Legal Alert – Finnish Implementation of the Damages Directive Presents Stricter Approach than Required
A working group of the Ministry of Employment and the Economy has published its proposal on the Finnish Act on Competition Law Damages Actions. In addition to implementing the Damages Directive 2014/104/EU into national legislation, the proposal contains suggestions and interpretations that go further than required by the Damages Directive.
Firstly, non-cross border infringements, i.e. infringements without effects on trade between Members States, are also to be included in the scope of the new act. This diminishes uncertainty since it is not necessary to solve the preliminary question on trade effects in competition damages cases.
Secondly, the Finnish draft law suggests that the financial succession is also to be applied to competition law damages claims. In accordance with established case law, a third party undertaking may be ordered to be responsible for a penalty payment in certain circumstances. The Finnish draft law would apply this rule to an acquirer of business in damages cases: the party acquiring the business could be jointly responsible for damages in case the acquiring party knew or should have known of the infringement. This awareness requirement deviates from the succession rule on penalty payments.
The Damages Directive states that a court shall not order a party to disclose a leniency application in the civil proceedings. Naturally, it is important that the status of the leniency application is secured in order to protect the attractiveness of the leniency system. However, the Finnish draft law goes further: It states that a civil court handling a damages claim cannot utilize a leniency application as evidence in a damages case at all. It appears that even a party that has obtained leniency could not use its own application in its defence. Indeed, this can be necessary in certain circumstances since there are very different cartels: Cartels are sometimes organized in structured ways but occasionally a mere attendance of sensitive price discussion within industrial organisations is viewed as a cartel. In the latter case it could sometimes be in the leniency applicant’s interest to show the true nature of the cartel and to disclose the leniency application in the civil proceedings given the presumption of caused damages.
A consultation round regarding the act proposal has been launched in June, and interest groups may present their statements by 11 September 2015. The new legislation shall enter into force at the latest on 27 December 2016.