Are managing directors liable for antitrust fines? BGH appeals to ECJ

The current proceedings before the German Federal Court of Justice (BGH) concern claims for damages by two affiliated companies (a GmbH and an AG) against their former managing director and board member, respectively. According to the Federal Cartel Office’s findings, the defendant participated in a cartel in the steel industry in both functions from 2002 to 2015, which resulted, inter alia, in price-fixing agreements.

Lower courts partially agree with the companies

The Federal Cartel Office imposed a fine of EUR 4.1 million against the GmbH as a result of this conduct in breach of antitrust law. The GmbH is now reclaiming this fine as damages from its former managing director. The AG, on the other hand, is demanding compensation from the defendant for the investigation and legal costs incurred as a result of the antitrust investigation and the defense against the fine. Both companies are also seeking a court declaration that the defendant must compensate the consequential damages resulting from the antitrust violation.

The companies’ claims were upheld in the lower courts only in part. Both the Regional Court of Düsseldorf (judgment of December 10, 2021, case no. 37 O 66/20) and the Higher Regional Court of Düsseldorf (judgment of July 27, 2023, case no. VI-6 U 1/22) ruled that the defendant was not liable to the companies for fines imposed by the Federal Cartel Office.

According to the lower courts’ opinion, the purpose of antitrust fines against companies would otherwise be undermined. The antitrust fine imposed was aimed precisely at affecting the assets of the fined companies. The legal and investigation costs were also not eligible for compensation. However, the defendant was liable for compensation for further damages resulting from the antitrust violation, in particular the costs of actions for damages.

Referral to the ECJ: Does EU law conflict with national regulations?

The BGH stated that managing directors and board members who violate their duties are liable to the company for the damage incurred. According to the BGH’s preliminary assessment, the national legal system does not generally disapprove of seeking recourse for fines against the responsible management. However, the principle of effectiveness under EU law (effet utile) could require the prohibition of companies seeking recourse against their directors.

It is true that the detailed formulation of antitrust fines falls within the competence of the Member States. However, according to ECJ case law, the Member States must ensure that the national competition authorities can impose effective, proportionate and dissuasive fines on companies if they intentionally or negligently violate the European ban on cartels in Art. 101 (1) TFEU.

The BGH therefore referred the question to the ECJ as to whether Art. 101 (1) TFEU precludes a national regulation on managing director liability for antitrust violations (decision of February 11, 2025, file no. KZR 74/23).

Significance for companies and managing directors

The question of the managing directors’ liability for antitrust fines imposed on companies has long been unresolved. It will probably take some time for the ECJ to issue a clarifying ruling. However, this issue is of enormous importance for both companies and managing directors. If the ECJ should come to the conclusion that European law does not preclude the liability of managing directors for antitrust fines, responsible managing directors could face existential risks.

Irrespective of this, according to the BGH’s preliminary assessment, responsible managing directors are liable for antitrust fines in the event of violations of the German ban on cartels. A possible decision by the ECJ will not change the necessity of intensive and effective compliance measures in order to prevent possible breaches of duty a priori and thus avoid antitrust fines.