The Court of Justice confirms the possibility to attribute liability to the parent companies of a full-function joint venture…

On 26 September 2013, the European Court of Justice ("Court of Justice") dismissed the appeals by EI du Pont de Nemours and Company ("EI DuPont") and The Dow Chemical Company ("Dow") against the judgments of the General Court ("GC") and confirmed their liability in the chloroprene rubber cartel.

Both appeals focus on the attribution of joint and several liability to EI DuPont and Dow as the parent companies of the full function joint venture DDE, which was found to have participated in the infringement.

The Court of Justice held that the General Court had not erred in law in upholding that the liability for the unlawful conduct of an equally owned joint venture can be imputed to its parent companies where the Commission has demonstrated that the parent companies have exercised decisive influence over the joint venture on the basis of factual evidence and having regard to all the economic, organisational and legal links between them.

The fact that a joint venture is autonomous within the meaning of the EC Merger Regulation does not mean that it enjoys autonomy in relation to adopting strategic decision and that it is therefore not under the decisive influence of its parent companies for the purposes of Article 101 TFEU.

Further, the Court of Justice ruled that the GC had not misconstrued the concept of 'single undertaking'. It held that where two parent companies hold 50% each of a joint venture that has infringed competition law, "it is only for the purposes of establishing liability for participation in the infringement of that law and only in so far as the Commission has demonstrated that both parent companies exercise decisive influence over the joint venture, that those three entities can be considered to form a single economic unit and therefore a single undertaking for the purposes" of Article 101 TFEU.