Don’t blame the children. Why inverted and horizontal liability for antitrust infringements should be rejected

This article analyses some new questions that have emerged as a result of the transposition of the single economic unit doctrine to the realm of private enforcement. The doctrine, originally developed in the context of public enforcement of EU competition law, allows liability to be attributed to parent companies for infringements committed by their subsidiaries, thereby disregarding the corporate separateness of the legal entities involved in order to reflect their economic unity in the market. As antitrust damages become more common throughout Europe, the single economic unit doctrine requires further clarification. In particular, it is not evident whether the doctrine may also apply in an inverted or horizontal manner: whether subsidiaries might be held liable for antitrust infringements committed by their parent companies or whether companies might be held liable for antitrust infringements committed by other entities controlled by the same parent company. This question has led to divergent decisions by national courts throughout Europe. This article rejects the idea of group company liability for antitrust infringements and argues against the automatic recognition of horizontal or inverted liability, which is believed to amount to a violation of general principles of EU law and which cannot be justified on grounds of deterrence, nor on the principle of effectiveness.