§4.1 Data and information needed when quantifying the passing-on effects

(74) As explained in section 2.2, the Damages Directive includes rules governing the disclosure of evidence. Data and information in the hands of the parties or third parties are important factors in order to carry out a sound economic analysis of the passing-on effects. Hence, a useful first step when quantifying the passing-on related price effect may be to identify the need for and the availability of data for building the counterfactual. (75) When deciding which type of data and information is relevant in a specific case, it may be helpful for the judge to take into account the general insights from economic theory explained in section 3. These insights may also be relevant if the judge needs to assess conflicting views of economic experts (67). Furthermore, the type of data needed for estimating the passing-on will usually require good knowledge of the industry in question and the prevailing market characteristics in the case at hand. Therefore, it may be useful to initially consider documents which indicate the plausibility of passing-on in the first place, such as existing court decisions, parallel civil proceedings at the same or a different level of the supply chain in the same market, market studies or decisions from competition authorities describing the relevant market dynamics (68). (76) The court may have to consider evidence of both qualitative and quantitative nature (69). Qualitative evidence, such as internal documents on pricing, strategy, contracts and financial reporting, may be analysed in the context of economic theory. They may also give information on whether there is evidence of a link between the downstream pricing and the upstream overcharge that results from the infringement. (77) However, in order to construct a counterfactual and control for different factors affecting passing-on, quantitative evidence may also be useful in many cases. Such evidence may include data on actual prices, costs or margins as well as external indicators which would influence pricing decisions of firms, e.g. aggregated measures of economic activity (such as GDP growth, inflation and employment rates). In some cases, regional variables of economic activity might be useful to control for different regional tendencies which are not related to the infringement. (78) The court may also take into account more industry or firm-specific factors influencing the price formation. For instance, in the example in Box 1 above, if plastic had also been an essential input for the production of wire harness during the infringement period when copper manufacturer A had agreed with its competitors to fix prices for copper as the other essential input for the wire harness supplier B, it is likely that B would have passed on to its customer also an increase in prices for plastic which was not subject to an infringement of EU competition law. In this case, an estimation of passing-on which fails to take into account the effects related to the increase in prices for plastic could materially overestimate the passing-on of the overcharge by wrongly attributing the entire price increase to the infringement. Similar reasoning applies to potential decreases in other input costs which, if not accounted for and passed on down the supply chain, would artificially decrease the estimated passing-on of the cartel overcharge. (79) In the examples that follow, the application of the methods focuses on the price. Depending on the availability of data and the circumstances of a given case, the court may also consider the same methods to estimate other economic variables, such as profit margins or the level of costs of an undertaking. The data used to compare the affected market with the counterfactual may relate to the entire market (e.g. the average of the price of wire harnesses for all customers in other product markets or geographic markets) or to certain customers or customer groups.

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Source: EUR-Lex (Cellar) · retrieved 2026-09-07