Piercing the Corporate Veil: The German Sausage Saga

By Mareike Walter & Martin Schunke (Hogan Lovells)

The question under which circumstances an undertaking is liable for its own competition law infringement – not to mention the liability for infringements committed by an affiliated undertaking – is of invaluable practical importance. From the early days of European competition law, there has been an interesting legal relationship between the ‘single economic entity’ as the addressee of EU competition law and the respective entities under national corporate laws. Legend has it, businesses in some European jurisdictions can avoid fines by way of corporate restructuring, whilst in other jurisdictions this is not an option. The present contribution traces the developments in the EU and in Germany during recent years with special regard to the so-called German ‘sausage gap’ – a once well-known and much exploited lacuna that helped shelter companies from liability through specific corporate restructuring.

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