Private enforcement of competition law and consumer redress in Sweden

This month, professor Lars Henriksson (CELEC’s Vice Chairman) presents an overview of competition litigation in Sweden, based on his contribution to the “Comparative Private Enforcement & Consumer Redress in the EU” project.

During 2011 and 2012 professor Barry Rodger at the Strathclyde University Law School initiated as the principal investigator a comprehensive project titled Comparative Private Enforcement & Consumer Redress in the EU. The project was made possible through funding of the Arts & Humanities Research Council and concerns the application of competition law in the national courts in EU Member States with special attention private enforcement. I participated in the project in the capacity as Swedish rapporteur and the finding of the project has been published here: www.clcpecreu.co.uk

The project aims to provide a comprehensive snapshot of competition litigation in EU Member States during the period 1999–2009 and to ascertain in particular the extent to which collective redress for cases in relation to competition law infringements has been, and may be further, facilitated. This is a summary of the Swedish report.

More specifically regarding Sweden, private enforcement of competition law has become more active and significant during the last decade. The new Competition Act in Sweden marked a major change when the old principles governing competition law were abandoned in favour of full harmonisation with the EU rules. Currently, the main instrument for private enforcement is the possibility for any aggrieved party to sue for damages in relation to a competition law infringement. In addition, Sweden has also introduced the possibility of class actions, which initially raised expectations for consumer redress in e.g. competition law cases. In practice, however, the number of cases in the open courts involving damages is so far limited and there is yet to be a case involving a consumer class action for redress in relation to a competition law infringement. Some follow-on cases have been initiated, but they have all been settled out of court.

Instead of damages, another group consisting of a considerable number of cases dealt with by the special court/tribunal – the Market Court – involves subsidiary claims for injunctions. This has proven to be a quite swift and much less cumbersome way for aggrieved parties to bring infringements to an end. The major drawback with such cases is that they do not entail any compensation for the aggrieved party, although the possibility of a parallel or follow-on lawsuit for damages is not precluded. Nonetheless, there are no such cases to date.

A third group of cases are actions for nullity. Used as both a sword and a shield, litigators have come to rely upon the automatic nullity enshrined in Article 101(2) TFEU and its domestic counterpart. Particularly for contracts where only one party’s performance can be reversed, this has proven to be quite a successful use of competition law in private litigation.

There is a clear trend in Sweden for increased litigation based upon competition law, although companies appear to favour other remedies rather than damages. Moreover, the number of successful cases appears to be fairly considerable, suggesting that in practice it is possible to rely upon competition law in litigation. Some major obstacles remain, though, especially for stand-alone cases where a private party must establish not only an abuse or an agreement contrary to Article 101 TFEU, but also thereafter also causation between the abuse/restrictive practice and the antitrust injury and the proper quantification of the damage caused by the infringer. These difficulties, which may prove insurmountable in practice, may explain why other remedies have, to date, been favoured by undertakings.

– Lars Henriksson
Professor of Law, competition & antitrust law,
LL.D., M. Sc. Econ. BA SSE