Single Entity Tests in US Antitrust and EU Competition Law
39 Pages Posted: 20 Jul 2011
Date Written: June 21, 2011
Competition law structures economic entities’ market behaviour. The notion of economic entity potentially captures distinct corporate legal persons within a single economic enterprise. To the extent that these distinct corporate legal entities present a single entity, competition law enforcement profoundly alters in scope.
On the one hand, single entity notions provide a defense for multiple corporate entities to avoid antitrust scrutiny. On the other, they embolden competition authorities to impute fines for competition law infringements committed by subsidiaries or affiliates to parent or otherwise affiliated companies. The U.S. Supreme Court opinion in American Needle seems to have curbed enthusiasm for single entity defenses, whereas increasing reliance on parent company liability transformed EU single entity claims into powerful prosecutorial devices.
This article explores the conditions to establish successful single entity claims in U.S. antitrust and EU competition law. Both legal orders apply similar conceptions of (corporate) control and (market) conduct to determine the scope of single entity claims. In so doing, control and conduct have been operationalized in different ways, leaving significant gaps or inconsistencies in the development of a true single entity test. The juxtaposition of both single entity approaches aims to contribute to remedying those inconsistencies.
Keywords: EU competition law, US antitrust law, theory of the firm, undertaking, single entity, American Needle
JEL Classification: K21, K22
Suggested Citation: Suggested Citation