent Developments’ in D O’Keeffe and A Bavasso (eds), Judicial Review in European Union Law—Liber Amicorum in Honour of Lord Slynn of Hadley (Kluwer Law International 2000) 465; S Weatherill, ‘Addressing Problems of Imbalanced Implementation in EC Law: Remedies in an Institutional Perspective’ in C Kilpatrick (ed) The Future of Remedies in Europe (Hart 2000) 87, 99. Haapaniemi (n 17) 111–118.

21  Case C-213/89 R v Secretary of State for Transport, ex p Factortame Ltd [1990] ECR I-2433, paras 20–21. On this case and the debate it generated regarding the relationship between EU law and the UK constitutional principle of parliamentary sovereignty see R v Secretary of State for Transport, ex p Factortame Ltd [1991] 1 AC 693 (HL); P Craig, ‘Sovereignty of the United Kingdom Parliament after Factortame’ (1991) 11 YEL 221; T Allan, ‘Parliamentary Sovereignty: Law, Politics and Revolution’ (1997) LQR 443; N Barber, ‘The Afterlife of Parliamentary Sovereignty’ (2011) 9 ICON 144.

22  Joined Cases C-6/90 and 9/90 Andrea Francovich and Others v Italian Republic [1991] ECR I-5357, para 35. See also Joined Cases C-46/93 and 48/93 Brasserie du Pêcheur SA v Federal Republic of Germany [1996] ECR I-1029, paras 20, 22, 31–33. For case law paving the way to Francovich see Case 6/60 Humblet [1960] ECR 559, para 36; Case 60/75 Carmine Antonio Russo v AIMA [1976] ECR 45, para 9; Simmenthal (n 18), paras 22–23; Factortame I (n 21), paras 20–23. On the Francovich case, see P Craig, ‘Francovich, Remedies and the Scope of Damages Liability’ (1993) 109 LQR 595.

23  Francovich (n 22), paras 31–37.

24  Ibid, paras 32–33.

25  Francovich (n 22), Opinion of AG Mischo, para 92.

26  For example, on the potential deterrent effect of private enforcement see Case 14/83 Von Colson and Kamann v Land Nordrhein—Westfalen [1984] ECR 1891, para 28; Case C-271/91 Marshall v Southampton and South-West Hampshire Area Health Authority [1993] ECR I-4367, para 24. On civil litigation’s potential to strengthen compliance with quality standards, see also Case C-253/00 Muñoz Cia SA and Superior Fruiticola Ltd and Redbridge Produce Marketing Ltd [2002] ECR I-7289, paras 30–31. For a comment on this case see A Biondi, ‘C-253/00 Muñoz Cia SA and Superior Fruiticola Ltd and Redbridge Produce Marketing Ltd [2002] ECR I-7289’ (2003) 40 CMLRev 1241, 1246.

27  Case C-126/97 Eco Swiss China Time Ltd v Benetton International NV [1999] ECR I-3055, para 36. For the potential changes to competition law and policy brought by the LT see R Lane, ‘EC Competition Law Post Lisbon: A Matter of Protocol’ in M Bulterman (ed), Views of European Law from the Mountain: Liber Amicorum Piet Jan Slot (Kluwer Law International 2009) 167; A Riley, ‘The EU Reform Treaty and the Competition Protocol: Undermining EC Competition Law’ (2007) 28 ECLR 703; R Barents, ‘Constitutional Horse Trading: Some Comments on the Protocol on the Internal Market and Competition’ in M Bulterman (ed), Views of European Law from the Mountain: Liber Amicorum Piet Jan Slot (Kluwer Law International 2009) 123; A Komninos, ‘Continuity and Change in EU Competition Policy’ (February 2010) CPI 1.

28  Eco Swiss (n 27), paras 36–39; Manfredi (n 7), para 31; Case C-8/08 T-Mobile Netherlands BV v Raad van Bestuur van de Nederlandse Mededingingsautoriteit [2009] ECR I-4529, para 49. On the public policy character of competition law norms see L Gyselen, ‘Comment from the Point of View of EU Competition Law’ in J Wouters and J Stuyck (eds), Principles of Proper Conduct for Supranational, State and Private Actors in the European Union: Towards a Ius Commune, Essays in Honour of Walter van Gerven (Intersentia 2001) 135, 141–145. See also the GW SWP in which the Commission stresses the importance of private enforcement, in order to sustain the competitiveness of the European economy and the existence of open markets in the EU internal market. Thus, by linking damages actions to the promotion of these important public interest goals, the Commission seems to suggest that private litigation can also serve the public interest. GP SWP (n 8), paras 9–11, 52. This was also acknowledged by the Commission in Joined Cases T-22/02 and 23/02 Sumitomo Chemicals v Commission [2005] ECR II-4065, para 128.

29  On the multiplicity of aims see Chapter 2, text to nn 20–61.

30  M Freedland, ‘The Evolving Approach to the Public/Private Distinction in English Law’ in M Freedland and JB Auby (eds), The Public Law/Private Law Divide (Hart 2006) 93, 107 that views competition law as being ‘indeterminate’ between public and private law.

31  Case C-360/09 Pfleiderer AG v Bundeskartellamt [2011] ECR I-5161, para 19.

32  Commission (EEC), ‘La Reparation des Consequences Dommageables d’ une Violation des Articles 85 et 86 du Traite Instituant la CEE’ (Brussels, 1966) Série Concurrence No 1, 5.

33  It was timely for the Commission to explore the possibility of national courts’ involvement some time after the enactment of Regulation 17/62, since this allowed time for the Union institutions to explore the implications of this Regulation and the Commission’s exclusive competence to enforce Article 101(3) TFEU. Council (EEC) Regulation No 17: First Regulation Implementing Articles 85 and 86 of the Treaty [1962] OJ Spec Ed 87, Article 9(1).

34  Commission (EC), Thirteenth Report on Competition Policy (Brussels, Luxembourg 1984) <http://bookshop.europa.eu/is-bin/INTERSHOP.enfinity/WFS/EU-Bookshop-Site/en_GB/-/EUR/ViewPublication-Start?PublicationKey=CB3883823> accessed 17 June 2014, paras 217–218 (emphasis added).

35  BRT I (n 12).

36  Ibid. See also Case 37/79 Marty v Estée Lauder [1980] ECR 2481, para 13; Case C-234/89 Stergios Delimitis v Henninger Braue AG [1991] ECR I-935, para 45; Case C-242/95 GT-Link AC v De Danske Statsbaner [1997] ECR I-4349, para 57; Case C-282/95 P Guerin Automobiles v Commission of the European Communities [1997] ECR I-1503, para 39.

37  This additional ‘dissuasive effect’ of damages actions was picked up by the ESC, which urged the Commission not to take measures that would induce excessive litigation: ESC, ‘Opinion on the Thirteenth Report on Competition Policy’ [1984] OJ C343/03, para 5; see also Commission (EC), Fourteenth Report on Competition Policy (Brussels, Luxembourg 1985) <http://bookshop.europa.eu/is-bin/INTERSHOP.enfinity/WFS/EU-Bookshop-Site/en_GB/-/EUR/ViewPublication-Start?PublicationKey=CB4184822> accessed 17 June 2014, para 47 where the Commission states that ‘[private enforcement] would allow the Commission’s staff to deal more rapidly with particularly complicated cases’.

38  Commission (EC), Fifteenth Report on Competition Policy (Brussels, Luxembourg 1986) <http://bookshop.europa.eu/is-bin/INTERSHOP.enfinity/WFS/EU-Bookshop-Site/en_GB/-/EUR/ViewPublication-Start?PublicationKey=CB4585430> accessed 17 June 2014, paras 38–39.

39  Commission (EC), ‘Notice on Cooperation between National Courts and the Commission in Applying Articles 85 and 86 of the EEC Treaty’ [1993] OJ C39/6, paras 4, 16; Commission (EC), ‘Notice on the Handling of Complaints by the Commission under Articles 81 and 82 of the EC Treaty’ [2004] OJ C101/65, paras 1, 13; Commission (EC), ‘Notice on the Cooperation between the Commission and the Courts of the EU Member States in the Application of Articles 81 and 82 EC’ [2004] OJ C101/54, para 4.

40  M Monti, ‘Effective Private Enforcement of EC Antitrust Law’ in CD Ehlermann and I Atanasiu (eds), European Competition Law Annual 2001: Effective Private Enforcement of EC Antitrust Law (Hart 2003) 3; J Sinclair, ‘Damages in Private Antitrust Actions in Europe’ (2002) 14 Loyola Consumer L Rev 547, 548.

41  Courage (n 6).

42  Ibid, paras 3–7.

43  Ibid, para 16.

44  This being ‘a fundamental requirement of the [Community] legal order’: Joined cases C-143/88 and 92/89 Zuckerfabrik AG v Hauptzollamt [1991] ECR I-415, para 26.

45  Courage (n 6), para 15.

46  Francovich (n 22), para 37. Courage has been viewed as the extension of Francovich in the area of individual liability. The question of individual liability for breach of the competition law rules was first answered by AG van Gerven: Banks (n 8), Opinion of AG van Gerven, paras 36–45. AG van Gerven suggests that the principle of individual liability is inherent in the system of the Treaty in the same way as the principle of State liability. Ibid, paras 39–41, 45. This formulation was clearer than that of Courage.

47  The majority of commentators accept that a Union right in damages exists; for example, see Komninos Assimakis, ‘New Prospects for Private Enforcement of EC Competition Law: Courage v Crehan and the Community Right to Damages’(2002) 39 CMLRev 447; A Komninos, EC Private Antitrust Enforcement—Decentralised Application of EC Competition Law by National Courts (Hart 2008) 172–176; W van Gerven ‘Harmonisation of Private Law: Do We Need It?’ (2004) 41 CMLRev 505, 520; S Drake, ‘Scope of Courage and the Principle of “Individual Liability” for Damages: Further Development of the Principle of Effective Judicial Protection by the Court of Justice’ (2006) 31 ELRev 841, 849; N Reich, ‘The “Courage” doctrine: Encouraging or Discouraging Violations for Antitrust Injuries?’ (2005) 42 CMLRev 35, 38; N Dunne, ‘The Role of Private Enforcement within EU Competition Law’ (2014) (University of Cambridge Faculty of Law Research Paper No 36/2014) <http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2457838> accessed 10 November 2014, 10–11; Contra C Miege, ‘Modernisation and Enforcement Pluralism’—: The Role of Private Enforcement of Competition Law in the EU and the German Attempts in the 7th Amendment of the GWB’ (2005) (Amsterdam Centre for Law and Economics, Workshop on Remedies and Sanctions in Competition Policy) 25–27; J Edelman and O Odudu, ‘Compensatory Damages for Breach of Article 81’ (2002) 27 ELRev 327, 336; O Odudu, ‘Effective Remedies and Effective Incentives in Community Competition Law’ (2006) 5 Comp Law 134, 141, fn 45; A Albors Llorens, ‘The Ruling in Courage v Crehan: Judicial Activism or Consistent Approach?’ (2002) 61 CLJ 38, 40–41; M Dougan, National Remedies before the Court of Justice (Hart 2004) 382–383; but see ibid, 386; See also Case T-395/94 Atlantic Container Line v Commission [2002] ECR II-875, para 414.

48  Case 6/64 Costa v ENEL [1964] ECR 585.

49  Van Gend en Loos (n 9); Courage (n 6), para 19. Note that in Francovich the Court began its reasoning in exactly the same way: Francovich (n 22), para 31.

50  Courage (n 6), paras 20–23.

51  Courage (n 6), para 24 (emphasis added).

52  M Brkan, ‘Procedural Aspects of Private Enforcement of EC Antitrust Law: Heading Toward New Reforms?’ (2005) 28 W Comp 479, 494.

53  See Courage (n 6), Opinion of AG Mischo, para 38.

54  D Leczykiewicz, ‘Private Party Liability in EU Law: In Search of the General Regime’ in C Barnard and O Odudu (eds), The Cambridge Yearbook of European Legal Studies—Volume 12, 2009-2010 (Hart 2010) 257, 278–279.

55  See R Nazzini, ‘Potency and Act of the Principle of Effectiveness: The Development of Competition Law Remedies and Procedures in Community Law’ in C Barnard and O Odudu (eds), The Outer Limits of the European Union (Hart 2009) 401, 405 for a different approach. He views effective enforcement of Articles 101 and 102 TFEU as the legal basis of the right to damages. The content and function of the right to damages are formulated based on the principle of effectiveness. Eilmansberger criticizes this legal basis and instead argues in favour of the adoption of the ‘protective scope’ theory. Eilmansberger (n 13) 1241.

56  Courage (n 6), Opinion of AG Mischo, para 37.

57  For a detailed account of remedies in common law legal systems see R Zakrzewski, Remedies Reclassified (OUP 2005).

58  Even if not expressly pronounced by the ECJ and despite the fact that the AG’s reasoning in the case suggests that no new EU remedy was created: see Courage (n 6), Opinion of AG Mischo, para 47. To the contrary, the fact that Courage provided for a Union remedy regarding damages can also be supported by Manfredi (n 7), Opinion of AG Geelhoed, paras 52–57, 63.

59  Unlike its AG and the ECJ in Francovich it did not refer to the principle of cooperation enshrined in [now] Article 4(3) TEU. See Courage (n 6), Opinion of AG Mischo, para 46; Francovich (n 22), para 36.

60  See also Eilmansberger (n 13) 1226–1228. In the same vein see J Drexl, ‘Competition Law as Part of the European Constitution’ in A von Bogdandy and J Bast (eds), Principles of European Constitutional Law (2nd edn, Hart 2009) 659, 677–678.

61  Courage (n 6), paras 25–26; cf Francovich (n 22), paras 32–33.

62  Courage (n 6), paras 26–27 (emphasis added).

63  Courage (n 6), para 20.

64  Komninos (n 17), 382.

65  Manfredi (n 7), paras 2, 20–21.

66  Ibid, para 63 (emphasis added).

67  Ibid, para 60.

68  See text to n 62 above.

69  Manfredi (n 7), paras 60, 90–91.

70  The Directive on Damages Actions focuses on ‘full compensation’ that should not amount to overcompensation, either by means of punitive or multiple damages: Directive on Damages Actions (n 3), recital 12 and Article 3. In the UK, the CAT awarded exemplary damages in 2Travel Group PLC (in Liquidation) v Cardiff City Transport Services Ltd [2012] CAT 19. In Manfredi, the Italian government argued that punitive damages were contrary to the Italian legal system (Manfredi (n 7), para 85); nonetheless, the referring court did award punitive damages: see Oxera, ‘Quantifying Antitrust Damages: Towards Non-binding Guidance for Courts’ (December 2009), Study prepared for the European Commission <http://ec.europa.eu/competition/antitrust/actionsdamages/quantification_study.pdf> accessed 26 July 2014, 94.

71  Case C-199/11 European Commission v Otis NV and Others [2013] 4 CMLR 4.

72  Ibid, para 24.

73  Ibid, paras 40–43.

74  Ibid, 77. On 24 November 2014 the Brussels Commercial Court subsequently dismissed the Commission claim for failing to prove the relevant damage and the causal link between the competition law infringement and the respective damage. See Stibbe, Competition Law Newsletter December 2014 <http://www.stibbe.com/en/news/2014/december/competition-law-newsletter-december-2014> accessed 2 December 2014. The Commission has announced its intention to appeal. See A Maton, ‘European Commission’s Damages Litigation Illustrates Challenges in Domestic Regimes Pre-implementation of the Damages Directive’ (Kluwer Competition Law Blog, 9 April 2015) <http://kluwercompetitionlawblog.com/2015/04/09/european-commissions-damages-litigation-illustrates-challenges-in-domestic-regimes-pre-implementation-of-the-damages-directive/#respond> accessed 10 April 2015.

75  Pfleiderer (n 31).

76  Ibid, para 29. See also Case T-344/08 EnBW Energie Baden-Württemberg AG [2012] 5 CMLR 4, paras 128, 148. On appeal Case C-365/12 P Commission v EnBW Energie Baden-Württemberg AG [2014] 4 CMLR 30, paras 104–108. The Court, on appeal, reversed the GC judgment placing the emphasis on ‘the effective protection of the right to compensation’ and stating that ‘[i]‌n the absence of any such necessity, the interest in obtaining compensation for the loss suffered as a result of a breach of Article [101 TFEU] cannot constitute an overriding public interest, within the meaning of Article 4(2) of Regulation No 1049/2001’. For more detail on this case, see Chapter 4, text to nn 145–153.

77  Case C-536/11 Bundeswettbewerbsbehörde v Donau Chemie AG and Others [2013] 5 CMLR 19, para 13.

78  Ibid, para 23.

79  Ibid, para 27.

80  Ibid, paras 32–34.

81  Ibid, para 46. Access to leniency documents has now been legislatively resolved in the Directive on Damages Actions. See Chapter 4, text to nn 169–170. The point made here is in relation to the Court stressing the deterrent potential of damages actions as opposed to their compensatory function.

82  Case T-437/08 CDC Hydrogen Peroxide v Commission [2011] ECR II-8251, para 77.

83  Case C-557/12 Kone AG and Others v ÖBB Infrastruktur AG [2014] 5 CMLR 5, para 17.

84  Ibid, paras 34, 37.

85  Ibid, para 32.

86  AG Kokott took a bolder stance than the Court, as she argued in her Opinion that national law determines the details rather than the existence of the right to damages and that the conditions of civil liability of cartel members for umbrella pricing are a matter of EU law. Kone (n 83), Opinion of AG Kokott, paras 23, 28.

87  In the same vein, see Kone (n 83), Opinion of AG Kokott, para 30. On this case see N Dunne, ‘It Never Rains but it Pours? Liability for “Umbrella Effects” under EU Competition Law in Kone’ (2014) 51 CMLRev 1813.

88  M Monti, ‘Private Litigation as a Key Complement to Public Enforcement of Competition Rules and the First Conclusions on the Implementation of the New Merger Regulation’ (Speech at IBA—8th Annual Competition Conference, Fiesole, 17 September 2004, SPEECH/04/403). In the same vein see also his successor N Kroes, ‘Enhancing Actions for Damages for Breach of Competition Rules in Europe’ (Speech at the Harvard Club, New York, 22 September 2005, SPEECH/05/553).

89  GP (n 3), para 1.1; GP SWP (n 8), paras 4–6, 179–180.

90  F Bulst, ‘Of Arms and Armour—The European Commission’s White Paper on Damages Actions for Breach of EC Antitrust Law’ [2008] Bucerius Law Journal 81, 82. See C Hodges, ‘Competition Enforcement, Regulation and Civil Justice: What is the Case?’ (2006) 43 CMLRev 1381, 1382 in which he suggests that the Commission’s approach towards private enforcement indicates its desire to use ‘civil damages claims as an additional regulatory control in deterring breaches of competition law’; C Hodges, Litigating Antitrust Claims in Europe: Proposals and Implications (National Legal Centre for the Public Interest 2006) 3.

91  WP (n 3), para 1.2; Commission (EC), ‘Staff Working Paper accompanying the White Paper on Damages actions for breach of the EC antitrust rules’ SEC(2008) 404, 2 April 2008 (WP SWP), paras 14–15.

92  WP SWP (n 91), para 16.

93  See D Waelbroeck, D Slater, and G Even-Shoshan, ‘Study on the Conditions of Claims for Damages in Case of Infringement of EC Competition Rules’ (Comparative Report) (Ashurst Study) (31 August 2004) <http://ec.europa.eu/competition/antitrust/actionsdamages/comparative_report_clean_en.pdf> accessed 30 June 2014, 77; Manfredi (n 7), para 87 for the submissions of the Austrian government. See also Danish Ministry for Economic and Business Affairs, ‘The Commission’s Green Paper on Damages Actions for Breach of the EC Antitrust Rules’ (19 April 2006); Secrétariat Général des Affaires Européennes, République Française, ‘Note à la Commission Européenne’. For an account of the Dutch situation see J Kortmann, ‘The Tort Law Industry’ (2009) 17 ERPL 789, 799, 810. Essentially, this echoes the principle of corrective justice, which inflicts a rectification duty upon the tortfeasor and it can be contrasted with the prevailing economic analysis underlying common law. See J Coleman, ‘The Practice of Corrective Justice’ in D Owen (ed), Philosophical Foundations of Tort Law (Clarendon Press 1995) 54, 57, 66. On the principle of corrective justice and the importance of a ‘bipolar relationship of liability’ as an important feature of private law relations see E Weinrib, The Idea of Private Law (Harvard University Press 1995) 2, 56–83, 114–144; J Coleman, ‘The Practice of Corrective Justice’, 67. See also J Kortmann and C Swaak, ‘The EC White Paper on Antitrust Damage Actions: Why the Member States are (Right to Be) Less than Enthusiastic’ (2009) 30 ECLR 340, 341 which argues that ‘in many European jurisdictions the instrumentalist view of tort law is a minority view’.

94  Commission (EC), ‘Proposal for a Council Directive Governing Actions for Damages for Infringements of Article 81 and 82 of the Treaty’, Draft Damages Directive (Document withdrawn before publication—on file with the author), Explanatory Memorandum, para 1.1.

95  For example, the proposal on opt-out collective actions (included in the WP and the Draft Damages Directive) supports the functional approach to private enforcement. Monti, in his Report on the single market, is also in favour of a functional approach to private enforcement. See M Monti, ‘A New Strategy for the Single Market’ (Report to the President of the European Commission, 9 May 2010), 102, 103.

96  Proposal for a Directive on Damages Actions (n 3), para 1.2.

97  Directive on Damages Actions (n 3), recitals 1, 3.

98  On the bifurcated functions of private competition law enforcement see W Wils, ‘The Relationship Between Public Antitrust Enforcement and Private Actions for Damages’ (2009) 32 W Comp 3, 5. For empirical evidence on the beneficial compensatory and deterrent effects of private enforcement see R Lande and JP Davis, ‘Benefits From Private Antitrust Enforcement: An Analysis of Forty Cases’ (2008) University of San Francisco Law Review 879; R Lande and JP Davis, ‘Toward an Empirical and Theoretical Assessment of Private Antitrust Enforcement’ (2013) University of San Francisco Law Research Paper No 2012-17 <http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2132981> accessed 30 June 2014.

99  For a definition see Komninos (n 47), 6–7.

100  Cf W van Gerven, ‘Private Enforcement of EC Competition Rules in the ECJ—Courage v Crehan and the Way Ahead’ in J Basedow (ed), Private Enforcement of EC Competition Law (Kluwer Law International 2007) 19, 24; FW Bulst, ‘Private Antitrust Enforcement at a Roundabout’ (2006) 7 EBOR 725, 729. However, a quantitative analysis of the competition law litigation in different Member States suggests that the majority of relevant actions concern stand-alone claims. See B Rodger, ‘The Empirical Data Part 1: Methodology, Case Law, Courts and Processes’ in B Rodger (ed), Competition Law, Comparative Private Enforcement and Collective Redress Across Europe (Kluwer Law International 2014) 83, 110–116. This can be explained in the light of the nature of competition claims. For example, in Portugal, competition law was invoked as a defence or in the context of vertical agreements. See also V Brisimi and M Ioannidou, ‘Stand-alone Damages Actions: Insights from Greece and Cyprus’ (2013) 34 ECLR 654. In Italy, 75% of damages cases are stand-alone. See A Komninos, ‘Private Enforcement in the EU with Emphasis on Damages Actions’ in I Lianos and D Gerardin (eds), Handbook on EU Competition Law: Enforcement and Procedure (Edward Elgar 2013) 228, 247.

101  M Harker and M Hviid, ‘Competition Law Enforcement and Incentives for Revelation of Private Information’ (2008) 31 W Comp 297; T Eilmansberger, ‘The Green Paper on Damages Actions for Breach of the EC Antitrust Rules and Beyond: Reflections on the Utility and Feasibility of Stimulating Private Enforcement through Legislative Action’ (2007) 44 CMLRev 431, 478.

102  See B Rodger, ‘Institutions and Mechanisms to Facilitate Private Enforcement’ in B Rodger (ed), Competition Law, Comparative Private Enforcement and Collective Redress Across Europe (Kluwer Law International 2014) 23, 33.

103  Nokia AU Optronics and others [2012] EWHC 731 (Ch), paras 20–25.

104  Ibid, 62.

105  Ibid, 67. See also Toshiba Carrier UK Ltd v KME Yorkshire Ltd [2012] EWCA Civ 1190, para 32.

106  Toshiba Carrier (n 105).

107  Ibid, paras 37–40. See also Provimi Ltd v Aventis Animal Nutrition SA and others [2003] 2 All ER 683, paras 31–32; Cooper Tire and Rubber Company v Shell Chemicals UK [2010] EWCA Civ 864, paras 43–44.

108  Directive on Damages Actions (n 3), recital 6; Commission (EU), ‘Damages Actions for Breach of the EU Antitrust Rules’ (Impact Assessment Report) SWD (2013) 203 final, para 2.

109  Article 6(6) of the Directive on Damages Actions (n 3) on non-disclosure of leniency statements; Article 11(4) limiting the joint and several liability of the immunity applicant. The interplay between damages actions and public enforcement in follow-on litigation raises complex questions that remain unresolved in the Directive on Damages Actions, such as the calculation of the limitation period in follow-on actions when multiple infringers are involved and some appeal the decision and others not and the impact on leniency incentives. See P Akman, ‘Period of Limitations in Follow-on Competition Cases: When Does a “Decision” Become Final?’ (2014) 2 JAE 389. On the period of limitation and follow-on actions see Deutsche Bahn AG and others v Morgan Crucible Company plc [2014] UKSC 24.

110  For an early US account see T Kauper and E Snyder, ‘An Inquiry into the Efficiency of Private Antitrust Enforcement: Follow-on and Independently Initiated Actions Compared’ (1986) Geo LJ 1163, 1222. M Block, FC Nold, and J Sidak, ‘The Deterrent Effect of Antitrust Enforcement’ (1981) 89 J Pol Econ 429, 444.

111  Hydrogen Peroxide and Perborate (Case COMP/F/38.620) Commission Decision of 5 June 2006, C(2006) 1766 final.

112  See <http://www.carteldamageclaims.com/portfolios/cdc-hydrogen-peroxide/>. In Finland, the case was settled on 19 May 2014 for a total amount of €18.5 million instead of the initially claimed €78 million. See <http://www.kemira.com/en/newsroom/whats-new/Pages/1786726_20140519073136.aspx>. See also E Waektare, ‘Private Enforcement: Antitrust Damage Settlement between Claimant CDC and Hydrogen Peroxide Cartellist Kemira (Finland)’ (2014) 5 JECLAP 701. Proceedings in Germany are pending following a preliminary question to the ECJ (Case C-352/13 CDC Hydrogen Peroxide).

113  The rationality assumption is one of the basic principles of the Chicago School: see R Posner, ‘The Chicago School of Antitrust Analysis’ (1979) 127 U Pa L Rev 925.

114  Here, increasing potential costs is taken to mean increasing the amount of damages. For reasons for not allowing fines to be raised beyond a certain standard see W Wils, Efficiency and Justice in European Antitrust Enforcement (Hart 2008) 62.

115  See N Kroes, ‘Consumers at the heart of EU Competition Policy’ (2008) (Speech at BEUC, 22 April 2008, Speech 08/212).

116  Kauper and Snyder (n 110) 1169.

117  Jones argues that competition authorities proceedings most often take place because of private complaints. See C Jones, ‘Into the Parallel Universe: Procedural Fairness in Private Litigation after the Damages Directive’ (2014, 9th ASCOLA Conference Warsaw) <http://www.ascola-conference-2014.wz.uw.edu.pl/conference_papers/Jonesascola2014.pdf> accessed 22 July 2014.

118  W Wils, ‘Should Private Antitrust Enforcement Be Encouraged in Europe?’ (2003) 26 W Comp 473, 482; Wils (n 114) 9; C Hodges, ‘Competition Enforcement, Regulation and Civil Justice: What is the Case?’ (2006) 43 CMLRev 1381, 1395; For the opposite view see OFT, ‘Private Actions in Competition Law: Effective Redress for Consumers and Business’ (Recommendations) (OFT 916resp, November 2007), para 2.3 where it is stated that when the OFT asked companies and their advisers for suggestions as to what could be done to improve compliance with competition law in the UK, the most frequent responses included encouraging private damages actions.

119  W Baumol and J Ordover, ‘Use of Antitrust to Subvert Competition’ (1985) 28 JL & Econ 247, 248 where they point out that ‘attempts to use the law as an instrument of subversion do not confine themselves to private lawsuits’; W Breit and K Elzinga, ‘Private Antitrust Enforcement: The New Learning’ (1985) 28 JL & Econ 405, 433; E Snyder and T Kauper, ‘Misuse of the Antitrust Laws: The Competitor Plaintiff’ (1991) 90 Mich L Rev 551; P McAfee, H Mialon, and S Mialon, ‘Private Antitrust litigation: Procompetitive or Anticompetitive’ (2005) Emory Law and Economics Research Paper No 05/18 <http://papers.ssrn.com/sol3/papers.cfm?abstract_id=784805> accessed 5 August 2014.

120  See text to n 10. For a contrary opinion see BDI, ‘Position—Commission White Paper on Damages Actions for Breach of the EC Antitrust Rules’ <http://ec.europa.eu/competition/antitrust/actionsdamages/white_paper_comments/bdi_en.pdf> accessed 5 August 2014; CBI, ‘Damages Actions for Breach of the EC Antitrust Rules—CBI Response to the Commission White Paper’ <http://ec.europa.eu/competition/antitrust/actionsdamages/white_paper_comments/cbi_en.pdf> accessed 5 August 2014, 2.

121  D Kelemen, ‘Suing for Europe: Adversarial Legalism and European Governance’ (2006) 39 Comparative Political Studies 101, 121 which argues that private parties can strengthen European policies.

122  A fact accepted by the Commission: see WP SWP (n 91), para 313; See also OECD, ‘Remedies Available to Private Parties under Competition Laws’ (Report) COM/DAFFE/CLP/TD(2000)24/Final, para 3.

123  G Becker, ‘Crime and Punishment: An Economic Approach’ (1968) 76 J Pol Econ 169; G Becker and G Stigler, ‘Law Enforcement, Malfeasance and Compensation of Enforcers’ (1974) 3 J Legal Stud 1; W Landes and R Posner, ‘The Private Enforcement of Law’ (1975) 4 J Legal Stud 1; W Landes, ‘Optimal Sanctions for Antitrust Violations’ (1983) 50 U Chi L Rev 652, 656, 678. See also I Lianos, ‘Competition Law Remedies in Europe—Which Limits for Remedial Discretion?’ (2013) CLES Research Paper Series <https://www.ucl.ac.uk/cles/research-paper-series/index/edit/research-papers/cles-2-2013> accessed 17 August 2014, 29–30.

124  See Wils (n 114) 56–58 which points to differences between the ‘internalization approach’ advocated by Becker and Landes (n 123) and the ‘deterrence approach’.

125  C Jones, Private Enforcement of Antitrust Law in the EU, UK and USA (OUP 1999) 186–187; M Brealy, ‘Adopt Perma Life, but Follow Hannover Shoe to Illinois?’ (2002) 1 Comp Law 127, 133; A Komninos, ‘The Road to the Commission’s White Paper for Damages Actions: Where We Came From’ (2008) 4 CPI <https://www.competitionpolicyinternational.com/the-road-to-the-commissions-white-paper-for-damages-actions-where-we-came-from/> accessed 28 July 2014, 81, 101.

126  W Schwartz, ‘An Overview of the Economics of Antitrust Enforcement’ (1980) 68 Geo LJ 1075, 1086; W Schwartz, Private Enforcement of Antitrust Laws: An Economic Critique (American Enterprise Institute for Public Policy Research 1981) 31, 32.

127  Komninos (n 47) 10; C Jones, ‘Private Antitrust Enforcement in Europe: A Policy Analysis and Reality Check’ (2004) 27 W Comp 13, 14.

128  See EESC (EC), ‘Defining the Collective Actions System and Its Role in the Context of Community Consumer Law’ (Opinion) [2008] OJ C162/1, 3, 14.

129  C Hodges, The Reform of Class and Representative Actions in European Legal Systems (Hart 2008) 188.

130  Cf European Justice Forum, ‘Comments on the Commission White Paper’ <http://ec.europa.eu/competition/antitrust/actionsdamages/white_paper_comments/eurjfor_en.pdf> accessed 5 August 2014, para 1; D Shapiro, ‘Consumer Class Actions Made Easy’ (2008) 7 Comp Law 203, 207.

131  Commission (EC), ‘Consumer Policy Strategy 2002–2006’ (Communication) COM(2002) 208 final, OJ [2002] C137/02, para 3.3.2.2; Commission (EC), ‘EU Consumer Policy Strategy 2007–2013’ (Communication) COM(2007) 99 final, 8, 11; Regulation (EU) No 254/2014 of the European Parliament and of the Council of 26 February 2014 on a Multiannual Consumer Programme for the Years 2014–20 and Repealing Decision No 1926/2006/EC [2014] OJ L84/42, Article 2, Article 3(1)(b). For a UK account see DTI, ‘Extending Competitive Markets: Empowered Consumers, Successful Business’ (June 2005), para 5.

132  M Waterson, ‘The Role of Consumers in Competition and Competition Policy’ (2001) Warwick Economic Research Papers No 607 <http://www2.warwick.ac.uk/fac/soc/economics/research/workingpapers/publications/twerp607.pdf> accessed 5 August 2014.

133  J Vickers, ‘Healthy Competition and its Consumer Wins’ (2002) 12 CP Rev 142, 146.

134  See to that end mandatory information disclosure and harmonized rules to protect consumers’ health and safety: Consumer Policy Strategy 2002–2006 (n 131), para 2.

135  See Ioannidou (n 5) 68.

136  K Cseres, ‘What Has Competition Done for Consumers in Liberalised Markets?’ (2008) 4 Comp L Rev <http://www.clasf.org/CompLRev/Issues/Vol4Iss2Art1Cseres.pdf> accessed 5 August 2014, 77.

137  Commission (EC), ‘Proposal for a Directive of the European Parliament and of the Council on Consumer Rights’ COM(2008) 614 final, 8 October 2008.

138  Cseres (n 136) 91 with further references. G Howells, ‘The Potential and Limits of Consumer Empowerment by Information’ (2005) 32 JL & Soc 349, 356–362.

139  See Commission (EU), ‘Consumer Empowerment in the EU’ (Staff Working Paper) SEC(2011) 469 final, para 3 on consumer empowerment depending on accessible means of redress. However, this document addresses consumer empowerment only as a consumer law matter.

140  O Dayagi-Epstein, ‘Furnishing Consumers with a Voice in Competition Policy’ (2005) <http://www.luc.edu/media/lucedu/law/centers/antitrust/pdfs/publications/workingpapers/dayagi_epstein_consumers_voice.pdf> accessed 5 August 2014.

141  Commission (EC), ‘European Governance’ (White Paper) COM(2001) 428 final (Governance White Paper), Executive Summary 2. The Governance White Paper defines ‘governance’ as the rules, processes, and behaviour that affect the way in which powers are exercised at European level, particularly with regard to openness, participation, accountability, effectiveness, and coherence. Ibid, n 1. See H Hartnell, ‘EUstitia: Institutionalising Justice in the European Union’ (2002) 23 Nw J Int’l L &Bus 65, 128 which points to the different meanings of ‘governance’.

142  Governance White Paper (n 141) 14. See also Commission (EU), ‘Single Market Act—Twelve Levers to Boost Growth and Strengthen Confidence’ (Communication) COM(2011) 206 final, 20; K Armstrong, ‘Rediscovering Civil Society: The European Union and the White Paper on Governance’ (2002) 8 ELJ 102 for a critical account of the notion of civil society in the Governance White Paper. On the notion of civil society see also S Smismans, ‘Civil Society and European Governance: from Concepts to Research Agenda’, in S Smismans (ed), Civil Society and Legitimate European Governance (Edward Elgar 2006) 3.

143  See Articles 10(3) and 11 TEU; BEUC, ‘Response to the White Paper on Governance’ (28/03/2002, BEUC/156/02).

144  For a criticism of these new forms of governance see T Idema and D Kelemen, ‘New Modes of Governance, the Open Method of Co-ordination and Other Fashionable Red Herring’ (2006) 7 Perspectives on European Politics and Society 108.

145  F Cafaggi and H Muir-Watt, ‘Introduction’ in F Cafaggi and H Muir-Watt (eds), Making European Private Law: Governance Design (Edward Elgar 2008) 7; G de Burca and J Scott, ‘Introduction: New Governance, Law and Constitutionalism’ in G de Burca and J Scott (eds), Law and New Governance in the EU and US (Hart 2006).

146  De Burca and Scott (n 145) 3.

147  See, for example, Directive 2013/11/EU on Alternative Dispute Resolution for Consumer Disputes and Amending Regulation (EC) 2006/2004 and Directive 2009/22/EC [2013] L 165/63; Regulation (EU) No 524/2013 on online dispute resolution for consumer disputes and amending Regulation (EC) No 2006/2004 and Directive 2009/22/EC (Regulation on Consumer ODR) [2013] L165/1.

148  Council Directive 2004/35/EC of 21 April 2004 on environmental liability with regard to the prevention and remedying of environmental damage [2004] OJ L143/56.

149  GP (n 3); WP (n 3); Directive on Damages Actions (n 3).

150  D Kelemen, ‘Americanisation of European Law? Adversarial Legalism à la européenne’ (2008) 7 European Political Science 32 in which the author examines whether the adversarial legalism approach can be transposed to the EU.

151  R Kagan, Adversarial Legalism: The American Way of Law (Harvard University Press 2001) 7–8.

152  R Kagan, ‘American and European Ways of Law: Six Entrenched Differences’ in V Gessner and D Nelken (eds), European Ways of Law: Towards a European Sociology of Law (Hart 2007) 41, 57.

153  These three variables are identified by Kelemen as evidence of the advent of adversarial legalism in the EU: Kelemen (n 121) 103.

154  See A Estella de Noriega, The EU Principle of Subsidiarity and its Critique (OUP 2002) 37–53 on the concept of legitimacy.

155  See F Scharpf, ‘Economic Integration, Democracy and the Welfare State’ (1997) JEPP 18, 19. Scharpf places increased emphasis on output legitimacy. In the same vein see A Menon and S Weatherill, ‘Legitimacy, Accountability, and Delegation in the European Union’ in Arnull and Wincott (eds), Accountability and Legitimacy in the European Union (OUP 2002) 113. See also Wincott, ‘The Governance White Paper, the Commission and the Search for Legitimacy’ in A Arnull and D Wincott (eds), Accountability and Legitimacy in the European Union (OUP 2002) 379, 380 which states that ‘legitimacy might be improved if the peoples of Europe were better served by and/or more fully involved in the Union’. To the contrary, Craig underlines the importance of input legitimacy as well. See P Craig, ‘Integration, Democracy and Legitimacy’ in P Craig and G de Burca (eds), The Evolution of EU Law (2nd edn, OUP 2011) 13, 39–40.

156  Foreword by Emil Paulis in D Ashton and D Henry, Competition Damages Actions in the EU—Law and Practice (Edward Elgar 2013). For a distinction between the citizen’s role and the consumer’s role see M Hesselink, ‘European Contract Law: A Matter of Consumer Protection, Citizenship or Justice?’ in S Grundmann (ed), Constitutional Values and European Contract Law (Kluwer Law International 2008) 241, 248, 262–264. On concepts of citizenship see J Davies, The European Consumer Citizen in Law and Policy (Palgrave Macmillan 2011) 78–87. On EU citizenship evolving from market citizenship see MP Maduro, ‘Europe’s Social Self: “The Sickness Unto Death” ’ in J Shaw (ed), Social Law and Policy in an Evolving European Union (Hart 2000) 325, 332–340. See also M Everson, ‘The Legacy of the Market Citizen’ in J Shaw and G More (eds), New Legal Dynamics of European Union (Clarendon Press 1995) 73; NN Shuibhne, ‘The Resilience of EU Market Citizenship’ (2010) 47 CMLRev 1597.

157  W van Gerven, The European Union. A Polity of States and People (Hart 2005) 200.

158  This participation element can be seen as an aspect of the ‘consumer citizen’. On this term see Davies (n 156) 90.

159  B Van Rompuy, ‘How to Preserve Trust in Anti-Trust’ (EUbusiness, 8 October 2009) <http://www.eubusiness.com/Members/bvrompuy/competition-day> accessed 30 June 2014.

160  K Cseres, Competition Law and Consumer Protection (Kluwer Law International 2005) 3, 202.

161  M Arkenstette, ‘Reorientation in Consumer Policy—Challenges and Prospects from the Perspective of Practical Consumer Advice Work’ (2005) 28 JCP 361, 368.

162  See, for example, Article 11(4) TEU which introduces the European Citizens’ Initiative.

163  Brasserie du Pêcheur (n 22), Opinion of AG Tesauro, para 47.