Compensation of Damages in Digital Markets

Digital markets are increasingly being dominated by large digital platforms, with the consequent problems that this poses from the point of view of the competitive functioning of the markets, both for professional users and for end users (consumers). In this digital context and in the face of the challenge of maintaining contestable and fair markets for all participants, the scrutiny of the conduct of digital platforms is decisive, especially of their most relevant behaviours from the point of view of competition law, data protection and platform sector regulation. As a result, compensation of damages in the digital context has become a hot topic in the last years. Across Europe, claims for damages are boosting, with countries such as the United Kingdom, Portugal or the Netherlands leading private enforcement of competition law and data protection in recent years, and actions for infringement of the DSA and DMA getting traction in jurisdictions such as the Netherlands, Germany and France. The transposition of the Directive on representative actions is also contributing to this trend, helping consumers to raise their voices and claim damages until now left in the pockets of the infringers.

This blog post wants to give a small overview with relevance for a broader audience of the book Compensation of Damages in Digital Markets, which compiles the papers presented at the conference IV Valencia International Meeting on Competition Law “Compensation of Damages in Digital Markets” held at the University of Valencia in November 2024. At this meeting, we had the pleasure of welcoming distinguished colleagues from several European countries who shared their views on various topics related to the theme of the event.

Following the order of the book, Juan Ignacio Ruiz Peris writes about “Keys for effective private enforcement of competition law in digital markets in the European Union”, stating that private enforcement of competition law in the E.U. is growing due to the moderation of public enforcement by the European Commission both in the application of Articles 101 and 102 TFEU and Articles 5, 6, and 7 of the Digital Markets Act, and exploring several ways to improve public and private deterrence in digital markets in relation to collective redress, the financing of claims, and public-private cooperation in the enforcement of Articles 101 and 102 TFEU and the DMA.

The chapter by Richard Whish on “The role of private litigation in the enforcement of the Digital Markets Act” considers the availability of damages to firms that suffer as a result of infringements of the DMA by ‘designated gatekeepers’ and the development of the jurisprudence of the Court of Justice on the availability of damages for infringement of the competition rules of the TFEU and the impact of the Damages Directive of 2014. It also examines the direct effect of the provisions of the DMA and the ‘pros and cons’ of litigation under competition law and/or the DMA, concluding that a quick development of private litigation under the DMA can be expected.

Niklas Brueggeman’s contribution entitled “Fundamental principles of private DMA enforcement” argues that the obligations laid down in Article 5, 6 and 7 DMA as well as in Article 13 DMA can have direct effect between private individuals and can therefore create rights and obligations between private individuals that can in turn be enforced before national courts by way of private enforcement actions. It also considers that the legal framework for private DMA enforcement is essentially rooted in the principles established by the CJEU, notably the principles of effectiveness and equivalence of EU law, and that one can take inspiration from the line of case law that has further fleshed out these principles in the context of private antitrust enforcement.

Jens-Uwe Franck’s chapter on “Damages actions against digital gatekeepers for breaches of EU antitrust law and the DMA: A German perspective” provides insights into private antitrust litigation against digital gatekeepers before German courts, presenting how, while the pending damages actions are still at an early stage, a number of injunction actions have been decided, providing some insight into the effectiveness of private antitrust enforcement against digital gatekeepers. It also discusses the role of damages actions as an instrument of corrective justice and of enforcement in the context of DMA infringements and the conceptual choice to include DMA infringements in the German antitrust damages law in the light of the EU principles of effectiveness and equivalence.

Jiří Kindl writes about “Damages actions in the digital sector - Czech experiences with the EU level impact” where he examines the evolving landscape of private competition litigation in the Czech Republic, with a particular focus on damages actions in the digital sector and their broader implications for the EU. The paper considers how, despite the limited prevalence of private enforcement in Czechia, some notable cases show a potential for EU-level impact, focusing in particular into the Heureka case, where a preliminary reference to the CJEU clarified previously unaddressed issues surrounding limitation periods, reinforcing the principle of effectiveness in EU competition law. It concludes by assessing the potential future trajectory of these cases and their broader significance for private damages claims within the EU.

The joint contribution by Marco Botta and Niccolò Galli entitled “Big tech and private antitrust litigation in Italy” examines private enforcement in Italy, where the competition authority (ICA) has been an active public enforcer, but private litigation against Big Tech remains limited. The analysis focuses on three cases before the Milan Court, which illustrate both the potential and challenges of private enforcement, arguing that, although private actions did not yield the desired remedies for the three small plaintiffs, the Italian cases provide valuable insights for future private litigation, not only under Article 102 TFEU but also in the context of the emerging EU digital regulations.

Carmen Herrero Suárez writes about “The problem of access to justice in digital markets: collective redress solutions”, analysing two solutions that are acquiring much strength to deal with the limitations of the individual actions in certain scenarios: one of a procedural nature, the collective or representative action, and another of a substantive nature, by means of contractual instruments, the assignment of credits or claims to a litigation vehicle. Her paper examines these two solutions, assessing their admissibility and implementation in practice in the European framework and the role they are playing or may play in the future to solve the problems of access to justice for victims of anti-competitive practices or other illegalities in digital markets.

Eugenio Olmedo Peralta addresses “Private enforcement and compensation for the damages caused by app stores in violation of the DMA”, examining the competitive constraints inherent in the current configuration of digital mobile ecosystems, with a focus on practices that restrict developers from directly distributing their applications, and highlighting the limitations of traditional antitrust tools in addressing structural and behavioural barriers within these markets. The paper also analyses the conduct of Apple and Alphabet in the context of the DMA and argues that both firms continue to engage in strategic behaviours central to the entrenchment of their market power. It considers that the development of efficient private enforcement pathways is essential to ensure compliance and to enable effective redress for affected market participants.

Carlos Gómez Asensio’s chapter entitled “Unlawful State aids to startups in digital and technological markets”, addresses how startups in digital and technological markets are postulated as potential recipients of various categories state aids within the framework of the multiple aids granted in implementation of the Spanish Recovery Plan. His paper carries out an analysis of the lawful and compatible nature of such State aids with the internal market from the point of view of Competition Law.

Julia Suderow’s contribution on “Private antitrust enforcement for consumers and digital platforms. Where is the compensation?” examines the evolving landscape of private enforcement in abuse of dominance cases within digital markets and how the rise of Big Tech has intensified bargaining asymmetries and introduced new competition risks, prompting regulatory responses such as the DSA and the DMA. Through an initial analysis of two cases, the article highlights the procedural and evidentiary hurdles in quantifying harm, particularly for consumers, discusses the limitations of current legal and economic methodologies, and argues that, despite a consensus on the need for effective private enforcement, significant barriers remain due to the fragmentation of collective redress mechanisms and the complexity of proving harm in digital markets.

The final chapter “The application of the Directive 2020/1828 on representative actions in the context of the DMA”, by María Gómez Santos, explores the connections and applications of this Directive within the context of the DMA. The paper concludes that SMEs fall outside the scope of the Directive and are therefore unable to pursue representative actions for potential violations of the DMA, the alternative options (individual litigation or combination of their actions) carrying certain disadvantages. It also addresses the potential issues that may arise from using third-party funds to finance representative actions and reviews the status of the transposition of Directive 2020/1828 into the Spanish legal system and identifies some areas for improvement.