Saturday, 14 June 2014

The Asphalt Cartel Decision and the Transfer of Liabilities in Business Purchase Situations

Dear All,

Our associate Kiira Lehtonen has reviewed the latest asphalt cartel case (decision L 09/49467 of the Helsinki District Court on 28 November 2013, “Decision”) and wrote an analysis of this remarkable case focusing on the aspect of transfer of liabilities in business transfers. This is perhaps slightly ignored aspect of the decision but definitely a point of which all M&A lawyers such as such should be aware of. The main theses of Kiira in summary:

"While the reasoning of the Helsinki District Court behind the transfer of liabilities for damages between companies may even be well understood and accepted, it cannot be left unnoticed that Finnish law does not in itself recognize the in damages cases, but only in penalty payment cases, which, as stated above, fundamentally differ from damages cases as they are public in nature. It is in any event highly probable, if not certain, that in addition to many other parts of the Decision, this question will be discussed in further detail during the appeal proceedings. In the meanwhile, however, companies should not completely ignore the possibility of transfer of liabilities for damages in connection with transfers of businesses, as the situation still remains uncertain. Taking this possibility into account at least on some level might help to avoid unpleasant surprises in the future."

The full text of this legal update is available from: here.

Pleasant reading moments!

Jan