Private Equity and Competition Law: The General Court Confirms Competition Liability of a Private Equity Investor for Competition Breaches Made by the Investee

In its judgment released in The Goldman Sachs Group v Commission, the General Court of the EU has confirmed a strict application of the parental liability rule to private equity investors. Pursuant to the doctrine of single economic entity, private equity funds may be held liable for the competition fines levied for the anti-competitive on the basis of the presumption of actual exercise of decisive influence. Importantly, as clarified by the Court, the presumption also applies to investors that have all the voting rights associated to the shares of the investee in combination with having a high majority stake in such companies. An investor meeting this condition can be likened to a parent company that own the entire share of the subsidiary.
The paper is available here. 

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