Do leniency recipients receive any benefit in the damages litigation context?
Leniency recipients receive some protection regarding evidence production in the sense that courts cannot order the production of leniency declarations, except to verify whether they are indeed such declarations. They cannot be used as evidence.
Furthermore, immunity recipients have a partial defence against claims which are brought against them for joint and several liability with other infringers. This defence enables them to limit their exposure to the losses suffered by their direct or indirect customers or suppliers (see above, question 4).
Leniency agreements do not reach the civil sphere, focusing instead on the criminal and administrative spheres. As a result, successful leniency applicants are not exempt from liability in civil claims.
Nonetheless, the Bill 11.275/2018, which is currently being processed under the Brazilian House of Representatives, proposes certain changes regarding the award of civil compensation from cartel damages. One of these proposals is the introduction of double damages for those harmed by a cartel infringement. In case such Bill is approved, leniency recipients will benefit from being excluded from the double damages obligation.
As analysed above, PRC competition rules are silent on whether leniency applicants would be given any beneficial treatment in follow-on competition damages claims. However, it is largely believed that the leniency recipient will not receive such benefit. That being said, it is also noteworthy that, according to Art. 16 of the Draft Leniency Guidelines, materials such as reports submitted by undertakings for leniency application and documents generated therefor shall be kept confidential and shall not be used as evidence for relevant civil proceedings, unless otherwise stipulated by law.
Pursuant to Law 113(I)/2017, the amount of contribution of an infringer which has been granted immunity from fines under a leniency programme shall not exceed the amount of the harm it caused to its own direct or indirect purchasers or suppliers.
To the extent the infringement of Competition Law has caused harm to injured parties other than the direct or indirect purchasers or suppliers of the infringers, the amount of any contribution from an immunity recipient to other infringers shall be determined in the light of its relative responsibility for that harm.
Leniency recipients do not receive any benefit in the damages litigation context due to the fact that leniency policy only applies in criminal litigation context under Egyptian Law.
Immunity recipients (receiving full immunity from fines) and second-ranked leniency recipients (receiving fine reductions) are not immune from liability vis-à-vis victims of their competition law infringements.
However, based on the provisions introduced into French law as part of the implementation of the Damages Directive:
- immunity recipients are slightly less exposed to the risk of payment of damages than second-ranked leniency recipients and other participants to the infringement. Indeed, as a principle, an immunity recipient is jointly and severally liable only to its direct or indirect purchasers or suppliers (article L. 481-11 FCC) (see above the response to Question 4).
However, by way of exception, an immunity recipient may be liable for the damage caused to other injured parties only where these victims are unable to obtain full compensation from the other undertakings that were involved in the same infringement of competition law (article L. 481-11 FCC).
- Where an infringer which has compensated victims seeks contribution from other co-infringers, the amount of contribution of an immunity recipient may not exceed the amount of harm caused to its own direct or indirect purchasers or suppliers (article L. 481-12 FCC).
It should be borne in mind that these provisions are only applicable to damages claims based on infringement of competition law that occurred after 11 March 2017.
For claims that have arisen until 26 December 2016, there were no benefits for leniency applicants with regard to private enforcement. Since the respective competition authorities’ decisions became frequently final and binding upon the leniency applicants first and they had contributed significant contemporaneous documents and corporate statements to the competition authority, they were the most obvious and attractive target for follow-on claims and often faced damage claims considerably sooner than other cartel members.
To sooth this tension between leniency cooperation and the risk of private follow-on damage claims in cartel cases, the implementation of the EU Damages Directive brought with it a number of changes. Under the current law (claims that have arisen after 26 December 2016), a privileged treatment of leniency witnesses is now explicitly set out in section 33e GWB. According to this provision, the liability of the immunity recipient, ie the cartel member who has received immunity from fines under a leniency programme, is limited to the harm caused to its own direct or indirect purchasers or providers. Beyond this, cartel victims may only turn to the leniency recipient if they have not been able to obtain full compensation from the other infringers.
The non-privileged infringers continue to be jointly and severally liable towards any cartel victim (see section 33d GWB). If a direct or indirect supplier or customer of the privileged leniency applicant or any of the other cartel members sues a non-privileged cartel member, this cartelist can afterwards take recourse against the leniency applicant in the amount of the latter’s share of liability, yet only up to the amount of harm the leniency applicant caused to its own direct or indirect purchasers or providers (see section 33e para 4 GWB). Recourse is excluded if the cartelist is sued by its own customers or supplier or those of another non-privileged cartel member. If the claimant is no direct or indirect supplier or customer from any cartelists but suffered a damage due to umbrella effects, the cartel member may take recourse against the leniency applicant even if the applicant cannot be held liable directly by the cartel victim.
Leniency recipients do not receive any benefit in the damages litigation context. The Competition Ordinance does not provide exceptions for leniency recipients in relation to liability in competition damages claims.
Nevertheless, the Competition Commission has pledged not to release any confidential information provided to the Commission by a leniency applicant for the purpose of making a leniency application and/or pursuant to a leniency agreement and the Commission’s records of the leniency application process, including the leniency agreement. It has further pledged to firmly resist, on public interest or other applicable grounds, requests for such material in connection with private civil proceedings in Hong Kong or in other jurisdictions.
Under the Competition Commission’s Leniency Policy for Undertakings Engaged in Cartel Conduct (November 2015), the Competition Commission will only comply with requests for such material in limited circumstances, namely if: (a) it is compelled to make a disclosure by an order of the Competition Tribunal or any other court, by law or any requirement made by or under a law; (b) it has the consent of the leniency applicant to disclose the material; (c) the relevant information or document is already in the public domain; or (d) the leniency agreement has been terminated by the Competition Commission.
Leniency recipients do not receive any benefit in damages litigation. Nevertheless, it should be noted that the leniency program has been rarely used in Israel, and therefore, currently the law on this subject is not developed enough and may be developed in the future.
Generally, there is no mechanism to give leniency recipients benefits in competition damages litigation. There are, of course, opinions that such a system should be introduced in order to make leniency more effective but there is no momentum to actually establish such system.
However, in relation to Type B claims, if leniency recipients are exempt from an administrative surcharges order and a cease and desist order, such recipients will not be liable for damages under Type B claims (see Question 2).
Article 6:193m paragraph 4 DCC provides that an immunity recipient shall be jointly and severally liable for the damage resulting from the infringement only vis-à-vis its direct and indirect purchasers and suppliers, unless full compensation for the damage cannot be obtained from the other undertakings participating in the infringement. Furthermore, article 193n DCC provides that the contribution of an immunity recipient, in relation to the other offenders involved in the infringement, to the compensation for the harm suffered by their direct and indirect purchasers and suppliers shall not exceed the compensation for the harm suffered by its direct and indirect purchasers and suppliers, in proportion to the extent to which the circumstances imputable to it have contributed to the harm.
Under Section 35 of the PCA and Section 1 of the Leniency Rules, the PCC may confer immunity from private suit by affected parties as part of its Leniency Program for participants in prohibited anti-competitive agreements.
The leniency recipients are only liable for damage incurred by its direct or indirect suppliers and clients. The liability toward third parties is limited to situations where the entire damage incurred by the claimant cannot be recovered from the other co-infringers.
The Portuguese leniency legal framework is foreseen in Articles 75 to 82 of the Portuguese Competition Law. Under these rules, immunity or reduction of fines may be granted in the administrative proceedings concerning cartel infringements pursuant to Article 9 of the Portuguese Competition Law and, if applicable, pursuant to Article 101 of the TFEU.
Under Portuguese Competition Law, immunity from civil claims is not granted to leniency applicants. However, pursuant to Article 5, paragraph 4 of Law 23/2018, the successful leniency applicants (i.e., applicants that have been awarded with immunity from fines) will only be liable towards their own direct and indirect customers or suppliers, except if the injured parties other than the direct or indirect customers or suppliers do not receive full compensation for damages from the other entities involved in the infringement, in which case the leniency applicants will be subsidiarily liable.
The liable individuals or legal entities may be entitled to an exemption or reduction of the obligation to compensate the claimant, if the leniency programme in chapter VIII of the Competition Law applies. However, an individual or legal entity that used the leniency programme continues to be jointly and severally liable to its direct or indirect purchasers or suppliers, and other damaged parties, if it is impossible to obtain full compensation from the other companies/individuals that were involved in the same violation.
There are limitations concerning what evidence that can be invoked against companies that have been part of a leniency process and their joint and several liability is also limited. As noted above, the term ‘joint and several liability’ means that if several parties are liable for damage caused by them, then a claim can be brought against any of them for the same amount as if that party alone had been liable for the damage (i.e., the whole amount). However, in relation to an undertaking that has been part of a leniency process, the obligation to pay compensation is limited to the loss that it has caused its direct and indirect buyers and suppliers. As regards damage caused to other parties than that undertaking’s direct or indirect buyers or suppliers, its responsibility is limited to an amount corresponding to its share of the damage.
Nothing in the Turkish competition law regime or the civil procedure law provides immunity to leniency applicants/recipients with regards to the potential private damages claims or provides advantages in regard to procedural matters such as the discovery process in litigation. As a general rule, Turkish courts can request documents/information from all public or private bodies including the Turkish Competition Authority. Given the lack of any immunity or special treatment for leniency documents, the Turkish Competition Authority would be bound by law to provide the requested evidence to the court where they fall within the scope of the discovery request.
No. The ACCC offers immunity and leniency to parties in relation to criminal prosecution, enforcement actions and proceedings brought by the ACCC. However, the ACCC cannot grant a party immunity from private actions for damages under the CCA.
Further, any immunity or leniency recipient is not entitled to withhold evidence that was disclosed in the immunity application process in any subsequent claim for damages. The ACCC accepts oral applications under the Immunity Policy and will, to the extent possible, ensure that written records of oral applications do not prejudice the immunity / leniency applicant.
As explained above in question 4, leniency recipients do not receive any benefit in the damages litigation context.
See answer 4.
Yes. Broadly, leniency recipients benefit from more favourable terms as regards the joint and several liability (see question 4). Also, documents drafted in the context of leniency proceedings have a special disclosure regime in the context of competition damages claims (see question 21).
Historically, a successful leniency application provided no protection from civil claims for damages brought by victims of the infringement.
However, following the implementation of the Damages Directive, some limitations on the liability of immunity recipients have been imposed. Immunity recipients will generally only be liable for the harm caused to their direct and indirect purchasers, but will not be jointly and severally liable for the entire harm caused by the infringement (except where the remaining ‘co-infringers’ are unable to fully compensate the other victims of the infringement). As such, they will also generally be protected from contribution claims from co-infringers. However, this protection only extends to immunity recipients and they are likely to have to wait several years to determine the full extent of their liability. This protection only applies in the context of proceedings commenced on or after 9 March 2017, where the relevant infringement and harm also occurred on or after that date.
Neither in individual or collective actions, leniency recipients receive any benefit. These actions have a compensatory purpose and, according to Colombian law, the victims right for compensation cannot be negotiated or affected by the leniency of the liable entity.
The leniency policy in Colombia, only applies for the administrative investigations before the Superintendence of Industry and Commerce as competition authority in Colombia.
Individuals and companies can enter the DOJ’s antitrust leniency program by being the first to self-report a criminal antitrust violation and fully cooperating with the DOJ investigation. By doing so, leniency applicants can be exempted under ACPERA from the treble damages and joint and several liability which otherwise applies in private antitrust litigation.
According to Section 213 of ACPERA, an antitrust leniency applicant or cooperating individual satisfies the eligibility requirements for leniency with respect to a civil action if the court determines that the applicant or cooperating individual has cooperated satisfactorily. This cooperation entails:
- providing a full account to the claimant of all facts known to the applicant or cooperating individual that are potentially relevant to the civil action;
- furnishing all documents or other items potentially relevant to the civil action that are in the possession, custody, or control of the applicant or cooperating individual, as the case may be, wherever they are located;
- in the case of a cooperating individual, making himself or herself available for such interviews, depositions, or testimony in connection with the civil action as the claimant may reasonably require; and responding completely and truthfully, without making any attempt either falsely to protect or falsely to implicate any person or entity, and without intentionally withholding any potentially relevant information, to all questions asked by the claimant in interviews, depositions, trials, or any other court proceedings in connection with the civil action; or
- in the case of an entity, using best efforts to secure and facilitate from cooperating individuals covered by the agreement the cooperation described above.