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Legislation and jurisdiction
1 How would you summarise the development of private antitrust litigation in your jurisdiction?
Private antitrust litigation in Ukraine is developing slowly and the relevant practice area is still in the process of formation. A relatively large number of competition law-related cases are brought before courts each year, yet private antitrust cases constitute only a small proportion. This is because Ukrainian competition law is at a developing stage and there are no specific regulations for private antitrust litigation.
Although the legislation and court practice in this area remains scarce, the past year has shown a positive trend of a gradual growth in the number of private antitrust litigation cases with respect to different types of antitrust matters (eg, abuse of dominance, unfair competition, distortion of tender results, etc). In particular, a comparatively large private antitrust case concerning the award of damages in excess of 90 million hryvnya for distortion of the results of a tender was heard by the Commercial Court of the Kiev region, and the claim was satisfied.
As the legislative basis improves, private antitrust litigation is expected to gain significant practical importance in the near future.
2 Are private antitrust actions mandated by statute ? If not, on what basis are they possible? Is standing to bring a claim limited to those directly affected or may indirect purchasers bring claims?
Private antitrust actions are mandated by statute.
A claim can be brought by any undertaking or individual that has been affected as a result of a violation of competition law (eg, competitor, purchaser, supplier or consumer). A causative link between the competition law violation and the violation of the claimant's rights is indispensable for the claimant to succeed with the claim.
3 If based on statute, what is the relevant legislation and which are the relevant courts and tribunals?
The Ukrainian private antitrust litigation includes:
- the Civil Code of Ukraine 2003;
- the Commercial Code of Ukraine 2003;
- The Code of Administrative Proceedings of Ukraine 2005;
- the Commercial Procedural Code of Ukraine 1991;
- the Law of Ukraine on Protection of Economic Competition 2001 (the Competition Law); and
- the Law of Ukraine on Protection from Unfair Competition 1996.
Private antitrust actions are considered by Ukrainian commercial courts; the proceedings are regulated by the Commercial Procedural Code of Ukraine.
4 In what types of antitrust matters are private actions available? Is a finding of infringement by a competition authority required to initiate a private antitrust action in your jurisdiction? What is the effect of a finding of infringement by a competition authority on national courts?
Private actions are generally available in all types of antitrust matters (eg, anticompetitive concerted practices, abuse of dominance, cartel and merger cases, unfair competition, etc).
A finding of a violation by the Antimonopoly Committee of Ukraine (the AMC) is considered to be prima facie evidence as to liability enabling claimants to pursue follow-on claims for damages in court; however, such a finding is not necessary to initiate a private antitrust action or to be in place in order to have the claim granted. Moreover, since any dispute may be referred by the interested party directly to court for consideration, a violation may be found directly by the court and a finding by the AMC should not be treated as exclusive evidence of a violation. Further, the AMC may refuse jurisdiction if a competition law violation gravitates towards infringement upon a private interest rather than a public one, whereby the court would remain the sole venue for rights protection. However, in practice the AMC refrains from pursuing that approach, in particular because the authority (especially in abuse of dominance cases) has exclusive jurisdiction in defining relevant markets and establishing dominance, while the reform to change this has only just started taking shape.
5 What nexus with the jurisdiction is required to found a private action? To what extent can the parties influence in which jurisdiction a claim will be heard?
Ukrainian competition law applies extraterritorially to the extent that there is, or may be, an impact on economic competition in Ukraine (except for the cases involving unfair competition offences).
The parties cannot influence the subject-matter jurisdiction and private antitrust actions are heard by the commercial courts of Ukraine. As for territorial jurisdiction, normally a private antitrust action should be brought in the local court in the jurisdiction in which the defendant (or one of the defendants) resides or has its registered office, or where the damage occurred.
6 Can private actions be brought against both corporations and individuals, including those from other jurisdictions?
Private actions can be brought against corporations and individuals registered as individuals - entrepreneurs, including those from other jurisdictions in the circumstances described in question 5.
Private action procedure
7 May litigation be funded by third parties? Are contingency fees available?
Third-party funding of competition law claims is permitted. However, the court fees are required to be paid by the claimant itself or its representative. Furthermore, the recovery may be awarded exclusively regarding the costs incurred by the party in the case and not the third parties. Contingency fees are permitted.
8 Are jury trials available?
Jury trials are not available in Ukraine.
9 What pretrial discovery procedures are available?
The law does not provide for pretrial discovery procedure. In some cases before opening proceedings a court may issue a preliminary injunction to secure (request) evidence that may not be available or hard to obtain at a later stage. Such preliminary injunction may be issued both with respect to the prospective defendant and any third party.
10 What evidence is admissible?
There are no particular limitations on the forms of evidence that may be put forward; however, courts have sole discretion to decide whether to admit the provided evidence.
The parties may submit any factual data, which enables the court to establish facts or other circumstances in the case. The following forms of evidence can be accepted:
- explanations of the parties and other third parties;
- written evidence, such as documents, letters, acts of public authorities and court decisions. The parties may submit copies of original documents as written evidence. The documents of foreign public authorities should be duly legalised/apostilled and accompanied by a notarised translation into Ukrainian, except for the documents issued in CIS countries;
- physical evidence (including sound and video recordings, emails, electronic files); and
- expert opinions.
Expert opinions are admissible in the form of written expert reports regarding the questions posed by the court. The parties may suggest questions to be asked and the experts to be appointed by the court.
In commercial proceedings the expert is appointed by the judge, while in civil and administrative proceedings the parties may agree to nominate an expert, who should further be appointed by the judge.
11 What evidence is protected by legal privilege?
Advice from an attorney admitted to the bar, as well as any other documentary or material evidence obtained by such attorney acting for a client, is generally considered privileged. Advice from in-house counsel is not privileged unless such counsel is admitted to the bar; there is no privilege with respect to work product of law firms established as LLCs and the like.
A company may specify in its internal documents that certain information constitutes a trade secret. If the law does not expressly exclude such type of information from that which may be treated as trade secret, such information shall be privileged.
12 Are private actions available where there has been a criminal conviction in respect of the same matter?
Competition law violations themselves are not of a criminal nature. However, private actions are available if criminal proceedings are initiated in respect of a related matter. The civil claim may be filed either within the criminal case or, if a criminal proceeding only partly concerns the relevant facts, as a separate suit referring to the facts established in a criminal proceeding.
13 Can the evidence or findings in criminal proceedings be relied on by plaintiffs in parallel private actions? Are leniency applicants protected from follow-on litigation? Do the competition authorities routinely disclose documents obtained in their investigations to private claimants?
A party to a private antitrust action may rely on evidence or findings in criminal proceedings initiated with respect to a related matter; however, in each such case a judge shall assess the evidence and findings and decide on their admissibility. Leniency applicants are not protected from follow-on litigation.
The Ukrainian antitrust authority (the AMC) does not disclose documents obtained in its investigations to private claimants. Such documents are often protected as confidential and may be disclosed only to law-enforcement authorities or to the courts in exceptional cases provided by law. However, commercial court may request for the documents from the AMC upon a motion of a party to the pending proceedings. Recent amendments to the law allow the AMC to disclose evidence if required for human rights protection. However, the mechanisms to implement these changes are not yet clear.
14 In which circumstances can a defendant petition the court for a stay of proceedings in a private antitrust action?
The court can stay the proceedings if the case cannot be resolved until another related case is resolved or until the court receives legal assistance from a foreign entity or a court. The court may also stay the proceedings for the time needed to receive the results of an expert examination, or if the court reveals a violation of law and decides to send the case file to the relevant authorities (ie, prosecutor's office) to check whether such violation has criminal elements.
15 What is the applicable standard of proof for claimants?
Is passing on a matter for the claimant or defendant to prove? What is the applicable standard of proof?
The court establishes the facts in the proceedings based on the evidence submitted by the parties. The court should assess the evidence with a comprehensive, complete and objective consideration of all the circumstances in the case in its entirety. In view of a limited number of private claims, courts have not developed any specific standards of proof with respect to competition law cases. In the most common damages claims, it is necessary to prove that:
- the defendant's conduct constituted a violation of the law;
- such conduct was intentional;
- the plaintiff has suffered damage; and
- there is a tie between the violation and the damage.
Usually, the AMC decision serves as a presumption that the conduct was unlawful (unless such decision is appealed in parallel), while the other facts are analysed by the court in accordance with the above-mentioned principles of assessing evidence.
16 What is the typical timetable for collective and single party proceedings? Is it possible to accelerate proceedings?
Under the general rule a court shall consider a case within two months (at the first-instance court and at the court of appeal). In exceptional cases in the first-instance court proceedings may be extended by another 15 days. The cassation review and review by the Supreme Court of Ukraine lasts up to one month. Taking into account the duration of appeals, it takes about six to eight months, on average, from bringing a case to trial to a final judgment. (Under certain circumstances the proceedings may take much longer, eg, if expert opinion is sought or the case is returned for a new trial at first instance, etc.)
It is not possible to accelerate the proceedings.
17 What are the relevant limitation periods?
Pursuant to the Competition Law, the general statute of limitations for antitrust violations (eg, abuse of dominant position, anticompetitive concerted practices) is five years from the date of the violation or, in the case of a continuous violation, five years as of its termination.
In civil law cases (such as compensation for damage), the general limitation period is three years from the date when an aggrieved party became, or could have become, aware of the violation of its rights. However, while considering damages claims arising from antitrust causes, the courts sometimes opined that lawsuits for compensation of damages may be lodged within the above-mentioned five-year period. However, it is unclear whether the three-year or five-year limitation period applies with respect to other private antitrust matters (eg, termination of unlawful action violating a claimant's rights, restoration of pre-violation position, etc).
The limitation period in unfair completion cases is three years from the date of the violation or, in the case of a continuous violation, three years as of its termination.
18 What appeals are available? Is appeal available on the facts or on the law?
The decision of the court of first instance may be appealed within 10 days after its announcement in full in the court hearing or (in case the full version has not been announced) after the decision is made and signed by a judge. The decision may be appealed on the following grounds:
- breach of material law;
- breach of procedural law (if the latter caused an improper court decision);
- incomplete consideration of the circumstances of the case;
- inconsistency of the court decision with the established facts of the case; and
- lack of evidence.
The court of appeal is competent to review the case within the same scope as the first-instance court.
The decisions of the court of appeal may be subject to cassation appeal by the Supreme Commercial (Civil or Administrative, as appropriate)
Getting the Deal Through - Private Antitrust Litigation 2017
Court of Ukraine within 20 days after the appeal decisions comes into force in the case of breach of material or procedural law.
The decision by the Supreme Commercial Court of Ukraine may be further appealed (although on extremely limited grounds) to the Supreme Court of Ukraine.
19 Are collective proceedings available in respect of antitrust claims?
There are no collective claims or class actions in Ukraine. However, under the law several plaintiffs may take out a joint action against the same defendant if their claims are similar and based on a similar cause of action. Also, the court may consolidate several actions if the claims are sufficiently homogeneous, ie, linked to the extent that there is no rationale for the court to hear them separately (eg, in cases concerning an indefinite number of persons). However, consolidation of claims based on competition law offences is quite rare in practice.
20 Are collective proceedings mandated by legislation?
See question 19.
21 If collective proceedings are allowed, is there a certification process? What is the test?
22 Have courts certified collective proceedings in antitrust matters?
23 Can plaintiffs opt out or opt in?
24 Do collective settlements require judicial authorisation?
25 If the country is divided into multiple jurisdictions, is a national collective proceeding possible? Can private actions be brought simultaneously in respect of the same matter in more than one jurisdiction?
26 Has a plaintiffs' collective-proceeding bar developed?
27 What forms of compensation are available and on what basis are they allowed?
The courts may impose remedies only within the limits of what is sought by the plaintiff. However, based on the petition of the plaintiff, commercial courts may go beyond the initial claims, though it is quite rare for the claimants to use this right.
It is for the claimant to determine the scope of remedies that would be sufficient to restore its rights that have been violated as a result of competition law violation.
In particular, the following remedies may be available:
- to order that a defendant discontinue an unlawful practice violating a claimant's rights and/or to force the defendant to perform certain actions (eg, in case the activity/inactivity of the defendant constitute a violation of antitrust laws and such violation negatively affects the rights or legally protected interests of the plaintiff);
- to restore the claimant's standing that would have existed should the infringement not have occurred;
- to invalidate the agreement (in case the challenged agreement has been made in violation of antitrust laws and such agreement negatively affects the rights or legally protected interests of the plaintiff);
- to invalidate a government agency's (state or municipal body) decision (eg, in case the act issued by the defendant constitutes a violation of antitrust laws and such violation negatively affects the rights or legally protected interests of the plaintiff);
- to award damages to the injured party. The court may grant this remedy if:
- the defendant's actions or activity constitute a violation of antitrust laws;
- such violation negatively affects the rights or legally protected interests of the plaintiff;
- as a direct result of such violation, the plaintiff suffered damage; and
- the amount of damage is proven by sufficient evidence; and
- to publicly disprove false and/or inaccurate, or incomplete information, or all of the above The court may grant this remedy if information disseminated by the defendant about the plaintiff is incorrect, untrue or false, and dissemination of this information negatively affects the plaintiff's business reputation.
28 What other forms of remedy are available? What must a claimant prove to obtain an interim remedy?
Interim remedies are available and may be awarded by courts both upon request of a party and on its own initiative (except for civil claims) if an omission to order interim measures could complicate the execution of the court's final decision or make such execution impossible.
As an interim remedy, a court may issue a preliminary injunction seizing the defendant's property or monetary funds, or prohibiting the defendant or third parties from taking certain actions.
Interim remedies may be applied if failure to grant them would make enforcement of a future judgment on the merits of the case impossible or complicated. In order to obtain interim remedy the claimant shall prove that failure to grant such interim remedy would make the enforcement of the future judgment on the merits of the case impossible or complicated.
29 Are punitive or exemplary damages available?
Exemplary double damages are available for the following types of competition law violations:
- anticompetitive concerted practices;
- abuse of dominance;
- implementation of a notifiable transaction without merger clearance;
- implementation of the conditionally approved merger or concerted practices without fulfilment of the conditions imposed by the AMC; and
- imposition of restrictions on business activity of an undertaking following its application to the AMC with a complaint regarding an alleged competition law offence.
Moral damages are also available and may be awarded both to individuals and legal entities. The court determines the amount of the award taking into account the nature of violation; physical or psychological suffering; degradation or loss of reputation, credit and social position; time and effort required for the recovery of initial standing; as well as a degree of guilt of the defendant (except for the claims against public authorities where the guilt on their part is presumed). Moral damages are awarded irrespective of pecuniary damages and the amount awarded alongside.
30 Is there provision for interest on damages awards and from when does it accrue?
There is no provision for interest on damages awards; the court determines the amount of damages according to the amount of actual damages and lost profit duly evidenced within the proceedings. To be awarded compensation, the plaintiff shall prove that the actual damages and the lost profit were directly caused by the defendant's violation of the law and the rights or interests of the plaintiff.
31 Are the fines imposed by competition authorities taken into account when setting damages?
Under the law the amount of damages to be awarded does not depend on the fact or amount of the fine imposed by the competition authority. In addition, courts shall take into account the defendant's actions on awarding damages to the aggrieved party based on the evidence provided by the parties.
32 Who bears the legal costs? Can legal costs be recovered, and if so, on what basis?
As a general rule, the unsuccessful party will be ordered to recover the costs of court fees, court experts' fees, translators' fees, legal costs and other expenses incurred by the winning party. If a claim is awarded in part, the costs are recovered pro rata. In case of settlement, the costs are divided between the parties in equal parts, unless otherwise agreed by the parties in the settlement agreement.
33 Is liability imposed on a joint and several basis?
As a general rule, persons committing violations of antitrust and competition laws may be held liable on a joint and several basis. However, procedural laws require that the plaintiff should clearly determine in the lawsuit the claims against each of the defendants.
34 Is there a possibility for contribution and indemnity among defendants? How must such claims be asserted?
As a matter of practice courts distribute the awarded sum between defendants based on the role of each defendant, or decide the indemnity should be joint. In the latter case a defendant who paid the whole indemnification to the plaintiff may claim a refund of the appropriate share from other defendants in line with their actual contribution, and such claim shall be asserted in a separate proceeding.
35 Is the 'passing on' defence allowed?
The passing on defence is available in Ukraine. However, owing to the lack of practice in this area, general uncertainty and difficulties in calculating damages, defendants rarely resort to this type of defence.
Under the Competition Law any person that suffered damage as a result of a competition offence has legal standing to sue. Therefore indirect purchasers may also bring actions for damages. However, we are not aware of any such cases yet, which may be explained by the difficulty of proving the fact of passing on from a direct to an indirect purchaser.
36 Do any other defences exist that permit companies or individuals to defend themselves against competition law liability?
There are no other specific forms of defence for the purposes of antitrust cases.
37 Is alternative dispute resolution available?
Ukrainian law provides for alternative dispute resolution (arbitration), which is available only upon agreement by the parties. Arbitration may be applied to practically all types of antitrust cases, with only specific exceptions, such as cases involving state authorities.
Update and trends
Private antitrust litigation is a still-developing field ofUkrainian law; there is a positive trend of a gradual growth of a number of private antitrust litigation cases in different types of antitrust matters, and this trend is likely to continue in the future. It is expected that complex reform of Ukrainian courts will increase confidence in court defence that, in turn, should have a positive effect on the development of private antitrust litigation in general.