Can a claim for antitrust damages be served on a non-defendant subsidiary?

On January 11, 2024, the European Union’s Advocate General, Maciej Szpunar, filed his non-binding opinion in Case C-632/22, pending before the Court of Justice of the European Union (CJEU) as a result of a request for a preliminary ruling by the Spanish Supreme Court in the context of the trucks litigation.

Background

On July 12, 2018, Transsaqui filed a lawsuit against AB Volvo before Commercial Court No. 1 of Valencia. For the purposes of serving the claim, Transsaqui indicated the domicile of AB Volvo's Spanish subsidiary, Volvo Group España S.A.U., located in Madrid. However, the registered office of AB Volvo (the parent company) was located in Sweden.

AB Volvo was served the claim at the domicile of Volvo Group España, which refused to accept service, stating that its parent company’s domicile was in Sweden. Transsaqui objected to this conduct, declaring that Volvo was acting in bad faith to delay the process.

The commercial court considered that it had correctly served the claim based on the principle of economic unity of the company, and it therefore declared AB Volvo in default and continued with the proceedings. On February 26, 2020, the court issued a judgment upholding the claim and ordered AB Volvo to pay the compensation requested by Transsaqui. Another attempt was made to serve the judgment at the subsidiary's domicile and Volvo Group España refused the notification. The judgment became final and subsequently Transsaqui requested its enforcement, which the court granted.

In light of what happened, on June 15, 2021, AB Volvo filed an application with the Supreme Court for review of the default judgment.

The Supreme Court admitted the application for review and agreed to submit the following request to the CJEU for a preliminary ruling:

“1.- In the circumstances surrounding the litigation relating to the trucks cartel, described in this order, is it possible to interpret Article 47 of the Charter of Fundamental Rights of the European Union, in conjunction with Article 101 of the Treaty on the Functioning of the European Union, in such a way that service of process on a parent company against which an action for damages for the harm caused by a restrictive trade practice has been brought is considered to have been properly effected when such service was effected (or attempted) at the place of business of the subsidiary company established in the State in which the legal proceedings were brought, while the parent company, which is established in another Member State, has not entered an appearance in the proceedings and has remained in default?

2.- If the previous question is answered in the affirmative, is that interpretation of Article 47 of the Charter compatible with Article 53 of the Charter, in light of the case law of the Tribunal Constitucional de España (Spanish Constitutional Court) on the service of process on parent companies established in another Member State in disputes relating to the trucks cartel?”

Advocate General’s position

In his opinion, the Advocate General begins by pointing out that the subject matter of the question referred for a preliminary ruling pertains to a matter regulated by European Union law as part of the regulatory framework on the coordination of civil proceedings between Member States and judicial cooperation.

He refers to the fact that service of the judicial documents in question must be done according to Regulation 1393/2007 of November 13, 2007, on service in Member States of judicial and extrajudicial documents in civil or commercial matters and repealing Council Regulation (EC) 1348/2000. He states that "the principle that a person sued in civil proceedings is entitled to be served personally with the document instituting the proceedings in sufficient time to arrange for his or her defense is a fundamental element of the right to a fair trial," which is reflected in other provisions of EU law such as Article 28 of Regulation 1215/2012 of December 12, 2012, on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters, or Article 19 of Regulation 1393/2007. Therefore, the referring court must stay the proceedings until it is established that the document was served on the defendant according to Regulation 1393/2007 (paragraphs 39 and 40).

In the Advocate General’s opinion, this determines that (i) "a parent company established in another Member State (Sweden) is entitled not to enter an appearance where the document instituting the proceedings was served at the domicile of its subsidiary established in another Member State (Spain) and (ii) "In a similar vein, a subsidiary (located in Spain) cannot be required to accept service of a document instituting proceedings addressed to its parent company established in another Member State (Sweden)" (paragraph 41), which contradicts the position adopted by the court that had dealt with the proceedings.

For the Advocate General, the judgment in Sumal (Case C-882/19), according to which an action for damages may be brought against a subsidiary that is not the addressee of the decision imposing the penalty, provided it is established that that company and its parent company constituted an economic unit at the time of the infringement, does not alter the above, since that judgment does not refer to the issue of the service. It points out that "the court’s reasoning in Sumal is focused exclusively on considerations of substantive law." However, regarding service of the claim, he states that "any ambiguity should be avoided," as this is a fundamental element of the right of defense in civil proceedings. The Advocate General considers that "attenuating the provisions of Regulation 1393/2007 by allowing service of a document on another (legal) person (in this case, a subsidiary) could ultimately amount to a lack of mutual trust in judicial cooperation" and that "adding to the provisions of that regulation a combined reading of Article 101 TFEU and Article 47 of the Charter would not serve judicial cooperation, but constitute a small but significant step to de facto eradicating it" (paragraphs 51-53).

The Advocate General does not seem to attribute relevance to the plaintiff’s allegations regarding the alleged excessive cost of serving the claim in Sweden, which he considers a hypothetical issue. He points out that Directive 2014/104, on Damages, does not alter the above either, as it is an area regulated by European Union law in which there is no room for procedural autonomy or for the principles of effectiveness and equivalence (paragraph 58).

The Advocate General's opinions are available at the following link: (English).