The quantification of damages for a breach of Article 101 or 102 TFEU is complex, demanding and time consuming. Over the last few years, it has become one of the main issues in policy discussions within the European Union (EU). In particular, the European Commission (EC) investigated and revealed that the procedure for the quantification of
damages caused by a breach of EU antitrust laws not only requires expert economic and econometric skills, but varies from Member State to Member State. As a consequence of
this disparity, the EC issued new guidelines to render uniform the procedure for the quantification of damages caused by antitrust breaches across Member States and adopted new regulations to encourage private actions for damages. The latter aim at encouraging the use of alternative dispute resolution (ADR) methods, most notably arbitration, to resolve antitrust disputes as they provide a more expedient process and a fairer solution than a national court judgment. Furthermore, arbitration may be compared to a noncooperative or Bayesian game. Indeed, an antitrust dispute is characterised by asymmetric information. Hence, the parties thereto act strategically in order to push the arbitrator to issue a settlement in their favour. As a result, both parties are incentivized to make extreme
offers, the effect of which is to slow down the arbitration proceedings and lead the arbitrator to reach a settlement which does not correctly quantify the damages suffered.
Thus, we require a system that has the double effect of encouraging the parties to avoid adopting extreme positions and converge in their offers. The amended final offer
arbitration (AFOA) seems to comply with both these equirements. Nevertheless, the fact that it involves a punishment could prove counter-productive by discouraging the parties from actually selecting arbitration as an ADR method to resolve their disputes. Thus, to be an effective private action for damages caused by an infringement of Article 101 or 102 TFEU, arbitration must be structured in a manner that enables the arbitrator to reach a fair
settlement, encourages the parties to converge in their offers and incentivises the parties to actually select such arbitration mechanism to resolve their disputes.The quantification of damages for a breach of Article 101 or 102 TFEU is complex, demanding and time consuming. Over the last few years, it has become one of the main issues in policy discussions within the European Union (EU). In particular, the European Commission (EC) investigated and revealed that the procedure for the quantification of
damages caused by a breach of EU antitrust laws not only requires expert economic and econometric skills, but varies from Member State to Member State. As a consequence of
this disparity, the EC issued new guidelines to render uniform the procedure for the quantification of damages caused by antitrust breaches across Member States and adopted new regulations to encourage private actions for damages. The latter aim at encouraging the use of alternative dispute resolution (ADR) methods, most notably arbitration, to resolve antitrust disputes as they provide a more expedient process and a fairer solution than a national court judgment. Furthermore, arbitration may be compared to a noncooperative or Bayesian game. Indeed, an antitrust dispute is characterised by asymmetric information. Hence, the parties thereto act strategically in order to push the arbitrator to issue a settlement in their favour. As a result, both parties are incentivized to make extreme
offers, the effect of which is to slow down the arbitration proceedings and lead the arbitrator to reach a settlement which does not correctly quantify the damages suffered.
Thus, we require a system that has the double effect of encouraging the parties to avoid adopting extreme positions and converge in their offers. The amended final offer
arbitration (AFOA) seems to comply with both these equirements. Nevertheless, the fact that it involves a punishment could prove counter-productive by discouraging the parties from actually selecting arbitration as an ADR method to resolve their disputes. Thus, to be an effective private action for damages caused by an infringement of Article 101 or 102 TFEU, arbitration must be structured in a manner that enables the arbitrator to reach a fair
settlement, encourages the parties to converge in their offers and incentivises the parties to actually select such arbitration mechanism to resolve their disputes.LUISS PhD Thesi
