Cartel Effects and Component Makers’ Right to Damages

Abstract

The focus of the law on competition damages is on the recovery of overcharges appropriated by the cartels. Parties other than purchasers are often neglected, not only as a matter of judicial practice but also due to legal restrictions. We argue that a narrow concept of standing – which excludes parties that supply either the cartels or the firms that purchase from them with complementary product components – falls short of the normative objectives associated with actions for competition damages: effective deterrence of competition infringements and pursuit of corrective justice. We propose a simple economic framework with two complementary products and show that under neither competition nor cartelization do the allocation and distribution of surpluses depend on whether producers of complements purchase from a cartel or supply a cartel or its customers. This indicates that producers of complements should be treated alike, regardless of their position in the supply chain. Based on various factors that determine the enforcement effect of actions oncompetition damages and their role as an instrument to restore corrective justice, we conclude that a broad concept of standing is preferable. competition damages, pass-on, suppliers, complementary goods, causality, antitrust standing, cartel overcharge, effective deterrence, corrective justice, Directive 2014/104/EU, principle of effectiveness