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Italy: Compensation for Damages Arising from Antitrust Violations

(Feb. 10, 2017) On February 3, 2017, new legislation governing judicial procedures for the recovery of damages arising from antitrust violations entered into effect in Italy. (Legislative Decree No. 3 of January 19, 2017 Implementing EU 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 (L.D. No. 3), GAZZETTA UFFICIALE (Jan. 19, 2017), NORMATTIVA (in Italian); EU Directive 2014/104, EUR-LEX.)

Damage Claims

The legislation regulates the right to compensation for damages caused by a violation of an antitrust law or regulation by a single company or an association of companies. (L.D. No. 3, art. 1(1).) The compensation is for actual damages and lost profits and interest; compensation over the amount of the actual damages is not included.  (Id. art. 1(2).)  A defendant in an action for damages can argue that the party claiming the damage has passed on the cost of the infringement to a third party.  (Id. art. 10(2) & EU Directive 2014/104.) However, the plaintiff may sue for the compensation of lost profits arising from the total or partial transference of the overcharge resulting from the violation, that is, for the higher price paid by the plaintiff that he did not transfer to his next customer in the supply chain.  (Id. art. 10(2).)

During damage claim procedures based on antitrust violations, the judge may include damage claims initiated in other EU Member States when such claims relate to the same antitrust violations, despite the fact that the claims have been initiated by plaintiffs located at different levels of the supply chain. (Id. art. 13(1).)

Damage claims based on an alleged violation of antitrust law must be reasonably founded and be supported by evidence sufficient to demonstrate the plausibility of the claim. (Id. art. 3(1).)  The judge may order the production of relevant evidence that includes a description, with particulars, of the elements of proof necessary to decide on the damage claim.  (Id. art. 3(2).)  If the claim involves access to confidential information of one of the parties, the judge may order specific measures to protect such information.  (Id. art. 3(4).)

The valuation of antitrust claims must be determined in accordance with the Civil Code. (Id. art. 14(1).)  The new law establishes a rebuttable presumption of the existence of damages when an antitrust violation has been caused by a cartel. (Id. art. 14(2).)

Production of Evidence in the Purview of Governmental Authorities

Under the new legislation, a judge may order the production of evidence necessary to substantiate a claim that is within the purview of the governmental authority in charge of guaranteeing competition law, based on a proportionality analysis that weighs the criteria established by the legislation. (Id. art. 4(1)-(3).)  The judge may not order a party to the case or a third party to produce evidence whose purpose is to obtain a declaration that arises from a leniency program or a proposed compromise.  The purpose of this provision is to protect the confidentiality of exchanges during extra-judicial settlement procedures.  (Id. art. 4(5).)  Only a party who has obtained evidence from the governmental authorities in a manner established by law may use it during the proceedings for a damage claim.  (Id. art. 5.)

The legislation establishes administrative fines for the parties to a judicial dispute or for third parties who unjustifiably refuse to comply with evidence production orders issued by the presiding judge. (Id. art. 6.)

Effects of Decisions on Violation of Antitrust Law

Decisions made by the governmental authority in charge of guaranteeing competition law or the judge establishing the existence of an antitrust violation are final and produce res judicata effects.  (Id. art. 7(1).)

Statute of Limitations 

An action to claim damages arising from a violation of antitrust laws expires within five years from the date when the alleged violation ceases to produce effects, provided that the plaintiff knows or may be deemed to reasonably know of the elements established in the law. (Id. art. 8(1).)  These elements include: (a) knowledge that the respective conduct and facts constitute a violation of antitrust law; (b) knowledge that the violation has caused damage to the plaintiff; and (c) knowledge of the identity of the author of the violation.  (Id. art. 8(1).)  The term of the statute of limitations is suspended when the governmental authority in charge of guaranteeing competition law begins an investigation or institutes a procedure concerning the damage claim.  (Id. art. 8(2).)  The suspension lasts for one year from the moment when the government decision related to the violation of an antitrust law becomes final, or otherwise after the procedure is closed.  (Id. art. 8(2).)

Joint and Several Civil Liability of Small and Medium-Size Enterprises for Antitrust Violations 

The new legislation amends the Civil Code to limit the joint and several liability of small- and medium-size entreprises for antitrust violations that cause damage to direct purchasers, and also to indirect purchasers provided that the participation of those companies in the relevant market is less than 5% during the period of the violation.  (Id. art. 9(1).)  Additionally, the new legislation requires that for joint and several liability to exist in a given case, the existence of irreparable injury to the companies’ financial strength and the total loss of value of their activities would meets the standards set in general civil liability rules.  (Id. art. 9(1); Codice Civile [Civil Code], ALTALEX, art. 2055 ¶ 1 (scroll down the list of articles in the left-hand column and click on hyperlink to view).)

Effects of the Consensual Resolution of a Dispute 

At the request of the parties, the judge may suspend, for a maximum of two years, pending procedures for the compensation of damages arising from antitrust violations when the parties have requested the use of procedures for the consensual resolution of the dispute. (Id. art. 15(2).)  In cases of consensual resolution, the plaintiff who reaches an agreement with the defendant may not recover damages from a third party who has also allegedly incurred the violation but who has not participated in the agreement.  (Id. art. 16(2).)