Safeguarding collective redress: the ECJ’s ASG 2 Judgment and its implications for antitrust damages in Germany

I. Background – collective action and cartel damages claims in Germany

In recent years, the strengthening of private antitrust enforcement at the EU level has had a significant impact on Germany's legal landscape. Landmark cases have highlighted the increasing importance of cartel damages claims, strengthening both compensation efforts and accountability.[1] Simultaneously, the tension between the need for collective redress and the absence of tailored procedural instruments in Germany has become increasingly apparent—particularly in light of recent high-profile mass claims.[2] This discrepancy is especially relevant in cases involving dispersed harm and a significant imbalance in power and resources between parties. In such situations, procedural complexity and litigation costs can deter injured parties from pursuing their claims. As this is particularly common in antitrust disputes, the lack of appropriate mechanisms for bundling claims or facilitating collective enforcement threatens the overall effectiveness of private enforcement. This adds a distinctly European dimension to the domestic debate on collective redress, which formed the backdrop to the European Court of Justice`s (“ECJ”) ASG 2 Judgment.[3]

Despite a series of legislative reforms to address this issue, German law still lacks a dedicated mechanism for collective action in antitrust claims. To close this gap, claimants have relied on a workaround: the so-called “assignment model” (Abtretungsmodell or Sammelklage-Inkasso). Under this model, harmed companies assign their claims to a debt collection service provider. This entity enforces the assigned claims collectively, typically in cooperation with specialized law firms. In most cases, the debt collection provider and litigation funders assume the litigation risk in exchange for a contingency fee.

The assignment model initially triggered heated debate about its compatibility with the German Legal Services Act (Rechtsdienstleistungsgesetz or “RDG”). Critics argued that the model exceeded the permissible scope of debt collection activity due to the complexity of the bundled claims and pointed to potential conflicts of interest. Over time, however, these concerns have been addressed. The German Federal Court of Justice (Bundesgerichtshof or “BGH”) has since confirmed the model’s permissibility in various contexts (e.g. tenancy law[4], the AirBerlin insolvency[5] and the diesel emissions cases[6]). Regarding antitrust damages claims, while a formal ruling by the BGH is still pending, most substantive legal questions have been resolved.[7] However, the absence of a definitive confirmation by the BGH’s chamber for antitrust law leaves some room for uncertainty and doubt, as exemplified by the present case.

II. Preliminary Reference and AG Opinion – between facts and fiction

1. Preliminary Reference

The ASG 2 case was filed by the litigation vehicle ASG 2 Ausgleichsgesellschaft on behalf of 32 sawmills against the state of North Rhine-Westphalia before the District Court of Dortmund. The lawsuit sought damages resulting from cartel conduct in the roundwood log market. The court referred the matter to the ECJ pursuant to Article 267 TFEU.[8] In doing so, it requested clarification on whether a possible prohibition on assigning claims to legal service providers under the RDG is compatible with European law.

The reference comprised three questions, which may be summarized as follows:

• Follow-on claims: Does a prohibition on the assignment of claims to legal service providers under national law render it excessively difficult or practically impossible to enforce rights under Article 101 TFEU, thereby violating the principles of effectiveness and equivalence in the context of follow-on actions?
• Stand-alone claims: Does the same hold true in stand-alone antitrust claims?
• Consequences: If such a prohibition is found incompatible with EU law, must the relevant national provisions be disapplied?

These questions rest on two key assumptions. The first assumption reflects a structural reality: given that individual claims are often economically unviable in antitrust disputes, effective enforcement depends on collective mechanisms. Yet, absent the assignment model, German law does not offer any such collective mechanisms to effectively bundle cartel damages claims.[9]

The second assumption, however, is closer to fiction than fact. The District Court of Dortmund presumed that the assignment model violates the RDG in antitrust damages cases. It came to this conclusion before the BGH had confirmed the assignment model's admissibility also in large-scale cases involving complex matters in its financialright decision.[10] However, it maintained this stance even after the BGH's ruling and did not withdraw the referral. The District Court of Dortmund argued that the model exceeds the permissible scope of debt collection services under the RDG, citing the complexity of competition claims and the potential for conflicts of interest.[11] However, the BGH had already conceptually dismissed both arguments in other contexts, leaving little room for deviating interpretations in antitrust disputes.[12] Accordingly, while lower courts had initially taken a critical stance, appellate courts have since adopted a positive approach toward the assignment model in antitrust cases[13] (albeit only after this referral decision). Referring to these decisions in the oral hearing before the ECJ, the German Federal Government's representative took the position that there was no conflict between national and European law.

This context should be kept in mind, as it presented the Advocate General (“AG”) and the ECJ with a significant challenge. They had to strike a balance between not overstepping their authority by challenging the District Courts` dubious characterisation of national law and the need to avoid answering questions based on flawed premises.

2. The Advocate General`s Opinion

In his Opinion[14], AG Szpunar attempted to strike this balance by focusing on foundational principles and well-established standards of European law, rather than engaging in a granular assessment of the assignment model.[15]

AG Szpunar emphasized the principle of effectiveness and the guarantee of effective judicial protection under Article 47 of the EU Charter of Fundamental Rights (“EU Charter”) while acknowledging Member States’ procedural autonomy.[16] He argued that while the design of procedural rules remains within national discretion, that discretion is constrained by these principles of effectiveness and effective judicial protection.[17] By drawing a clear distinction between the constitutive conditions of the right to compensation for harm and the detailed rules governing the exercise of that right, the AG was able to avoid either endorsing or rejecting the District Court of Dortmund’s depiction of the German legal landscape outright.

Regarding the specific questions, AG Szpunar argued that the Cartel Damages Directive 2014/104/EU does not require Member States to establish any specific collective redress mechanisms. However, the treaties (Articles 101 and 102 TFEU and Article 47 of the EU Charter) obligate them to provide for the effective enforcement of cartel damage claims, even if individual litigation is unviable.[18] Consequently, where Member States do not provide tailored mechanisms and the assignment of claims thus remains the only viable option for collective redress, national rules prohibiting such assignments would render it excessively difficult to enforce rights under Article 101 TFEU.[19] At the same time, AG Szpunar acknowledged that national restrictions may be justified by legitimate objectives, such as safeguarding of professional legal standards. Yet, he emphasized that such restrictions must be necessary, proportionate, and consistent with EU principles. Ultimately, this leaves little to no room for outright prohibitions of claim assignments where alternative mechanisms are not provided.[20]

III. The ECJ`s Judgement

1. Partially inadmissible

The first question referred was declared inadmissible as it was deemed irrelevant to the subject matter of the main proceedings and therefore to the resolution of the underlying dispute (paras. 36–48).[21] That question addressed whether a prohibition on the assignment model under German law violates EU law in the context of follow-on actions, while the case at hand was a stand-alone claim.

2. On substance: a high-level decision

On substance, the ECJ found that Cartel Damages Directive 2014/104/EU does not contain specific requirements regarding procedural design, particularly with respect to instruments for collective redress. Like the AG, the Court therefore anchored its analysis in primary EU law, rather than the directive, underscoring the obligation to ensure effective enforcement of rights derived from EU competition law (Articles 101 and 102 TFEU).

Firstly, the Court reiterated its established case-law that effective enforcement of Article 101 TFEU is essential (paras 60-63). While Member States retain discretion over procedural rules, that discretion is bound by the principles of effectiveness and equivalence. Following the AG, the Court referred to Article 47 of the EU Charter as a cornerstone of the EU legal order, highlighting its importance in safeguarding the right to effective judicial protection (para 65 and 75).

Against this background, the ECJ found that—under the premises set out by the referring court—a prohibition on claim assignments under national law would breach EU primary law if it made the enforcement of Article 101 TFEU rights excessively difficult or impossible in practice (para 85). The Court thus resolved the dilemma created by the flawed depiction of German law by effectively referring the question of whether this applies to the RDG provisions back to the referring court. However, the ECJ established that such a finding requires an assessment based on three cumulative conditions[22]:

• The RDG must indeed prohibit assignment models and must not be open to a conforming interpretation under EU law (para 91, 93);
• No effective alternative mechanism for collective redress must be available in the German legal system (para 84);
• Individual litigation must be practically impossible or excessively difficult, whether due to economic disincentives or procedural barriers (para 84, 86).

The Court further stated that neither complexity nor cost alone is sufficient to establish that individual litigation is excessively difficult. Yet, even though the judgements terminology is somewhat dubious in this regard, the assessment must ultimately focus on whether the relationship between the costs of litigation and the potential benefits is disproportionate. 

The court concluded that if all these conditions are met and a conforming interpretation of national law is not feasible, the relevant provisions—such as those of the RDG—must be disapplied (para 90).

Through this principle-based approach, the ECJ found a way out of the quandary created by the referring courts flawed assumptions. By only providing a legal framework for the analysis and leaving its application to the referring court, the ECJ elegantly forced the referring court to reconsider its assessment of the assignment model's admissibility under the RDG. In doing so, the ECJ acknowledged that practically all parties (except for the referring court) believed the question referred to the ECJ was based on incorrect factual assumptions (para 78), because the fundamental admissibility of the model claim under German law was no longer in question.

IV. Implications for current and future cases

The ECJ’s judgment in ASG 2 should be understood as both contextually cautious and fundamentally important. On a general level, it provides an essential safeguard for the collective redress of antitrust damages in all Member States by establishing guardrails based in EU primary law. At the same time, it does not provide definitive answers to the specific questions raised by the referring court. Instead, it de facto refers the matter back to the national court with a framework of general conditions and standards. This cautious approach most likely stems from doubts about the premises set out by the referring court and aims at respecting the cooperative relationship between the courts under these circumstances.

Considering the recent decisions of the BGH[23] and appellate courts[24] on the assignment model, it would be unreasonable to assume that the RDG cannot be interpreted in a way that deems the assignment model admissible and is thus in line with EU law. Therefore, the ECJ's judgment is unlikely to have a real impact on ongoing cases in Germany. In practice, it could rather quickly become moot if the BGH confirms the latest appellate courts' decisions. Based on prior BGH rulings, it is anticipated that such confirmation is forthcoming.

However, the judgment sets up an important safeguard for the effective collective enforcement of antitrust damage claims in Germany and across Europe, regardless of whether tailored mechanisms are already in place. In Germany specifically, the assignment model is now protected in two ways. The AirDeal decision[25] had already established a national constitutional dimension to this issue under the German constitution (Art. 12 Basic Law). The ECJ’s reliance on EU primary law, specifically Articles 101 and 102 TFEU and Article 47 of the EU Charter, now adds an additional layer of protection against future limitations. The court emphasised that, under EU law, all Member States must ensure that there are mechanisms in place to allow for the effective pursuit of cartel damage claims, including those involving dispersed harm. This obligation is particularly pressing in stand-alone cases involving small-scale damages, where individual litigation is often unviable.

Consequently, under current conditions the admissibility of assignment models under German law appears to be mandatory in most cases. While specific bundling mechanisms may fail due to their design or implementation, fundamental counterarguments against such models have been largely disarmed by both EU and German case law.[26]

Ultimately, however, it remains the responsibility of legislators to provide or improve instruments for collective redress. Since the assignment model will now undeniably remain in place, it is time to improve its practicality and to support the courts and the parties in its application. A more coherent system for collective redress would not only align German law with EU principles but also ensure meaningful access to justice for victims of competition law infringements.