EU Court of Justice issued preliminary ruling in Heureka versus Google case

The Court of Justice of the European Union (CJEU) issued a preliminary ruling in Heureka versus Google on the application of national prescription rules to actions for damages arising from an infringement of EU competition law (C-605/21).

Heureka Group a.s. (''Heureka''), a Czech company operating on the market for comparison shopping services, claims to have suffered harm as a result of Google's infringement of Article 102 of the Treaty on the Functioning of the European Union (TFEU) (the ''Infringement''), as was established by the European Commission ("Commission") in its decision in case AT.39740 - Google Search (Shopping) (the ''Decision''). In the Decision, the Commission found that Google had abused its dominant position in 13 national markets for general search services (within the EEA), by systematically positioning and displaying its own comparison shopping service (''Google Shopping'') more prominently on its general search results pages than competing comparison shopping services and lowering search entries' ranks from competing comparison shopping services in Google's search results by the use of different algorithms. This self-preferencing and demoting of rival services led to a significant decrease in website traffic from Google's general search results pages to competing comparison shopping services and, inversely, to a material increase of traffic to Google Shopping. The Commission found that, on the Czech market for general search services, the Infringement began in February 2013 and was still continuing on 27 June 2017 (i.e. the date on which the Decision was adopted).

Temporal scope of Article 10 of the Damages Directive

The first two preliminary questions concerned the temporal scope of Article 10 of the Damages Directive. In its answers to these questions, the CJEU recapitulated the main considerations laid down in the CJEU's Volvo versus RM judgment of 22 June 2022 (C-267/20), reiterating that, in order to determine the temporal scope of Article 10 of the Damages Directive, it was first necessary to ascertain whether the prescription period provided for under the old national law had lapsed before the deadline for the transposition of the Damages Directive (i.e. before 27 December 2016). For this reason, the date on which the prescription period under the old national law began to run had to be determined first. That is where the third and fourth preliminary question come into play. 

Article 102 TFEU and the principle of effectiveness preclude the application of the old Czech prescription rules

With its third and fourth preliminary question, the Czech referring court essentially asked whether the old national law, which provided for a ''prescription period of three years, which starts to run, independently and separately for each partial occurrence of harm caused by the infringement, before the end of the single and continuous infringement concerned and cannot be suspended or interrupted during the Commission's investigations'', is compatible with Article 10 of the Damages Directive, Article 102 TFEU and the principle of effectiveness. The CJEU ruled that the right to seek full compensation for the harm caused by an infringement of EU competition law would be rendered practically impossible or excessively difficult if the prescription period were to begin to run before the infringement had ceased and the injured party knew, or could reasonably be expected to know, the information necessary for bringing its damages action. 

The prescription period cannot begin to run before the infringement has ceased

According to the CJEU, the requirement that the prescription period cannot begin to run before the infringement has ceased is necessary to enable the injured party to identify and prove the existence, scope and duration of the infringement, the harm caused by it and the causal link between the harm and the infringement. In this regard, the CJEU considered relevant the complexity of quantifying the harm in competition law cases where the infringement is still ongoing, the system of public and private enforcement, which is intended to punish anticompetitive conduct and to deter undertakings from engaging in such conduct, and the deterrent effect, which may cause the undertaking involved to cease the infringement sooner. The suspension or the interruption of the prescription period for the duration of or during a Commission investigation is considered necessary to enable aggrieved parties to assess whether an infringement of EU competition law has been committed, to know the scope and duration of the infringement, and to rely on those findings in a subsequent action for damages. The CJEU ruled that Article 102 TFEU and the principle of effectiveness therefore require the suspension or the interruption of the prescription period for the duration of the Commission's investigation. 

Knowledge of information necessary for bringing a damages action

In addition, the CJEU emphasised that, for the prescription period to begin to run, the injured party must have had knowledge of the information necessary for bringing its action for damages, such as the existence of an infringement of EU competition law, the existence of harm, the causal link between that harm and the infringement, and the identity of the infringer. With reference to its Volvo versus RM judgment, the CJEU noted that the moment from which the injured party can be considered to have knowledge of this necessary information will in principle coincide with the date of the publication of the summary of the decision in the Official Journal of the European Union. The CJEU acknowledged, however, that injured parties may gain knowledge of the necessary information well before that date. The CJEU also assessed whether this might be different in the present case as, unlike in Volvo versus RM, the Decision has not yet become final, as it has been challenged by Google and is the subject of an appeal pending before the CJEU. With reference to the opinion of the Advocate General, the CJEU considered that a Commission decision that is not yet final has a binding effect as long as it has not been annulled. The CJEU clarified that, regardless of whether the decision at issue has become final, from the date of publication of the summary of the decision it may in principle be assumed that an injured party has all the information necessary to bring its action for damages: it may rely on a non-final decision to support this action. Unlike the suspension or interruption provided for in Article 10(4) of the Damages Directive, Article 102 TFEU and the principle of effectiveness do not require the national prescription period under old national law to continue to be suspended or interrupted until a Commission decision has become final. 

Conclusion in the case at hand

In the case at hand, the CJEU considered that, irrespective of when it may reasonably be expected that Heureka had all the knowledge required for bringing its action for damages, the prescription period could not have started to run before 27 June 2017, since the Infringement had not come to an end on that date. Following the CJEU's judgment in Volvo versus RM, Article 10 of the Damages Directive is therefore applicable ratione temporis. In that regard, the CJEU also refers to Article 10(4) of the Damages Directive, which stipulates that the suspension of the prescription period resulting from an action taken by a competition authority for the purpose of the investigation or its proceedings in respect of an infringement of EU competition law is to end, at the earliest, one year after the infringement decision has become final or after the proceedings are otherwise terminated.

Based on these considerations, the CJEU concluded that Article 10 of Damages Directive, Article 102 TFEU and the principle of effectiveness must be interpreted as precluding old national law, which lays down a three-year prescription period applicable to actions for damages in respect of continuing infringements of EU competition law rules and which

• starts to run, independently and separately for each partial occurrence of harm resulting from such an infringement, from the moment when the injured party knew, or could reasonably be expected to have known, of the fact that it had suffered harm and the identity of the party liable to pay compensation for that harm, without the injured party having had knowledge of the fact that the conduct concerned constituted an infringement of the EU competition rules and without that infringement having ceased; and
• cannot be suspended or interrupted during the Commission’s investigation into such an infringement.
  
  

Observations

The CJEU's judgment in Heureka versus Google largely aligns with its considerations in Volvo versus RM. Building on the latter case, Heureka versus Google clarifies several points, including the relevance of a non-final decision in determining the start of the prescription period under old national law and the apparent irrelevance of the suspension or interruption of the prescription period for the duration of a Commission investigation as provided for in the Damages Directive and national implementation acts. For this reason, it puts a spotlight on the rationale of Article 10(4) of the Damages Directive and whether the condition laid down in this provision can be seen as an actually necessary condition to be compliant with the principle of effectiveness.