The Trade and Industry Appeals Tribunal (CBb) has held that a parent company may have an interest in bringing proceedings against a decision by the Authority for Consumers and Markets (ACM) even if the company is not a direct addressee of that decision (decision of 18 February 2020 in case ECLI:NL:CBB:2020:91). The CBb confirmed its earlier case law that, even if the ACM does not impose a fine, a party may still have an interest in appealing this decision (ECLI:NL:CBB:2019:329).
Specifically, if a legal entity does not have a fine imposed on it but is an addressee of the ACM's decision, or if a legal entity is not directly addressed by the ACM's decision but is held jointly and severally liable for a fine imposed on its wholly-owned subsidiary due to it being a parent company, this legal entity is understood to be directly interested in the decision. It can therefore appeal an ACM decision about an alleged breach of competition law.
Background to the case
The case at hand relates to an alleged infringement of the cartel prohibition, in which the ACM originally imposed a fine on legal entity X. The ACM decided that this entity was only jointly and severally liable for part of the imposed fine, whereas its parent, legal entity Y was held jointly and severally liable for the total amount of the fine. Legal entity Y was not a direct addressee of the decision.
After the objection proceedings at the ACM, the ACM lowered the fine imposed on legal entity X, and decided not to impose a fine on legal entity Y due to its inability to pay. Legal entity Y appealed this decision to the Rotterdam District Court. The Rotterdam Court held that the challenged decision had no negative legal effects for legal entity Y and that consequently legal entity Y had no cause of action due to the lack of interest.
The CBb quashed this decision. It held that, in the context of an ACM decision, there are several risks for parties that have not received a fine for a breach of competition law, but are still mentioned as infringer and/or as a parent company in the decision. These parties may face: exclusion from tender procedures, actions for civil damages, reputational damage and higher fines in cases of recidivism. In addition, individuals – if they are mentioned as executives who were responsible for competition law breaches – can be excluded from board positions for a certain period. Hence, there are – contrary to what the Rotterdam Court held – negative legal effects for these parties, who therefore have an interest in bringing proceedings.
A company may be relieved when it avoids receiving a fine from the ACM. However, a decision that considers it to be a competition law infringer or jointly and severally liable for a fine due to being a parent company can still have far-reaching consequences and risks. It is therefore advisable to appeal any decision from the ACM in which you are – as a legal entity or as a natural person – considered to be a competition law infringer to try to prevent this decision from becoming irrevocable. The CBb has rightly confirmed that this is possible.