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Summary of the Hannover Truck Cartel Ruling

| News | Anti-Trust Law and European Union Law

Isabel Martínez Moriel analyses the ruling on the Hannover truck cartel

On 18 December 2017, the Regional Court of Hanover handed down the first ruling in Germany on the damages resulting from the cartel of truck manufacturers. The applicant is a public-law entity, the municipality of Göttingen, which, following a call for tenders, purchased a number of vehicles from the manufacturer MAN for waste collection and for its fire brigade.

This judgment is of great interest, not because it is the first to recognise the existence of a surcharge caused by the manufacturers' agreement, if not because it clarifies the scope of the principle of presumption of the existence of damage caused by cartel behaviour, introduced in Directive 2014/104/EU on the bringing of damaging actions and infringement of competition law.

Consequently, the judgment also defines the possibility of defence for manufacturers who invoke the passing on principle or defence theory based on the knock-on effect of extra cost on third party purchasers of the service. On one hand, it confirms that whenever there is cartel behaviour it is presumed that the purchaser of the product concerned has paid a surcharge, even if, as in the present case, the purchase and sale prices paid by the applicant did not correspond to the gross list prices, on the increase of which the cartel would have reached an agreement.

Thus, as the Court understands, it is prima facie presumed that the basis on which the vehicles are negotiated or offered - as was the case here - are the gross list prices. Therefore, an agreement on gross prices in the product catalogue that infringes the cartel rules also has an impact on individual customer prices, irrespective of whether and to what extent specific customer, market, order or vehicle factors have also been taken into account in the negotiation of individual customer prices.

With regard to the specific overpricing that the plaintiff would have suffered, the Court does not enter into its assessment, inasmuch as the compensation requested by the plaintiff responded to the penalty included in the general conditions of the contract of sale of the tender for those cases in which the seller had committed an infringement of Competition Law.

On the other hand, the Court limits the possible defence of the cartel based on the evidence of the impact of the price increase on third party users of the cartel service or product. Thus, it argues that the possible impact of the economic damage caused by the cartel does not preclude the creation of damage or reduce it, so that the damage has occurred despite a subsequent resale.

Therefore, it can only be considered to be proven that the damage has been minimised or excluded if the defendant is able to prove that the price supplement imposed by the cartel is passed on to his customers from the point of view of any 'compensation of profits' and that the losses suffered by the buyer do not offset this impact.

In this case, it seems clear that, since the vehicles were obtained for the provision of public services, it is not even likely that the municipality of Göttingen would have passed on to the citizens the cost incurred or shared the benefits of the increased value of the vehicles purchased.


Factual Background to the Ruling

The applicant seeks compensation from the defendant for the damage which would have been caused to it by the so-called truck cartel found by the EU Commission in the purchase of trucks between 2001 and 2010.

The applicant is a public-law entity. It carries out its activities on behalf of the company in Germany as a concessionary company. As the extract from the Commercial Register, Section B, of the Munich District Court, submitted by the defendant, shows, the defendant initially had a name; the company's object was the management of housing and real estate for the partner and for third parties, as well as the provision of all related services.

According to the agreement on 16th April 2003, resolution of the General Meeting of Shareholders on 16th April 2003 and resolution of the General Meeting of the transferring company on 16th April 2003, the defendant took over the business area Geschäftseinheit Vertrieb Lkw Deutschland (German Truck Distribution Business Unit). The change to the new name was registered in the Commercial Register on 6.5.2003. The current name was entered in the Commercial Register on 11.1.2007 - extract from the Commercial Register, Annex HM 30, folios 771-786 of the application.

By the decision of 19-07-2016 (Case AT 39824 - Trucks), the European Commission found that truck manufacturers had been involved in exchanges over the period 1997-2010 on prices and gross list price increases in order to coordinate gross prices in the European Economic Area (EEA). Thus removing uncertainties regarding the behaviour of other manufacturers.

The collusive practices would have served a single economic purpose, namely the distortion of pricing and of the normal price movements of heavy goods vehicles in the EEA. These practices would have affected lorries of between 6 and 16 t - medium tonnage lorries - and lorries of more than 16 t - heavy lorries - and both rigid and articulated tractors.

Conversely, the aftermarket, other services and guarantees for lorries, the sale of used lorries and all other goods or services sold by the addressees of this decision would not have been affected by the aforementioned practices.


For further information, please contact:

Isabel Martínez Moriel

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