Low risks, high profits – These are still two key characteristics cartelists can count on. Based out of Bonn, Germany, litigation funder FORIS AG and law firm Becker Büttner Held (BBH), specializing in antitrust and energy law, are determined to change this situation by launching a Europe-wide cartel damages cooperation (www.cartelx.eu). "The aim is to increase cartelists’ risk for anti-competitive business practices, to improve the chances of companies and public organisations to successfully claim cartel damages, and to deter new cartels more efficiently", explains FORIS’ Chief Executive Hanns-Ferdinand Müller.

 

 

Bonn | Berlin, December 12, 2019 – Cartels have an expensive impact on companies and organisations when they are directly targeted by cartelists. But there is more to the situation: The entire economic eco-system of a country or region suffers from those secret arrangements cartelists have made. Cartels reduce the pressure of competition and innovation. Cartel members can afford to become second-tier manufacturers – because their cartelist competitors will no longer strive to offer better products or services. As a result, there will be reduced corporate investments in research and development; product updates and technological advancements will be delayed while retaining expensive and inefficient solutions. "Just like monopolies, cartels have a toxic effect on economies", says Hanns-Ferdinand Müller, CEO of FORIS AG, the pioneer of litigation funding in Germany.

 

FORIS AG has decided to partner with Becker Büttner Held (BBH), a law firm specialising, among other fields, in cartel damages litigation. Around 20 further European law firms have joined the initiative since its inception to launch a Europe-wide "cartel radar". "Under the brand name 'FORIS CARTEL X' we have started a cartel damages cooperation which does not only seek to identify potential new cartels at an early stage but equally to inform likely targets, provide them with pragmatic advice and put them in a better position to defend themselves without the usual cost risks", says Christian Held, Partner at BBH. "Often times, companies that have become victims of anti-competitive business practices will neither know, nor learn for a long time, that they have indeed been hit by a cartel. It is quite typical for these cases that the amounts of damages are enormous", continues Held.

 

A core element of the cooperation is the newly founded 'ECDA' (European Cartel Damage Alliance e.V.), which steers the activities of the European law firm network in the form of an association registered in Germany. The ECDA member law firms stand ready to advise clients and interested parties throughout Europe. Their proposition namely includes bundling claimant groups for more efficiency and more impact against cartelists (www.ecda-online.com).

 

David vs. Goliath – at corporate level

Even when corporates learn they have become victims of a cartel, they often remain reluctant to claim for damages. There are many reasons for this effect: Litigation comes with high costs for lawyers and quantum experts who are needed to substantiate the amount of damages in the particular case; further, a general concern to jeopardise essential business relationships can be observed. "We commonly see relatively small units on the side of corporate victims while the cartel itself comprises three or four large or even dominating players in the market", says Müller. Uneven playing fields are prevalent and suit the perpetrators more than the victims.

 

Incentivised cartels: low risks - high profit outlooks

For a long time the risk of companies to be actively involved in cartels was quite manageable. "In a worst case, a fine was imposed and limited plaintiff action was brought to seek damages. In most cases, the additional income generated over the entire duration of a cartel was significantly higher than what would be payable if you were caught", says Held. Accordingly, illegal cartel activities are widespread as some recent examples show: The beer cartel, the sugar cartel or the truck cartel.

 

""The aim of our cartel damages cooperation is to improve the chances of companies and organisations to successfully claim the damages they are entitled to", explains Müller. The range of services offered by the cooperation is broad:

FORIS CARTEL X, in cooperation with BBH and the member law firms of the European Cartel Damage Alliance e.V. (ECDA):

 

  • Identifies cartel damages cases at an early stage and raises awareness among target victims groups
  • Provides orientation on options, opportunities and risks of pursuing relevant claims.
  • Analyses the amount of damages caused by a cartel.
  • Increases legal defence readiness levels and reduces cost risks. • Adds pressure on the cartel members by bundling claims.
  • Serves as a professional dispute resolution provider and thus enables not only the enforcement of claims before and out of court but at the same time generally reduces the risks for existing business relationships.
  • Creates an even playing field through highly specialised lawyers.

 

press contact:

FORIS AG
Conny Leuschner
Kurt-Schumacher-Straße 18-20
53113 Bonn

Tel.: +49 228 95750-21
E-Mail: presse@remove-this.foris.com

 

Becker Büttner Held
Prof. Dr. Ines Zenke
Magazinstr. 15 - 16
10179 Berlin
Tel.: +49 30 6112840-179
E-Mail: presse@foris.com

 

newskontor GmbH
Graf-Adolf-Straße 20
40212 Düsseldorf
Tel.: +49 211 863949-0
E-Mail: foris@remove-this.newskontor.de

 

 

About FORIS AG

FORIS AG is seen as the pioneer in litigation funding. Since 1996, when litigation funding was not an established risk management tool but new to the legal market, FORIS AG has been funding the cost of legal court disputes and arbitration in return for contingent success fees. Over the years, FORIS AG has funded claims in excess of EUR 810 million and has served its clients to resolve their legal disputes more efficiently and with reduced risks. Corporate clients can also choose to monetise their claims ahead of court proceedings. Through FORIS’ Cash Advance Solution, clients can procure additional liquidity in suitable cases. FORIS AG further offers its clients and partners SPV shelf companies. These companies will add fast and reliable handling options in venture projects and corporate transactions. Part of FORIS Group is also GO AHEAD, a highly capable partner and German market leader when it comes to establishing foreign-registered Limited companies and to providing relevant corporate governance support. GO AHEAD has expanded its portfolio by adding GO AHEAD Academy in 2018, an online portal to support entrepreneurs with valuable know-how and assistance to start their own ventures (www.go-ahead.de).

Find more at: www.foris.com

 

 

About BBH

 

Becker Büttner Held is a leading law firm in Germany and a leading provider of advisory services for energy and infrastructure companies and their customers. Energy and supply companies, particularly public utilities, municipalities and local authorities, industrial companies and inter-national groups are among its core clients. BBH advises these and many other com-panies and organisations in all legal matters and also assists them with business and strategic advice.

Find more at: https://www.beckerbuettnerheld.de/en/

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Your contact person
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Maren Thaysen Assistant to the Board