Leniency and Damage Liability for Cartel Members in Brazil

A recent debate on leniency policies is the interplay between the public and the private competition law enforcement. The lack of a well-established set of rules regarding damage claims may be harming the effectiveness of the Brazilian Leniency Program, either by discouraging the wrongdoers from applying for leniency in already formed cartels or by not being threatening enough to deter the cartel formation. The paper objective is to analyze the best policies for leniency applicants regarding the damage liability in Brazil. We conclude that the optimal policy is providing immunity to the leniency applicant, and after that the damage claim lawsuits can be encouraged with no undesirable effects. Extensions confirm the following: the immunity is even more effective when there is risk of betrayal; the immunity is the best policy in the case of ex-post leniency; the immunity is the optimal policy when there is no bankruptcy, otherwise the applicant liability should be the minimum necessary to avoid the bankruptcy; immunity regarding criminal sanctions for individuals is the optimal policy; for international cartels, the optimal policy is a combination of immunity regarding damage claims in all jurisdictions. JEL codes: L13; L41; L44

Claims Solutions Using a Blockchain System in International Logistics

A claim can be understood as a negative result of the performance of a contract, as it is necessary to fulfill the obligation and/or indemnify (freight damage claim, for example). Today’s claims management faces a variety of problems, such as inefficient claims postings, possible data forgery, and a very lengthy claims resolution process. All these problems can be solved by using a synthesis of innovative tools, e.g., a blockchain system, game theory, and statistical methods. Theoretical possibilities and practical examples regarding solving claims management problems were identified by analyzing various scientific sources. However, it remained unclear whether these methods could interact with each other, complicate the existing claims settlement process or not, or whether a synthesis of such measures would be viable. Therefore, a qualitative study was conducted and answers to the above questions were found. The research revealed that 75% of international Lithuanian logistics companies can apply the synthesis of these methods in claims management and solutions. Using the concordance coefficient formula, the value of W was calculated. This coefficient indicated that the opinions of the experts who participated in the study were somewhat similar. The value of the actual χ2 distribution was also calculated. The result obtained shows that the experts’ opinions were somewhat harmonized and that their compatibility was not accidental. The use of blockchain system synthesis in combination with game theory and statistical methods could help international logistics companies to reduce their costs, speed up the management process, and increase data security and reliability while ensuring structured one-stop claims management.

Modeling and Predicting of Motor Insurance Claim Amount using Artificial Neural Network

In India the insurance industry is in its growth stage. It consists of 58 insurance companies of which 24 in life and 34 are non-life insurance. The Non-life Insurance companies which cater to motor insurance business presently utilize different trend models to forecast paid claim amount. Motor Insurance Claim amount prediction is one of the most difficult tasks to accomplish in financial forecasting due to the complex nature of data points. The main objective of this study is to determine a reliable time series forecasting model to predict own damage (OD) claim amount of motor insurance data in India from 1981 to 2016. In this context, the annual time series claim data was collected and modeled by using the Generalized linear model (GLM), Autoregressive Integrated Moving Average (ARIMA) and Artificial Neural Network (ANN) method. The validation of the model has been done by comparison of predicted and actual values for the period of 36 years. Also, different types of possible models were evaluated using Akaike Information Criteria (AIC), Bayesian Information Criteria (BIC), Mean Absolute Percentage Error (MAPE), and Root Mean Square Error (RMSE) for accuracy. The results showed that ANN outperformed other traditional time series models (GLM & ARIMA) for predicting the future own damage claim amount with a lesser residual error. Further, the outcome of these data analytics studies would help Insurance companies to have an idea about the expected future claim amounts with more accuracy. Thus, predicting the Motor insurance's own damage claim will help insurance companies to budget their future revenue

Part IV Measurement, 11 Overview

This chapter provides an overview to the issue, methods, and guidance on the quantification of cartel damages. The core of any damage claim are the price overcharges. The empirical techniques which can be used to estimate overcharges (and pass-on) are set out in the European Commission’s Practical Guide. There are four approaches to quantification: before and after; yardstick; cost and margin analysis; and economic theory. One or more of three quantitative techniques can be used to apply these methods: price and financial analysis; statistical analysis; and simulation models. In considering the methods used to estimate overcharges and lost profits, there are several considerations which recur and will often prove critical to a damage claim. The two most important are (a) the impact of non-cartel factors on prices; and (b) accurately determining the cartel period.

Part III The Legal Framework, 10 Interest

This chapter addresses interest, which is awarded ‘to compensate a claimant from being kept out of his money’. Pre-judgment interest rates set by statute or the courts vary across the EU. In English law, where the claimant can prove loss of interest, it will be compensated as a damage claim. In some cases, the claimant has sought interest calculated using the Weighted Average Cost of Capital (WACC). Otherwise, the court has discretion to apply a judicial simple interest rate for the whole or part of the damage award, usually at the Bank of England Base rate plus 1% to 4%. The award of interest can be significant in a competition claim were the cartel has operated for many years and during periods of high interest rates. At common law, however, interest was not payable on damages; there were exceptions in equity.

Part III The Legal Framework, 6 Basic Elements of a Claim

This chapter summarizes on the basic elements of a damage claim. To succeed in a competition damage action in a national court, those harmed must first establish a breach of Article 101(1) TFEU or its national equivalent. The claimant must then prove that the alleged harm was causally related to the breach and then quantify their losses. A successful claimant is entitled to full compensation, which means the sum of money which puts the claimant in the same financial position it would have been had the law not been infringed. A successful claimant is also entitled to pre-judgment interest on the damages that are awarded. This is to compensate for the time cost of the money ‘taken’ from the claimant.

Part V Pass-On, 18 Overview—Pass-on

This chapter provides an overview on pass-on. Pass-on is where a business changes the prices of its goods and services in response to a change in costs of producing them. As already discussed, pass-on is allowed in EU and UK law, and is a key component of the compensatory objective of competition law damages. Pass-on operates both defensively and offensively. As a defence, it allows the defendant to reduce or eliminate an overcharge damage claim by proving that the purchaser passed-on all or part of the overcharge. This defence will invariably be invoked. Used offensively, pass-on gives the indirect purchaser the basis to damages claim. Without pass-on, an indirect purchaser could not sue the members of the cartel for damages.

Part II Economic Framework, 4 Establishing a Cartel Exists

This chapter examines the first step in any damage claim, which is to establish the existence of a cartel or, more precisely, an infringement of Article 101(1) TFEU. The claimant will typically rely on an infringement decision of a competition authority to bring a follow-on action. Without an infringement decision, proving that a cartel exists will be difficult. This is because cartels operate in secrecy, rarely leave a paper trial, and potential claimants have no right to inspect the internal documents and emails of firms they suspect are colluding. As such, competition authorities use leniency programmes to detect cartels, which offer reduced fines and other protections to encourage whistleblowing and cooperation. In addition, economic theory and statistical techniques can assist in the detection of cartels. This will become a more prominent feature of cartel enforcement in the future as competition authorities become less reliant on leniency programmes.

ANALISIS DASAR MENUNTUT PENGGANTIAN BIAYA DALAM GUGATAN PEMBATALAN PERSIAPAN ACARA PERKAWINAN DALAM PUTUSAN NOMOR: 82/Pdt.G/2014/PN.MKS

This research aims to provide information about existing law for one-sided breach of promise of marriage in Putusan Nomor 82/Pdt.G/2014/PN. Mks and to show that the defendant’s conduct of breaching the promise of marriage is a violation of law instead of a default. The defendant’s breach of promise of marriage, according to the plaintiff, brings material loss and shame because she is a doctor widely known in the society and part of the nobility in Tanah Toraja. This research/case shows that immaterial damage claim cannot be sustained in the context of default because damage compensation in a case of default consists of fee, loss, and interest. Immaterial damage claim can only be sustained in the context of violation of law and the judge should refer to article 1365 KUHPerdata about Violation of Law because the breach of promise of marriage is against the norm of propriety and morality in the society. In Putusan Mahkamah Agung RI No. 522 K/Sip/1994, Putusan Mahkamah Agung RI No 3191 K/Pdt/1984 dated 8 February 1986, and Putusan Mahkamah Agung RI No 3277 K/Pdt/2000 dated 18 July 2003, it was ruled that breach of promise of marriage is a violation of law.

Application of impact analysis SDC method for verification of whiplash injuries

Collisions of vehicles that occur in cities involve relatively low speeds. Even though the speed of a collision is not high passengers are exposed to a risk of neck spine damage when a rear-end accident takes place. These injures are referred to as Whiplash injuries which are difficult to verify when it is necessary to resolve a rear-end collision damage claim. This study presents procedures of SDC method to be used for verification of circumstances that are reported to have caused such injuries. An analysis was carried out based on a case study of a collision of two passenger cars of different categories and the results can be used by theoreticians and practitioners who are involved in research on this subject.