COMPETITION • EUROPEAN LAW • PROCEDURE
The Commission imposes the fine provided for in Article 23 of Regulation No 1/2003 on the undertakings which adopted the practices in question or on those responsible for them at the date of its decision. The imputability of the infringement gives rise to difficulties where the offending undertaking has undergone restructuring i.e. a change in its structural organization or corporate form, since the date on which the infringement was committed. Restructuring may consist of a merger, a merger-absorption, a transfer of shares, a partial contribution of assets, etc.
According to the competition authorities, in the event of an undertaking’s reorganization, the infringement must be imputed to the entity that ensures the economic and functional continuity of the perpetrator of the anticompetitive behavior. The analysis is broken down into three stages. The first consists in identifying the undertaking that committed the infringement; the second in verifying whether, following restructuring, that undertaking still exists or has been liquidated; the third in determining liability. If the undertaking subsists, it remains liable, otherwise the infringement is attributable to the undertaking to which the material and human resources that contributed to the commission of the infringement have been transferred. Different scenarios may arise:
– Merger or merger by absorption : the infringement is attributable to the entity resulting from the merger of the two undertakings that adopted the restrictive behaviors, since it ensures the economic and functional continuity of these undertakings. In the case of a merger-absorption, the acquiring undertaking is liable for infringements committed by the absorbed undertaking prior to the transaction, even if the assets that contributed to the infringement were previously transferred to a third party. Where the merger takes place between two related companies, the Commission is entitled to impute liability for the infringement to the acquiring company without having to seek the possible liability of their parent company.
– Merger/division : in the event of a division of a company participating in the cartel, the undertakings arising from the division which continue to manage its production plants are jointly liable with the company for the payment of the fine up to its winding up where they form an economic unit
– Transfer: the right to take action against an undertaking on the basis of competition rules is not extinguished by the mere fact of the acquisition of its shares by a third party. The transferee’s liability is excluded if, at the date of the decision, the offender continues to exist in law. The rule applies to the total transfer of an undertaking as well as to the transfer of a branch of activity. However, even if the original undertaking remains, the undertaking that has taken over all its activities in the sector concerned by the anticompetitive practices is deemed to ensure its economic continuity when the two companies are united by structural links. This is the case when, at the time of the infringement, both entities are wholly owned by the same undertaking, which effectively exercises decisive influence over them. The public or private nature of the controlling company is irrelevant. The Commission is not obliged to seek the ultimate liability of the parent company, but may attribute the infringement to the transferee alone. Conversely, the Commission is not obliged to impute the infringement committed by a subsidiary to the third-party acquiring group, where the parent company continues to exist legally and economically, nor is it obliged to divide the basic amount of the fine between the transferor and the transferee where the transfer took place in the middle of the infringement period, since the gravity of the infringement does not necessarily have to be assessed in the light of the actual impact of each undertaking’s conduct on competition.
According to case law, in order to establish the existence of a situation of economic continuity, the relevant date for assessing whether the transfer of activities takes place within a group or between independent undertakings, must be that of the transfer and not that of the adoption of the decision sanctioning the infringement. It is therefore irrelevant whether the structural links between the undertakings were of short duration, as in the case where the transferee entity was created and received the assets with a view to a subsequent transfer to an independent third party.
– Change of type of undertaking or name: a change in the legal form and name of an undertaking does not have the effect of creating a new undertaking free of liability for the anticompetitive behavior of its predecessor.