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Revisiting Parental Liability in EU Competition Law

Research output: Contribution to journalArticlepeer-review

Original languageEnglish
Pages (from-to)145-166
Number of pages22
JournalEUROPEAN LAW REVIEW
Volume43
Issue number2
Accepted/In press13 Feb 2018
Published1 Apr 2018

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Abstract

Why are parent companies held liable for the infringements committed by their subsidiaries under EU competition law? This article examines the jurisprudence of the EU Courts with a view to illuminating the rationale underpinning parental liability. Taking a closer look at the “single economic unit/undertaking” explanation endorsed by the Courts post-Akzo, it demonstrates that this doctrine lacks the exegetical power assigned to it, insofar as it is based on a fallacious reasoning. With this in mind, two alternative justifications for parental liability are then discussed: the “failure to exercise vigilance” theory and the “enterprise” rationale. As the article illustrates, both justifications have their advantages and limitations. Ultimately, the final choice lies with the EU Courts, but it is submitted that, all things considered, the “failure to exercise vigilance” argument offers a better-or at least more realistic-solution to the problem of developing a coherent explanation for parental liability in EU competition law.

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