Seppe Maes, Caroline Buts, Marc Jegers

European Competition and Regulatory Law Review, Volume 7 (2023), Issue 3, Page 145 - 153

Cartel investigations and subsequent Commission decisions can negatively impact a company’s reputation and stock market value. Using an event study methodology, this paper quantifies the effect of a Commission decision on the market value of companies involved and investigates whether the fact that a dawn raid took place has an additional effect on the impact of the subsequent decision. The findings are based on an exhaustive recent sample of 373 observations of listed firms involved in cartel cases between 2001 and 2022. We conclude that a dawn raid has a clear negative effect of -2.04% on a firm’s stock price in the anticipation period prior to a decision. We attribute this to the fact that a dawn raid generates media coverage, bringing more attention to the case and making it widely known to investors. An anticipation effect is absent in cartels where no dawn raid took place, suggesting that a dawn raid entails a more prolonged and more negative effect on stock prices. Keywords: antitrust; cartel; dawn raid; European Commission; event study

Seppe Maes, Caroline Buts, Marc Jegers

European Competition and Regulatory Law Review, Volume 7 (2023), Issue 3, Page 189 - 192

Annotation on the Judgment of the Court (Third Chamber) of 29 June 2023 in Case C-211/22 Super Bock Bebidas SA and Others v Autoridade da Concorrência In its judgment of 29 June 2023, following six questions referred for a preliminary ruling, the Court of Justice of the EU provided clarity in dealing with a vertical case involving resale price maintenance (RPM).1 A topic that had already undergone considerable evolution in existing case law, from a phenomenon that was considered as restrictive by object, following among others the Binon case, to a much more nuanced view in which the Court noted that the agreements should be assessed in their appropriate legal and economic context where the restrictive effect should be established first.

Seppe Maes, Caroline Buts

European Competition and Regulatory Law Review, Volume 6 (2022), Issue 2, Page 108 - 119

Companies under investigation for anticompetitive behaviour in breach of the competition rules face heavy fines, high legal costs, loss of future profits and reputational damage. In addition, listed companies also seem to (temporarily) experience negative shocks in their stock market value. This article provides a descriptive analysis of the impact of the European Commission’s press release, announcing an antitrust investigation, on the stock market performance of the companies involved. Furthermore, we discuss the influence of the press release covering the Commission’s decision and accompanying fine. Reviewing four cases for each of these two moments, we conclude that an antitrust investigation or fine can be linked to a substantial negative shock to the stock market value of the companies concerned. While the drop is sizeable and thus clearly visible for almost all companies, the effect also seems to be relatively short-lived. Interestingly, the effects mostly seem more pronounced for the announcement of the investigation than for the fine, with some cases barely showing an effect of the latter. This could indicate that the stock market already accounts for the full effects around the time of the initial announcement. Keywords: antitrust; cartel investigation; impact assessment; stock market performance