Vicarious Liability in Groups of Companies and in Supply Chains – Is Competition Law Leading the Way?

Abstract

In competition law, it has been established since long that a parent company and a subsidiary under certain conditions may be regarded as a ‘single economic unit’ – an ‘undertaking’ – with the consequence that the parent company can be held liable if the subsidiary has incurred criminal liability for competition law infringements. Although this parental liability has been much criticized, with the Skanska decision, the liability of the parent company for the acts and omissions of the subsidiary (‘vicarious liability’) has been widened. The question of parental liability for competition law infringements is part of a wider question of the possible liability of companies for acts and omissions of other companies with which they are somehow linked. This article firstly describes the development of the concept of the undertaking in the area of competition law and examines the implications of the Skanska decision for groups of companies with regard to competition law infringements (section 2). Secondly, it asks whether a similar pattern of development can be found in other areas of the law and whether the solutions adopted in competition law can be transferred to these other areas (section 3) and thirdly, whether the concept of an undertaking could be applicable not only to companies linked by ownership but also to companies linked by contract (section 4).