French Court Puts New Owners on Hook for M&A Targets’ Old Crimes
- Buyers can face fines for companies’ previous wrongdoing
- Ruling in case over industrial accident may complicate M&A
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France’s top court may have complicated future merger deals in the country, ruling that companies should be criminally liable for wrongdoing at firms they acquire.
The Cour de Cassation on Wednesday ruled that a buyer can face criminal fines or confiscation for an offense committed by the target before the transaction, a reversal of established French case-law. The case concerned a company that was involved in an accident nearly two decades ago, before it was purchased.