Antitrust Fines and Managerial Liability

Jens-Uwe Franck () and Till Seyer ()

CRC TR 224 Discussion Paper Series from University of Bonn and University of Mannheim, Germany

Abstract: If an antitrust fine has been imposed on a company, the question of managerial recourse liability arises. We present court cases from the Netherlands, the UK, and Germany, in part denying managerial liability and claiming that it would undermine the fines’ deterrent effect. We analyse whether managerial liability should be limited or banned to prevent, on the one hand, the company or its shareholders being under-deterred or, on the other hand, the company’s management being over-deterred. Regarding the former, we argue that a ban of managerial liability – which would have to be accompanied by a ban on any other type of internal financial sanction – would take an indispensable governance instrument out of the hands of shareholders. This holds true despite the availability of D&O insurance. Regarding the latter, we identify risks of over deterrence but also see mitigating mechanisms at work. We conclude that, while a restriction on managerial liability may be regarded a reasonable measure, this should be viewed as lying within the discretion of company law legislation and jurisprudence but not as a mandatory implication of antitrust fining laws.

Keywords: antitrust law; cartels; antitrust fines; deterrence; managerial liability; antitrust compliance; D&O insurance; EU law; principle of effectiveness (search for similar items in EconPapers)
JEL-codes: K21 K22 K42 L40 (search for similar items in EconPapers)
Pages: 41
Date: 2023-05
New Economics Papers: this item is included in nep-com, nep-eur, nep-law and nep-reg
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Persistent link: https://EconPapers.repec.org/RePEc:bon:boncrc:crctr224_2023_429v2

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