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Private Enforcement

The Damages Lie in the Details: Why the Proposed Directive Fails in Harmonizing Incentives to Sue Across the European Union

Hans W. Friederiszick, CPI Antitrust Chronicle, August 2013 (1).

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One of the two main objectives of the proposed EU Directive ("EU Directive") is to ensure effective compensation of victims of infringements of EU competition rules. Effective compensation throughout Europe has two components: first, an average level of compensation in the European Union that matches the average amount of damages ("Effectiveness Objective"); second, a regional distribution of awarded damages that reflects the regional distribution of harm in Europe ("Harmonisation Objective").

In the following, we argue that the EU Directive will potentially achieve its first goal, i.e. the Effectiveness Objective, but may fall short of the second one, the Harmonisation Objective. For the example of the passing-on defense and interest payments, we substantiate our claim by showing that major options remain unspecified and, hence, depend on actual national court practice. To the extent that the decision of where to bring a case has implications on: i) which cases are brought, ii) which firms are sued, and iii) which customers are compensated, this will also have an impact on the regional distribution of damages awarded and the regional location of firms paying the damages.

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