The EU Commission’s guidelines on the method of setting fines may allow an undertaking’s inability to pay to be taken into account

In these difficult economic times, companies caught up in EU competition enforcement proceedings now regularly claim that the imposition of heavy fines could put them out of business. “Inability to pay” (ITP) arguments have therefore become regular features of fines assessments and appeals. Naturally, the European Commission is focussed on deterrence and on imposing headline grabbing fines. It does not accept ITP arguments lightly, in part to avoid any suggestion that infringements will go unpunished. However, once a decision imposing fines has been published and the financial distress of the company concerned makes any payment unlikely, the Commission can be open to further discussion. First, it is possible to get a fine reduced even after the Commission has published its infringement

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