Further narrowing of the Air Cargo claims

By Jane Goodacre, Jonathan Speed, Peter Willis


The Defendant Airlines in the highly publicised "Air Cargo" proceedings have, again, succeeded in narrowing the scope of the (hundreds) of Claimants' claims for damages incurred as a result of alleged anti-competitive agreements forged between various air cargo carriers.

The Claimants' case received a major blow in 2015 when the Court of Appeal ruled that the Claimants' claims based on the torts of unlawful means conspiracy and unlawful interference with the Claimants' business were to be struck out [read more on this here]. The result of this decision was the loss to the Claimants of around 60% of their claims. The Airlines did not stop there and had another trick up their sleeves.

In July this year the parties to the Air Cargo litigation were in court again for the hearing of a preliminary issue application to determine the temporal scope of the Claimants' right to damages under what is now Article 101 of the Treaty of the Functioning of the European Union ("TFEU"). The Claimants' claim is for losses which date from 2001 onwards. The Airlines contended that, as a matter of law, there can be no claim for damages arising from the cartel insofar as it affected freight charges between the EU and third counties before 1 May 2004; that being the date on which air transport between the EU and third countries was brought within the regime implementing the EU competition rules set out in Regulation 1/2003. The Airlines further argued that there was no legal justification for the Claimants to rely on the transitional implementing provisions set out in the Treaty itself (which were in place prior to 1 May 2004) as that would amount to a retrospective change to the substantive law.

The Claimants' arguments that the national courts had jurisdiction to rule on infringement of what are now Articles 101 and 102 throughout the transitional period, that the Treaty had direct effect, and that in any event the relevant provisions of Regulation 1/2003 are procedural and can be applied retrospectively were, following an in-depth analysis of the temporal scope of Regulation 1/2003 and TFEU, rejected by the court. The conclusion being that Article 101 TFEU does not allow for damages claims to be brought in relation to air transport routes between the EU and third countries prior to 1 May 2004.

The Airlines' efforts to narrow the Claimants' claims have had the effect of clarifying and consolidating areas of law which were previously nuanced in respect of their application to competition claims, this in turn will help to streamline similar claims brought in the future.