The “car cartel” – Is your company affected?


Everyone is talking about the “car cartel” between VW (including its subsidiary brands Audi and Porsche), Daimler and BMW. Now that the first media outcry has died down, the time has come to address the subject with the required levelheadedness and to focus on the most important questions:


What do we actually know about the purported cartel agreements to date?

There is no reliable information on the cartel allegations to date. The media is only disclosing its insider information bit by bit from the evidently “leaked” leniency applications (referred to as “voluntary disclosure” by the media) of VW and Daimler. Agreements on exhaust gas cleaning with the additive Ad-Blue and the size of the tank required for this seem to be just one of many aspects. The allegations focus on supposed agreements in the areas vehicle development, costs, component suppliers and market strategies.

On the basis of the information currently available, official antitrust proceedings have not yet been instigated against the car manufacturers. Hence it has also not yet been “proven” that the manufacturers breached cartel law. Particularly in the technical domain, the dividing line between a legal agreement on technical standards and an illegal cartel is often blurred. That VW and Daimler seem to have filed separate leniency applications with the competition authorities independently of each other could indicate valid suspicions, however. Because of the economic importance of the automobile branch, we also cannot rule out the possibility that the competent cartel authority – the European Commission – will open official cartel proceedings against the car manufacturers.

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Could my company be affected by a possible “car cartel”?

Should the allegations of agreements on vehicle development, on the transfer of costs to consumers, as well as agreements to the detriment of car component suppliers turn out to be true, both the customers of the cars of the manufacturers concerned as well as the component suppliers would be affected by the “car cartel”.

Fleet operators, leasing companies, car rental companies, general importers or independent dealers may in this case have paid excessively high purchase prices. Component suppliers may in turn have been deprived of realisable profits through a purchasing cartel between the manufacturers. However, companies in the car financing sector may also have incurred damages as a result of the cartel, for the financing conditions are regularly also based on the car manufacturers’ selling prices.

The substantiated representation of possible damage incurred will hardly be possible without an economic expert opinion. It will not be possible to obtain such an opinion at present, however. The necessary information on the type and scope of the cartel will not be available until the conclusion of any proceedings and after publication of the authority’s decision.

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Does my company need to take any immediate action?

There is no need for immediate action as yet. It is still far too early to take legal action against the car manufacturers or to initiate settlement talks. Apart from the fact that agreements have not yet even been proven, we still have no reliable information on the type, effects and duration of the cartel. Accordingly, a serious estimate of any damages is not yet possible. A legal action to establish damages on the merits would also have no prospects of success at the moment.

However, to be on the safe side, potentially affected enterprises should already extensively back up their data now. In order to enforce a claim and calculate possible cartel damages, extensive and to the extent possible complete documentation is vital. Documents, correspondence and receipts (invoices, delivery notes, possibly also letters and e-mails) connected with the purchase of cars of the automobile manufacturers should be archived. Any automatic data-deletion processes should be suspended for these documents.

In the event the cartel authorities instigate cartel proceedings a lengthy investigation period can be expected. Depending on the complexity of the case, several years can sometimes lie between the opening of proceedings and a penalty notice. For the investigation of the claims in the “truck cartel”, for example, the European Commission took more than five years. For the majority of possible damage claims, however, enterprises need not fear the statute of limitation because the limitation period is suspended with the instigation of any investigation by the cartel authorities for the duration of such investigation.

We would be pleased to provide you with further information on the current factual and legal situation and to advise you on any strategic measures. Our team is available for an informal discussion of the issue with you at any time.

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Dr. Daniel Dohrn

Partner

Telephone: +49 221 2091 441
Telefax: +49 221 2091 333

daniel.dohrn@oppenhoff.eu

Dr. Vanessa Pickenpack

Partner

Telephone: +49 221 2091 334
Telefax: +49 221 2091 333

vanessa.pickenpack@oppenhoff.eu