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Belgian Private Damages Claims for Anti-Competitive Behaviour: Constitutional Court decides on Starting Point of Limitation Period

11 March 2016

On 10 March 2016, the Belgian Constitutional Court handed down an important decision on the starting point of the limitation period for private enforcement actions. These actions cannot be time-barred before a final decision establishing the competition law infringement is reached.  

On 10 March 2016, the Belgian Constitutional Court handed down an important decision on the starting point of the limitation period for private enforcement actions. These actions are civil law claims (private damages claims) aimed at compensating victims for harm caused by infringements of competition law (for example, participation in a price cartel).

Private damages claims in Belgium are generally based on tort rules. An infringement of competition law may be classified as an ‘extra-contractual wrongdoing’. If it causes damage, for example in the form of overcharges in a price cartel, a victim may claim compensation. The victim will then have to prove a causal link between the wrongdoing and the damage suffered.

Under a general rule in the Belgian civil code, claims based on tort must be initiated within five years from the moment the victim discovers the damage and has knowledge of the identity of the person liable.  Knowledge of any damage suffices.  It is not relevant that the full extent of the damage is not known.

This general rule created uncertainty as to the starting point of the five-year period where the competition authorities are currently pursuing an investigation or proceedings against the infringer and a victim believes that the behaviour being investigated constitutes an infringement of competition law and has caused damage to them. Does the limitation period start to run here because the identity of the alleged infringer is potentially known, even though there is no final decision as to whether the infringer is liable?

Because the on-going investigation or proceedings do not suspend or interrupt the limitation period in a damages claim, this uncertainty obliged a prudent victim to file a damages claim before a final decision establishing the infringement of competition law was reached.

In the case before the Constitutional Court, it was claimed that if the general rule in the Belgian civil code was to be interpreted in a way that the limitation period (of five years) could expire prior to the establishment of the infringement of competition law in a final decision, it conflicted with the Belgian Constitution.

The Constitutional Court agreed, and held that such an interpretation would make it more difficult for a victim to exercise their right to be compensated. It referred to the importance of the investigation by or proceedings before the competition authorities, and in particular the procedural tools available to the competition authorities to obtain evidence for victims to be able to effectively rely on a competition law infringement in order to claim damages. The Constitutional Court ruled that the general rule in the Belgian civil code on limitation periods would conflict with articles 10 and 11 of the Belgian Constitution if it was interpreted in a way that a private damages action could be time-barred before a final decision establishing the competition law infringement was reached.

The Constitutional Court also referred to the European Directive 2014/104/EU (the European Directive) which aims at making it easier for victims to obtain compensation for harm suffered as a result of anti-competitive behaviour. According to the European Directive, Member States must ensure that any natural or legal person who has suffered harm caused by an infringement of competition law is able to claim and to obtain full compensation for that harm.

Article 10 of the European Directive deals specifically with limitation periods and prescribes that a limitation period (i) is at least five years and (ii) shall not begin to run before the infringement of competition law has ceased and the victim knows, or can reasonably be expected to know, of the behaviour and the fact that it constitutes an infringement of competition law, of the fact that the infringement of competition law caused harm to him, and the identity of the infringer. Member States must also ensure that a limitation period is suspended or interrupted during an investigation by a competition authority or proceedings in respect of an infringement of competition law.

The decision of the Constitutional Court is a first step forward, but is probably insufficient to bring Belgian law rules on limitation periods into line with the European Directive.  This should occur by 27 December 2016, as by this date Member States must ensure that the laws, regulations and administrative provisions necessary to comply with the European Directive have entered into force.