![]() Once this is done, the undertaking constituted by that economic unit of which the infringing legal entity forms part is to be treated as having committed the infringement. ![]() This purpose must prove that at least one legal entity within the economic unit has committed an infringement. It is right after this introduction when the ECJ’s position regarding the APB’s question starts materialising in the judgment text.įirst and most importantly, the ECJ recalls that, when an economic unit infringes the rules on competition in the EU, it is for that economic unit to answer for such infringement. Although there is nothing new in these statements, the ECJ (once more) clearly shows its willingness to ensure consistency between public and private enforcement of competition law as deterring tools against anti-competitive behaviours in the market. The ECJ continues and highlights the intentional use of the concept of “undertaking” by the regulator not only in Article 101 TFEU, but also in secondary legislation such as Articles 23(2) of Regulation 1/2003 and 2(2) of Directive 2014/104/EU ( Damages Directive), to further support the idea that EU competition law as a whole targets the activities of undertakings, understood as economic units (even if in law such economic unit consists of several persons, natural or legal) (paras. Indeed, as the ECJ ruled in Skanska, actions for damages for infringements of competition law are an integral part of the system for its enforcement, and, thus, the concept of “undertaking”, within the meaning of Article 101 TFEU, cannot have a different scope for this purpose as compared to public enforcement of competition law. The ECJ starts recalling the main case law in the field of private enforcement of competition law and the role of the latter as co-guardian – altogether with its public enforcement – of the full effectiveness of Article 101 TFEU. Fundamentally, AG Pitruzzella concluded that whether subsidiaries can be held liable for the infringements of their parent companies or not depends on what the exact foundation of parental liability under EU competition law is: (i) the exercise of control or decisive influence over the infringing legal entity, or (ii) the mere existence of a single economic unit between the infringing legal entity and the one that is being held accountable.Ĭonsequently, AG Pitruzzella put the ECJ in some kind of Morpheus’ red pill or blue pill dilemma as regards the determination of the specific element that triggers joint and several liability between undertakings that form part of the same economic unit – until now. In this regard, the APB decided to suspend proceedings and refer the question to the ECJ for a preliminary ruling.Īdvocate General ( AG) Giovanni Pitruzzella issued his non-binding Opinion on the case in April 2021, which was already commented in a previous entry on this blog. However, the question of whether a subsidiary can be held liable for the anti-competitive behaviour of its parent company was never addressed before, either in a public or private enforcement context. Under the single economic entity doctrine, parent companies can be held liable for their subsidiaries’ anti-competitive behaviour. ![]() On 24 October 2019, the Audiencia Provincial de Barcelona ( APB) faced a claim for damages by Sumal against Mercedes Benz Trucks España, a subsidiary of the German company Daimler AG to whom the European Commission’s ( EC) infringement decision in the Trucks cartel was not addressed. On 6 October 2021, the European Court of Justice ( ECJ) issued its very much-awaited judgment in case C-882/19 Sumal, one of the most important cases in private enforcement of competition law of the last years.įor those of you that are new to the case, the facts are as follows.
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