Bye bye trade secrets?
In the new ARC, confidential information and trade secrets still enjoy special protection. The reason is clear: as soon as secret information is revealed, it becomes obvious and, as such, is no longer protected as confidential. The defendant that is sued for disclosure of information may therefore reply with a confidentiality objection against the request. But it does not stop short at objecting with confidentiality: the claimant may still apply for judicial review according to para 89b(6) ARC. In the course of this review – which will probably be modeled in camera similar to para 99(2) of the Rules of the Administrative Courts (“Verwaltungsgerichtsordnung”, VWGO) – the court decides, after having heard the parties, whether the information is indeed confidential. If this is the case, the court may still disclose the confidential information on a case-by-case basis and only if the interest in the disclosure of the information outweighs the interest in keeping the information secret. Whether these documents will be handed over to the claimant directly, whether the court may impose an obligation of secrecy on the lawyers vis-à-vis their clients – all of this is not explicitly spelled out in the new Act.
The 9th amendment of the ARC aims at increasing the effectiveness of private antitrust enforcement. This aim does not stop short of obtaining information. In order to strengthen the injured party’s position, the information asymmetry between the injured party and the infringer is to be remedied. Almost reflexively, the new rights to obtain information have been labeled “German Discovery” or “Discovery Light”. So what about these new rights? Are they improving the enforcement of cartel damage claims? Are they going to transfer an Anglo-American legal status into German law?
One of the primary aspects covered by the 9th reform of the German Competition Act that has just entered into effect is the transposition of the EU Cartel Damages Directive into German law. The preparatory works in the draft bill as well as the government draft thereby come to a conclusion.
Despite their long tradition and intended relevance, the rules on cartel damages claims in the Competition Act have been rather dormant for quite some time. However, in recent years, the topic gained in importance considerably. Now, the legislator stays abreast of this trend. The competition law reform significantly supplements the rules dedicated to private cartel damages claims, providing a legal basis upon which both claimants and defendants can rely upon in cartel damage proceedings. By further improving the legislative base, the reform will contribute to the reputation of Germany as a preferred venue for cartel damages litigation.