The CJEU drew a clear distinction between EU principles on the private enforcement of EU competition law and EU principles on private international law. In these two cases, the legal certainty served by private international law instruments on jurisdiction and service prevailed over private enforcement goals such as deterrence and full compensation. For the predictability of valid service of process and of the courts' jurisdiction, it is pivotal which legal entities are served and/or sued. This outweighs further facilitation of claimants, so the 'single economic unit' concept that is used in competition law to consider various entities within a group as one and the same 'undertaking' to which the EU competition rules apply was not extended to jurisdiction and service in these cases.

According to CJEU case law on infringements of Article 101 Treaty on the Functioning of the European Union (TFEU), a legal entity which has not directly participated in an infringement of Article 101 TFEU and is not an addressee of the relevant European Commission (EC) decision, can still be held liable. The CJEU requires this legal entity form part of a single economic unit with the infringing entity determined in that decision (Sumal, C-882/19). In its recent two decisions MOL v Mercedes-Benz Group, C-425/22 and Volvo v Transsaqui, C-632/22, the CJEU rejected the application of the 'single economic unit' concept for the purposes of determining jurisdiction under Article 7(2) Brussels I Recast Regulation (Regulation (EU) 1215/2012) and for the purposes of service of documents under the Service Regulation (Regulation (EC) 1393/2003), respectively. Both decisions concern follow-on proceedings based on the EC Settlement Decision in Trucks, in which both Mercedes-Benz Group and AB Volvo had been addressed (EC Decision C(2016) 4673 final).

MOL v Mercedes-Benz Group (C-425/22)

If only a parent company's subsidiaries suffer harm from an infringement, the parent company cannot invoke its own registered office as the place of the harmful event as ground for jurisdiction

MOL is a parent company based in Hungary with several subsidiaries in different Member States. These subsidiaries directly purchased or leased trucks from Mercedes-Benz Group during the period of the infringement. MOL initiated proceedings against Mercedes-Benz Group in a Hungarian court based on damage allegedly suffered due to overpayment by its subsidiaries. MOL relied on the 'single economic unit' concept as developed in CJEU case law on EU competition law. According to MOL, Hungarian courts had jurisdiction, because its registered office as a centre of the MOL group's economic and financial interests is the place where the damage occurred. The place where the damage occurred is a ground for jurisdiction (Article 7(2) Brussels I Recast Regulation).

The CJEU did not agree with MOL. Where the market affected by the anticompetitive conduct is in the Member State on whose territory the alleged damage is purported to have occurred, that Member State must be regarded as the place where the damage occurred. Damage as an indirect consequence of the harm initially suffered by somebody else at a place different from where the indirect harm was suffered cannot establish jurisdiction. The CJEU underscored that in the case at hand only the subsidiaries directly suffered damage. MOL as such did not purchase any trucks from Mercedes-Benz Group.

The CJEU also rejected the reverse application of the 'single economic unit' concept as argued by MOL: this concept only applies to the defendant's group in their capacity as the addressee of EU competition law, not to the claimants' group. The courts in Member States in which the market was affected by the infringement are best placed to assess actions for damages. The CJEU also underscored that the inapplicability of the 'single economic unit' concept for the purposes of ascertaining jurisdiction does not prevent the parties allegedly injured by anticompetitive conduct from asserting their right to compensation. They are always entitled to bring proceedings in the place where the perpetrator of the infringement is domiciled. According to the CJEU, the objectives of proximity and predictability of rules on jurisdiction and the consistency between the forum and the applicable law, as well as the existing unhindered possibility of claiming damages for the harm arising from an infringement of EU competition law affecting a member of the single economic unit, preclude a reverse application of the 'single economic unit' concept.

Based on the above considerations, the CJEU ruled that the place where the harmful event occurred, i.e. the place of the damage in this situation, does not cover the registered office of a parent company bringing an action for damages for harm suffered by its subsidiaries as a consequence of an infringement of EU competition law, even if the parent company and its subsidiaries form part of the same economic unit.

Volvo v Transsaqui (C-632/22)

A judicial document addressing the parent company cannot be served on the address of the subsidiary, even if they form a single economic unit

Transsaqui brought an action for damages in Spain against Swedish defendant AB Volvo, seeking compensation for cartel damages it allegedly suffered with the purchase of two Volvo trucks. Transsaqui had the summons to appear served at the registered office of Volvo España, which is AB Volvo's subsidiary in Madrid (Spain). It had not sought to serve the summons on AB Volvo in Sweden. The copy of the application was received at the address of Volvo España. It was refused by Volvo España. The Spanish court subsequently issued a decision in which it agreed that, based on the EU competition law principle of the 'single economic unit', AB Volvo could be validly served with a summons to appear at the domicile of its subsidiary in Spain. The Spanish court subsequently rendered a decision in the undefended case and ordered AB Volvo to pay the claimed compensation. However, the Spanish Supreme Court referred the case to the CJEU. Briefly summarised, the CJEU had to answer the question whether documents addressed to a parent company can be served on a local subsidiary, in light of the 'single economic unit' concept and in order to minimise the costs of private enforcement for claimants.

The CJEU's clear answer was no. It held that, even if a subsidiary and the parent company form a single economic unit within the meaning of the CJEU's Sumal judgment, that does not imply that the subsidiary is expressly authorised or designated by the parent company as a person empowered to receive judicial documents on its behalf. The CJEU underscored the necessary guarantee of actual and effective receipt of documents by their service on the defendant. This requirement safeguards the right to effective judicial protection enshrined in Article 47 of the EU Charter. In that respect, the party allegedly harmed by an infringement involving a single economic unit cannot rely on the existence of such a unit when serving judicial documents intended for the parent company at the address of its subsidiary in another Member State. The CJEU emphasised that a party allegedly harmed by an infringement involving a single economic unit can bring an action for damages either against the parent company or against a subsidiary of that company in the Member State where that party and that subsidiary reside. This enables the alleged injured party to avoid having to bear any costs of translation or service of judicial documents in another Member State. In other words, the CJEU in essence considered that the added value for the claimant of being able to serve documents on an entity other than the one addressed is very low, while a fair hearing requires that judicial documents intended for a person are actually and effectively delivered to that person.