Truck Cartel Claim
On 19 July 2016 the European Commission issued a press release confirming the existence of a price fixing cartel among European truck manufacturers. MAN, Volvo/Renault, Daimler, Iveco and DAF admitted to the European Commission that they had colluded for 14 years, between 1997 and 2011, to coordinate the gross list price of trucks over 6 tonnes, the timing for the introduction of emissions technologies (Euro III to Euro VI) and the passing on of costs for emissions technologies.
The European Commission handed the manufacturers an overall fine of EUR 2.9 billion. This is by far the largest amount ever imposed for any case of this nature. An additional fine of EUR 1.2 billion would have been imposed on MAN, but MAN had its fine reduced to zero as it was the immunity applicant.
Scania was also part of the investigation but has so far denied the allegations against it. The investigation against Scania will therefore continue and a decision will likely be published in due course. However, this does not in the meantime stop operators from seeking compensation in relation to the purchase of Scania trucks.
Naturally many operators have been keen to understand the impact of the cartel on their business and what action can be taken to obtain compensation. Below is a brief summary of the current position.
Has the alleged cartel impinged on your business?
Initial evidence suggests the operation of the cartel will likely have had an impact on your business, thereby entitling you to compensation. Further investigations are underway to establish the precise level of the damage to the industry. It is important to be aware that the cartel could have affected those who purchased new or second hand vehicles whether outright, through lease agreements and/or through hire purchase agreement. It is also not relevant whether the purchases were made direct from the manufacturers or through dealers. In addition, the cartel may well have had an impact on other aspects of the operating costs of haulage firms during its 14-year operation.
What action is being undertaken?
The Road Haulage Association is now giving UK haulage and logistics firms (whether or not they are RHA members) the chance to sign up to its legal action for compensation against truck manufacturers found guilty of illegal price fixing. In July last year the European Commission fined MAN, Volvo Group (which includes Volvo Trucks and Renault Truck), Mercedes-Benz parent company Daimler, Iveco and DAF close to €3 billion (£2.6 billion) for price fixing and other cartel activities between 1997 and 2011. The compensation claim will be brought before the Competition Appeal Tribunal. If successful, haulage and logistics companies will get money back for vehicles sold or leased to them at inflated prices because of the cartel, if they sign up to the claim.
This is the first fully funded group claim against the truck manufacturers on behalf of affected hauliers. All UK truck owners can join the group legal action at www.truckcartellegalaction.com. There will be no cost for hauliers to be part of the group claim.
Early indications are that compensation could be in the region of £6,000 per truck on average across different truck sizes. Companies that have purchased or leased new or second-hand trucks direct from manufacturers (including Scania) or dealers from 1997 onwards are eligible to join the claim. During the period the cartel operated we believe around 650,000 new trucks were sold. Although this legal action is being spearheaded by the RHA, non-RHA members are able to join.
What is Backhouse Jones’ involvement?
Backhouse Jones, solicitors, and barristers from Exchange Chambers and Brick Court Chambers will lead the claim. The group legal action is being funded by litigation funder Therium Capital Management Limited, who will cover the costs, including significant insurance cover. The RHA has therefore carefully organised the claim so as to avoid any cost or risk to hauliers joining the legal action.
For further information please contact Steven Meyerhoff or Jo Dawson-Gerrard on 01254 828300.