Basic economic tools of analysis imply that overcharges imposed by cartels or monopolists are not entirely, if at all, absorbed by their direct purchasers. The harm is instead inflicted upon actors in an indeterminable number of submarkets. The net effect varies depending on the time scope, the nature of competition in the downstream markets and on the proportion of demand-supply elasticity in those markets. Under EC antitrust law it is unclear whether this so-called passing-on reasoning should be accepted in private litigations. The eventual answer will constitute a major policy choice for EC antitrust law in general. Assuming that competition law ought to enhance overall social welfare, a theoretic model can be borrowed from relevant US literature to gain an understanding of how the damage remedy should be contemplated within the system of EC antitrust law and how the passing-on question should be dealt with.
World Competition