The Supreme Court has upheld the appeal filed by Caprari SpA (Caprari or Parent Company) against the decision of the SCA declaring the Parent Company guilty of conduct carried out by its Spanish subsidiary Bombas Caprari S.A. (Bombas Caprari or Subsidiary) (i.e. the Subsidiary was party to a cartel with other companies forming the Spanish Association of Fluid Pump Manufacturers (Association)).
The SCA had considered the Parent Company joint and severally liable for the fine to the subsidiary and the Association. In this context, Caprari filed an appeal before the High Court arguing a breach of the rights of defence, i.e. not having been notified of the proceedings initiated against the Subsidiary. The High Court rejected the appeal, ignoring the allegation regarding harm to the rights of defence.
On appeal, the Supreme Court has considered that, since the Parent Company owns 73.3% of the share capital of the Subsidiary and the independence between both companies was not demonstrated (rebuttable presumption), it was not possible to accept the breach of the rights of defence claimed. Thus, the Court considered that a parent company that may exert decisive influence over its subsidiary should be aware of the proceedings to which its subsidiaries are a party.
The appeal was ultimately upheld on procedural grounds. The general rule on presumption of liability of mother companies has not been revised under this Judgment.