knowledge 4 November 2025 |

Could Competition Law Collective Damages Actions be on the Horizon for Ireland?

A recent decision from the Court of Justice of the European Union (the “CJEU”) following referral for a preliminary ruling from a German court in respect of a wood cartel¹, raises the question as to whether European Union law requires the introduction of collective damages actions in Ireland.

Collective damages in Ireland – the current position

Ireland does not have a mechanism for collective damages actions for infringements of competition law. Instead, related cases are usually case managed together and test cases used, which for example is how the 120+ follow-on damages actions against truck manufacturers arising from a Commission decision finding a breach of Article 101 TFEU have proceeded.

In addition, the assignment of claims is prohibited unless the assignee had a genuine commercial interest in the assignment.

Recently, a new civil litigation mechanism was introduced whereby representative actions can be brought by qualified entities acting as plaintiff on behalf of consumers seeking redress and/or injunctive relief for infringements of certain consumer protection legislation however competition law infringements were not included in its scope.

Third party funding of litigation is prohibited in Ireland, however this is currently under consideration by the Law Reform Commission, whose report is expected in late Spring 2026.

The German Wood Cartel

The case involved a group action for damages brought by ASG 2 (a third-party legal services provider) against the Land on the basis of compensation rights assigned to it by 32 sawmills following an infringement of Article 101 TFEU allegedly committed by the Land (and in respect of which the German competition authority had adopted a commitment decision).

The Land challenged the standing of ASG 2 to bring the claim on the basis that such so-called “collection by group action” are not permitted under German law for “stand alone actions” in respect of an infringement of competition law.

The referring court stated first, that this action is the only legal remedy that enables those persons effectively to assert, collectively, their right to compensation. Second, although those persons have the possibility of bringing an action for damages in their own name and on their own behalf, such a possibility does not, however, enable them to exercise that right effectively. In the light of the particularly complex, long and costly nature of an individual action concerning an infringement of competition law, injured persons would tend to refrain from bringing such an individual action, in particular where harm equating to a low value is at issue.

As a result, the German court in essence asked the CJEU whether the principle of effectiveness under EU law² precludes an interpretation of national legislation that has the effect of preventing persons allegedly harmed by an infringement of competition law from assigning their rights to compensation so that they may assert them in a standalone action for damages.  

The Court noted that Article 4 of the Damages Directive provides that “[i]n accordance with the principle of effectiveness, Member States shall ensure that all national rules and procedures relating to the exercise of claims for damages are designed and applied in such a way that they do not render practically impossible or excessively difficult the exercise of the Union right to full compensation for harm caused by an infringement of competition law.” The Court noted that due to the nature of competition law cases (requiring complex economic and factual analysis), that the “existence of mechanisms enabling individual claims to be grouped together is likely to facilitate the exercise of the right to compensation”.

The CJEU ultimately answered the questions referred in the affirmative provided that:

• national law does not provide for any other possibility of grouping together the individual claims of those injured persons that would ensure the effectiveness of the exercise of those rights to compensation, and
• the bringing of an individual action for damages is, having regard to all the circumstances of the case, impossible or excessively difficult for those persons, with the result that they are deprived of their right to effective judicial protection.

Should it not be possible to interpret that national legislation in a way that complies with the requirements of EU law, those provisions of EU law require the national court to disapply that national legislation.

What this could mean for Ireland

The CJEU's decision in the German Wood Cartel case could have significant implications for the private enforcement of competition law in Ireland. As Ireland does not have a means of collective redress, the question arising is whether the procedure for bringing individual actions for damages is “excessively difficult“.  This will ultimately be a question of fact to be determined on a case-by-case basis.

The case underscores the importance of ensuring that national laws do not hinder the exercise of EU law rights though it remains to be seen whether it prompts any reforms in Ireland.