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Inability-to-Pay Fine Reductions in European Cartel Cases

Inability-to-Pay Fine Reductions in European Cartel Cases The European Commission can consider ‘the economic and social context’ of cartel members when imposing fines. This article investigates the process behind the inability-to-pay fine reductions. These fine reductions are rare and its process opaque. This article looks at the European Commission opinions and the case law to shed some light on the process. This article also collects data on companies involved. We found that 18.3% of applicants were granted some reduction. Applicants behave as expected: companies that are more likely to become insolvent are more likely to apply for a fine reduction. But the European Commission does not grant fine reduction based on insolvency propensity. These results show the importance of transparency to avoid further waste of resources in applying and investigating fine reduction claims. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png World Competition Law and Economics Review Kluwer Law International

Inability-to-Pay Fine Reductions in European Cartel Cases

World Competition Law and Economics Review , Volume 44 (2): 22 – Jun 1, 2021

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Publisher
Kluwer Law International
Copyright
Copyright © 2021 Kluwer Law International BV, The Netherlands
ISSN
1011-4548
Publisher site
See Article on Publisher Site

Abstract

The European Commission can consider ‘the economic and social context’ of cartel members when imposing fines. This article investigates the process behind the inability-to-pay fine reductions. These fine reductions are rare and its process opaque. This article looks at the European Commission opinions and the case law to shed some light on the process. This article also collects data on companies involved. We found that 18.3% of applicants were granted some reduction. Applicants behave as expected: companies that are more likely to become insolvent are more likely to apply for a fine reduction. But the European Commission does not grant fine reduction based on insolvency propensity. These results show the importance of transparency to avoid further waste of resources in applying and investigating fine reduction claims.

Journal

World Competition Law and Economics ReviewKluwer Law International

Published: Jun 1, 2021

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