In addition to the United Kingdom and Germany, the Netherlands is one of the most popular European jurisdictions for cartel damages actions. These are legal proceedings in which the claimant seeks compensation for harm suffered due to a cartel (for instance, competitors fixing prices for certain products). Such claims are usually brought after companies have been fined by the European Commission or a national competition authority for infringing the cartel prohibition. A cartel can result in higher prices, thereby causing harm to direct or indirect purchasers of the product to which the cartel relates. Depending on the nature of the cartel, multiple high-value claims can be brought by a large number of injured parties before the courts in various countries.
In some cases, injured parties have multiple countries to choose from when deciding where to initiate proceedings. The Netherlands is a popular choice for follow-on cartel damages actions, for the six reasons mentioned below.
1. Experience and quality
Dutch judges and specialised lawyers (including our own Cartel Damages Team) are experienced in dealing with cartel damages actions. For many years already, the Dutch courts have been handling multiple follow-on proceedings in connection with various infringement decisions, including in relation to air cargo, trucks, cathode ray tubes, elevators and escalators, gas insulated switchgear, high-voltage power cables, prestressing steel, paraffin wax and sodium chlorate.
As a result, the Dutch courts and lawyers are skilled in dealing with the complex legal and factual issues associated with these types of proceedings. Furthermore, the Dutch judicial system enjoys an excellent reputation, with the Dutch courts known to be competent and reliable.
A claimant may wish to bring claims against multiple addressees of an infringement decision, often located in different countries. The Dutch courts are often willing to assume jurisdiction against foreign defendants in cartel damages cases, even those that are not addressed by the infringement decision on which the claim is based. In this way, a claimant can bring claims against multiple parties before a single court.
3. Low cost exposure
Compared to certain other countries, the claimant's cost exposure is relatively low in Dutch proceedings. If the claim is rejected, the claimant may be ordered to pay the defendant's court fee and a fixed amount towards its legal expenses. For 2020, the maximum court fee for proceedings before a Dutch first instance court (rechtbank) is EUR 4,131. Save in exceptional circumstances, the defendants' legal expenses, which the claimant may be ordered to pay if it loses, are based on a court-approved scale, which provides for fixed fees for various acts. These fixed fees are usually much lower than those actually incurred. Consequently, the claimant's cost exposure in Dutch proceedings consists primarily of its own legal and other expenses.
4. Statutory interest
Dutch law allows claims for damages to be increased by compound statutory interest. The applicable statutory interest rate varies, depending on the time period concerned. In some cases, statutory interest can form a substantial part of the total amount claimed. However, the fact that the Dutch court has jurisdiction over certain claims does not automatically mean that those claims are governed by Dutch substantive law. The question as to whether a claim is governed by Dutch law must be answered on the basis of the applicable rules of private international law.
5. No need for translations
The general rule is that – unless the court decides otherwise – Dutch courts do not require exhibits in English, German or French to be translated into Dutch. This can potentially mean significant savings on translation costs, especially in cases involving substantial documentary evidence.
6. Step-by-step approach
Dutch procedural law allows for a step-by-step approach. The claimant is not obliged to claim at the outset a specific amount in damages and may first request the court to order a declaratory judgment confirming the defendants' liability for damages to be calculated in subsequent proceedings. In this way, the claimant can try to avoid entering into complex and often expensive discussions on the quantum of damages before liability has been established.
In addition, the Dutch courts are known for their flexibility and willingness to make special arrangements with the parties regarding the course of the proceedings. For example, for the sake of efficiency, the court can agree with the parties to deal first with specific issues (e.g. the law applicable to the claims or the statute of limitations) before turning to the merits of the case. This approach can also help to keep costs down.
Of course, depending on the specific claims and the infringement in question, there can be other reasons for initiating proceedings before a Dutch court (for example, based on how the Dutch courts have dealt with certain aspects of previous cartel damages claims). However, it should always be assessed on a case-by-case basis whether the Netherlands is indeed the most appropriate jurisdiction.