Insolvency, Competition, and the Theory of the Firm

The paper examines the recent developments in the field of business crisis management, with a focus on the European and US legal cultures. The main argument is the need for a consistent framework between insolvency and competition law in the theory of the firm. The present analysis reveals the need for a proper balance between the principle of competition on the merits and the philosophy of business-rescue in order to avoid dysfunctions in the application of insolvency and antitrust statutes. After an overview of the main contact cases between the two disciplines, the article addresses the main lawmakers’ responses to this problem. In this context, the regulation on banking crises management represents a first attempt to strike a proper balance between the (apparently compelling) goals underlying insolvency and competition law. This article aims at providing some guidance for a systematic reading of the two disciplines. Moving from a holistic understanding of the theory of the firm, it suggests assigning competition law a pivotal role in order to pursue efficiency in the market and consistency in legal theory. Investment funds, reserved AIFs, share classes, fair treatment, seniority privilege, minimum interest privilege, non-contagion principle, preferential treatment, shift of wealth