Case C-352/13, CDC Hydrogen Peroxide

Gabriela Edreva [1]

CDC Hydrogen Peroxide is the first case in which the Court has adjudicated directly on the interaction between the provisions of EU primary law on freedom of competition and the provisions of EU private international law on jurisdiction in civil and commercial matters (Regulation No 44/2001/EC).

The case concerns the famous hydrogen peroxide cartel, sanctioned by the European Commission in 2006. The cartel agreement was committed in several Member States and its many participants have participated in it in different places and at different times.

However, according to the Commission’s decision, it represents a single and continuous infringement of competition law provisions.

CDC is a litigation funding vehicle representing 71 injured parties from different member states. In 2009 it brought an action for damages before the referring German court jointly against six undertakings which had participated in the cartel. The defendants in the main proceedings contended that the referring court had no jurisdiction to hear the case. Moreover, before the expiry of the periods prescribed by the court for lodging a defence, CDC withdrew its action against the only defendant domiciled in Germany upon agreement with the latter. Moreover, some of the sales contracts by which the cartellists were bound to the alleged victims, provided for various agreements on arbitration and jurisdiction.

The Court’s decision leaves room for forum shopping by providing applicants with the option in similar cases to choose between:

(i) the courts of a Member State where any one of the defendants is domiciled, even where the applicant has withdrawn its action against the sole co-defendant domiciled in the same State as the court seized, unless it is found that, at the time the proceedings were instituted, the applicant and that defendant had colluded to artificially fulfil, or prolong the fulfilment of, that provision’s applicability;

(ii)  the courts of the place in which the cartel was definitively concluded, or, as the case may be, the place in which one agreement in particular was concluded which is identifiable as the sole causal event giving rise to the loss allegedly suffered;

(iii) the courts of the place where its own registered office is located.

The Court’s CDC Hydrogen Peroxide decision therefore removes hurdles to private enforcement, and, in the context of the implementation of Directive 2014/104/EU (so-called EU Antitrust Damages Actions Directive) is expected to bring about a rise of private enforcement in the EU.

It is interesting to note that the Court allows derogation of the aforementioned rules on jurisdiction by jurisdiction clauses contained in supply contracts, “provided that those clauses refer to disputes concerning liability incurred as a result of an infringement of competition law”. However, as anticompetitve practices, and, in particular, cartels, are secret by their very nature, it is hard to imagine that undertakings would be willing to include such clauses in their contracts.

It is also worth mentioning that the Court did not answer a part of the referring court’s question regarding possible derogation of the aforementioned rules on jurisdiction by arbitration clauses, by reformulating that question.

Therefore, it can be concluded that in its CDC Hydrogen Peroxide decision, the Court provides a large variety of choices to victims of antritrust infringements as to the court that could hear their case, while, at the same time, it implicitly refused to provide a method that would allow perpetrators to anticipate the possible jurisdictional implications of private litigation.

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Линк към статията на български език: МЕЖДУНАРОДНА КОМПЕТЕНТНОСТ ПРИ ИСКОВЕ ЗА ОБЕЗЩЕТЕНИЕ ЗА ВРЕДИ ОТ ТРАНСГРАНИЧНИ АНТИКОНКУРЕНТНИ ПРАКТИКИ

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[1]Attorney-at-law, Pavlov and Partners Law Firm in cooperation with CMS Reich-Rohrwig Hainz.