Summary The short version of this very long post is that the Commission’s current policy of applying the concept of recidivism to the highest level parent that exercises decisive influence over the infringing company appears to unduly punish undertakings that sell a large number of different products as compared to undertakings that sell only a small number. The likelihood of being a recidivist is massively influenced by the product range of the company and not by the propensity of the company to cartelise. For the sake of simplicity the rest of this post assumes the existence of a multi-product firm with each product being sold in a different subsidiary. The increase in fine for recidivism under the Commission’s 2006 Fines […]
Defining a set of conduct as a single and continuous infringement (SCI) has significant consequences for parties to a cartel, in particular for their exposure in follow-on damages actions. It is no surprise, therefore, that the increased prevalence of damages actions in Europe has led to greater scrutiny of the Commission’s findings about SCI. In several recent judgements the General Court and Court of Justice have grappled with what to do about cases where the Commission has found a particular company to have participated in only part of a broader set of infringements, that broader set constituting – in the Commission’s view – a single and continuous infringement. We may, for example, be looking at a case where a company […]
Do the fining rules treat small companies badly? This is an occasional criticism of the 2006 Guidelines on Fines. Is it accurate? Let’s take an intentionally simplified example. Nine companies each have value of sales of 10m euros per year in a product which they cartelise. All are equally culpable (no aggravating or mitigating circumstances to take into account), save for the duration of their participation in the cartel – three had a short duration, three medium, and three long. The only other relevant difference between the companies is their total worldwide turnover; similarly three had a small turnover, three medium, three long. This gives us nine different companies which we can group – for example – by their worldwide […]
Sophie Lawrance of Bristows has written a post on the US Department of Justice investigation into high frequency trading, a practice most recently brought into public view by Michael Lewis’s book Flash Boys. In addition to saying nice things about this blog, Sophie drew my attention to the US Ninth Circuit Allied Orthopedic case which, although it came out a few months before my publication deadline for Competition Law and Regulation of Technology Markets, I’m afraid I missed at the time. A Per Se Test for Legality It’s an interesting case: the Ninth Circuit applied a per se legality test to issues of product redesign, an approach which was roundly – and rightly – criticised in this article by some […]