Parent Company Liability – A Question of Facts or Presumption?

Abstract

Parent company liability, as most commonly understood and discussed nowadays, concerns primarily one company’s liability to pay a fine caused by another company for the infringement of the competition rules of the European Union to which the former company has some kind of bond. As such, and in view of seemingly ever-increasing fines, the question is of obvious practical interest. Viewed from the traditional angle of European Union competition law, namely under which conditions two or more different legal entities are to be considered as one and the same undertaking or economic entity, the question would seem to be of even greater importance than just a matter of the calculation of the fine.

Imputing liability to someone other than the perpetrator gives rise to several different questions, and the objective of this article is to discuss some of these; primarily, with a view to investigating potential limits to such imputation following from the case law of the Court of Justice of the European Union (Court of Justice) or the European Court of Human Rights (ECtHR). The first and almost evident question would seem to be: why is there a need to impute liability to someone other than the perpetrator? Having answered that question, the next logical question would seem to be whether this answer has any consequences for the circumstances under which such a liability might be imputed? Given the answers to these two first questions, the way in which liability is imputed will then be assessed from different angles.