Backhouse Jones, in conjunction with Addleshaw Goddard, have lodged a ground-breaking legal action with the Competition Appeal Tribunal (CAT) on behalf of the Road Haulage Association (RHA). The application, lodged on 17 July 2018, signals the start of a claim against European truck manufacturers for compensation in excess of £1 billion for thousands of road haulage operators who have suffered loss as a result of the illegal cartel activities.
Road haulage operators who would like to join the claim (see “Who is eligible to join the claim”) can do so by visiting www.truckcartellegalaction.co.uk.
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 who 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 €2.9 billion. This is by far the largest amount ever imposed for any case of this nature. An additional fine of €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 and has also been fined €880M but denies the allegations against it and has appealed. However, this does not prevent 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. The compensation claim was lodged at the Competition Appeal Tribunal on 17 July 2018. For a summary of the application, please see the Competition Appeal Tribunal website or click on the link below.
Operators who are eligible (see “Who is eligible to join the claim”) can still join the claim by visiting www.truckcartellegalaction.com. If the action is successful, operators will be financially compensated for vehicles sold or leased to them at inflated prices because of the cartel. In essence, the compensation will reflect the prices paid for trucks during the cartel period and the prices operators would have paid for trucks had the cartel not existed.
Early indications are that compensation could be in the region of £6,000 per truck on for every 6-tonne and above vehicle.
Who is eligible to join the claim?
Businesses that have purchased or leased new or second-hand trucks for road haulage operations (both hire and reward and own-account) new or pre-owned trucks either (a) registered in the UK or (b) registered in EEA Member States other than the UK provided the person belongs to a group of companies which also purchased or leased such trucks registered in the United Kingdom from 17 January 1997 onwards are eligible to join the claim. During the period the cartel operated, we believe around 600,000 new trucks were sold. Although this legal action is being led by the RHA, non-RHA members are able to join.
You will not be eligible to join the claim if your company belongs to a group of companies that manufacturers or if you purchased trucks for the sole purpose of re-sale or leasing to road haulage operators.
If you are unsure whether or not you are eligible to join the action, please click here and a member of the team will contact you to advise.
What is Backhouse Jones’ involvement?
Backhouse Jones are leading the action on behalf of the RHA. The team is supported by the competition and litigation team at Addleshaw Goddard together with specialist competition and litigation barristers at Exchange Chambers and Brick Court Chambers.
The action is being funded by litigation funder Therium Capital Management Limited – meaning it costs operators nothing to join the claim.
For further information please visit www.truckcartellegalaction.com or contact Steven Meyerhoff or James Lomax on 08450 30 50 30.