European Court of Justice (ECJ) decides on the extent of the self-purification in terms of procurement law, influence on trucks cartel and damages claims
Following a resolution as of 7 March 2017, the public procurement tribunal of South Bavaria ("Vergabekammer Südbayern") submitted questions relating the requirements of the self-purification in terms of procurement law to the ECJ that might as well have influence to the negotiating position of public principals affected by the truck cartel.
Content of the submission
Background of the submission is the exclusion of the switch producer Vossloh Laeis GmbH from a procurement procedure by the Munich municipal utilities ("Stadtwerke München"). The Vossloh Laeis GmbH was part of the so called rail cartel, against which the Federal Cartel Office imposed high fines. The Stadtwerke München justified the exclusion by arguing that - on the background of the self-purification in terms of procurement law - Vossloh is obliged to reveal all details regarding its participation in the rail cartel, especially concerning follow-on-damages.
The Stadtwerke München base themselves on the legal regulation of § 125 para 1 (1) Nr. 2 of the German Act against Restraints of Competition (GWB) that - with regards to self-purification - compels a cartel member to complete clearance of facts and circumstances in connection with the offence or misconduct and the damages caused by that, by actively cooperating with investigating authorities as well as the public principal. In this respect, the German implementation goes beyond the wording of the EU procurement directive that only requires the cooperation with the investigating authorities.
Potential impacts on the truck cartel
If the ECJ considers § 125 GWB to be in conformity with European law, the regulation would - with regard to the self-purification - oblige the cartel members to reveal information regarding follow-on-damages. Hereby the threat of an exclusion from future procurement procedures would be a strong device of public principals against members of the truck cartel or other cartels.
This is because once the cartel members should decide to do a self-purification, they would have to reveal all data and facts to the public principals that these need for the judicial enforcement of their follow-on-damages in civil proceedings. Therefore the threat of the exclusion from future procurement procedures is likely to raise the willingness of members of the truck cartel to reach out-of-court settlements.