Cartel damages

Cartels can cause damage. Whether and to what extent such damage has occurred requires a differentiated economic analysis.

Quantifying cartel damages using appropriate analytical methods is a basic prerequisite for successful private enforcement of antitrust law. Analysing the effects of cartels requires extensive expertise embedded in legal requirements. EE&MC has this specific interdisciplinary know-how. Based on years of experience and knowledge of various damage theories, we can include all competition parameters, such as quality, prices, quantity and costs, in our analyses. 

The estimation of cartel damages is carried out by competition economists with interdisciplinary training. 

Within the framework of "public enforcement", cartels are fined by the European Commission or national antitrust authorities. In relation to the damage that such cartels cause to the economy, the amount of the fines is manageable. The activities of the injured companies are referred to as "private enforcement".

As a rule, injured parties have mostly paid excessive prices to the cartel members during the cartel period. The cartel members must compensate for the damages caused by the cartel. The claim for compensation includes not only compensation for financial losses, but also for lost profits and the payment of interest resulting from the time elapsed since the damage occurred.

EE&MC examines all aspects of potential damages with economic expertise. Proven techniques for estimating damages include regression analyses (e.g. in the context of comparative market analysis over time) and econometric modelling of markets (market simulation models). Such economic analyses usually also enable proof of a direct causal link between the cartel violation and the damage incurred.

EE&MC has extensive experience in the application of estimation methods and techniques, which are described, among others, by the European Commission in its 2013 guidelines on the quantification of damages. EE&MC also has the knowledge to successfully apply the now extensive case law of the courts. This point is essential: only economic analyses within the legal framework can contribute to the court's findings.   

Over the years, EE&MC has estimated damages for both victims and cartel participants in almost twenty different cartel constellations. The combination of solid practical knowledge and scientific underpinnings enables us to carry out precise and comprehensible estimates.