What level of leniency, if any, is available to subsequent applicants and what are the eligibility conditions?
The rules explained in Question 3.1 apply to subsequent cooperating parties as well. Also, the Board may consider the parties’ active cooperation after the immunity application as a mitigating factor as per the provisions of the Regulation on Fines.
The second undertaking to file an appropriately prepared application would receive a fine reduction of between 33 and 50 per cent. Employees or managers of the second applicant that actively cooperate with the Authority would benefit from a reduction of between 33 and 100 per cent.
The third applicant would receive a 25 per cent to 33 per cent reduction. Employees or managers of the third applicant that actively cooperate with the Authority would benefit from a reduction of 25 per cent up to 100 per cent.
Subsequent applicants would receive a 16 per cent to 25 per cent reduction. Employees or managers of subsequent applicants would benefit from a reduction of 16 per cent up to 100 per cent.
Parties not eligible for “first in” immunity may seek to cooperate with the ACCC. However, there are no pre-determined discount levels or ranges that apply. It is a matter for the Courts to determine the appropriate penalty or fine, having regard to the extent of any discount for cooperation. The ACCC or CDPP will set out in submissions to the Court any cooperation provided by a party and their assessment of the extent and value of the cooperation.
The Immunity Policy sets out the factors the ACCC/CDPP will consider in assessing the cooperation of a party, such as whether the party approached the ACCC in a timely manner (civil) and whether the party has pleaded guilty (criminal). The ACCC or CDPP may also require the cooperating party to make admissions, agree to a statement of facts, and/or provide evidence in proceedings.
After the leniency agreement has been executed, it is no longer available for the same reported conduct. The other representatives that are interested in negotiating an agreement should propose the so-called Cease and Desist Commitment (TCC), which is another type of settlement, as further detailed below.
According to Article 15 of the Competition Act, an undertaking that is first to provide the FCCA with information and evidence significant for the clarification of the infringement, its extent or nature, will obtain a fine reduction of 30 percent to 50 percent, the second applicant will obtain a reduction of 20 percent to 30 percent and other applicants fulfilling the criteria would see their fines reduced by a maximum of 20 percent.
The grant of a reduction of fines is additionally conditional upon the conditions laid out in the previous section regarding the conditions for full immunity.
The Leniency Program is available to subsequent applicants that self-report an offence under the Act. The Commissioner will recommend the granting of leniency in sentencing only where the applicant has terminated its participation in the cartel, has agreed to cooperate fully and in a timely manner, demonstrates that it was a party to the offence, and agrees to plead guilty.
The process is similar to immunity: marker, followed by proffer. The Bureau then makes a recommendation to the PPSC as to the terms of a plea agreement and the amount of the fine to be imposed. The PPSC enters into a plea agreement with the leniency applicant and full disclosure then needs to be completed within 6 months. Once full disclosure is completed, the leniency applicant will plead guilty and the PPSC will present, jointly with the applicant, a recommended sentence. While courts have the exclusive authority to decide the appropriate sentence, trial judges should only depart from a joint submission in very limited circumstances (see R. v Anthony‑Cook, 2016 SCC 43).
The current program allows all leniency applicants to benefit from a fine reduction of up to 50%, based on the timing of the application and the value of the party’s co-operation. The fine calculation is discussed in section 18 below.
In line with Bureau’s Corporate Compliance Programs Bulletin, an effective compliance program will be treated as a mitigating factor.
According to the former standards of NDRC, for the undertaking with the second proactive report on the relevant situation of the monopoly agreement and who provides important evidence, the penalty may be mitigated by more than 50%; for other active reporter who provides the relevant situation of the monopoly agreement and provides important evidence, the penalty can be reduced by no more than 50%. Meanwhile, undertakings have to cooperate with the investigating authority comprehensively and proactively.
Leniency is available only to the first party to qualify. There is no formal leniency programme for other cooperating parties. However, judges may consider a company’s cooperation as a mitigating factor for sentencing, and the DOJ may treat later-cooperating parties with more leniency in its investigations or plea bargaining, which may result in a reduced sentence or fine.
Please refer to 3.1.
The amount of a reduction given will depend generally on the stage of the investigation, the nature and the ‘value-added’ of the information and other co-operation to be provided by the applicant which has already been received by the MyCC. In other words, the MyCC may take into consideration any circumstances including the time the enterprise came forward to the MyCC about an infringement, the stage in the investigation, if any, the information or other form of co-operation to be provided and the information already in possession of the MyCC.
In order to get partial immunity the company has to notify its participation in a restriction of competition and to cooperate unsolicited in the proceedings.
The sanction may be reduced by up to 50% depending on the importance of the undertaking's contribution to the success of the proceedings.
An eligible candidate with whom an immunity agreement has been signed in accordance with the terms of the Program is completely immune from initiating criminal proceedings by the Competition Authority against him. The granting of immunity constitutes a commitment of the prosecution authorities in Israel to the immune entity, according to which the prosecution authorities undertake not to initiate criminal proceedings against it. It should be noted that the Program does not grant any immunity from civil enforcement. For example, the Competition Commissioner's decision regarding the GIS cartel was based, almost exclusively, on testimonies received from employees of ABB, which received immunity from criminal prosecution in Israel. However, the company was sued, on the basis of the above decision, in a civil suit by the IEC, as well as in a class action.
Only the first undertaking to provide the CNMC with sufficient information to establish the existence of a cartel or to enable an inspection is eligible for full immunity. Moreover, applicants which have coerced other undertakings into joining the cartel, i.e. ringleaders, are not eligible for full immunity from fines either, but only for reductions of fines. Nonetheless, applicants which have just implemented the cartel scheme, for instance, by inviting other undertakings to join, coordinating the functioning or even assuming the leadership, can still qualify for full immunity.
The second applicant, or the first applicant if the inspection has already been conducted or it is considered to be a ringleader, may still benefit from a reduction of between 30% and 50% of the fine, provided that their application adds significant value. Evidence is deemed to add significant value where it makes a conclusive contribution to the investigation as compared to the information already in the competition authority’s possession, and makes it significantly easier to prove the existence and scope of the cartel or extends the duration or scope of the investigated conduct.
The extent of the reduction available for further applicants depends on the order of receipt of the applications. However, if an applicant does not contribute significant added value, its position remains open for subsequent submissions. In particular, the third applicant may benefit from a reduction ranging from 20% to 30% of the fine, while all subsequent applicants may obtain a reduction of up to 20%. The Spanish leniency programme does not provide for additional benefits for leniency applicants.
Full immunity as a consequence of a leniency application is conditional upon being the first either to bring an anticompetitive deed to the attention of the CC or to offer the CC the necessary proof to establish that an infringement occurred. The Leniency Guidelines provide that in the case in which leniency applicant do not qualify for either Type A or Type B Immunity, they nevertheless may qualify for a reduction of the fine that would have normally been applied thereto by the CC. The sole condition is that their application make a "substantial supplementary contribution" to the overall elements of proof held by the CC.
This reduction is granted on a first-come first-served basis. Thus, the first applicant will benefit from a reduction of the fine between 30%-50%, the second between 20%-30%, while all the other will benefit from a maximum 20% reduction.
Subsequent undertakings that provide evidence of cartel activity before a statement of objections is issued may be eligible for ‘Type C leniency’, which usually results in a reduction of 25 to 50 per cent. of the financial penalty that would otherwise have been imposed. The CMA is entitled to exercise its discretion in awarding immunity from criminal prosecution for specific individuals. Cooperating individuals should also avoid director disqualification.
For an undertaking to be eligible for Type C leniency, it must satisfy the conditions set out at (i)-(iv) in response to question 3.1 above.
Applicants that are not ‘first through the door’ or do not meet the cumulative criteria for full immunity may still obtain a reduction in fines. Leniency is available if the applicant provides evidence which the Commission believes adds significant value, relative to what is already in the Commission’s possession. The reduction in the level of fines depends, among other things, on applicant’s order in the ‘queue’: between 30 and 50 per cent. for the first applicant; between 20 and 30 per cent. for the second; and between 0 and 20 per cent. for any subsequent applicants.
Parties that are not the first to apply for the leniency programme may request a reduction of the sanctions, if they are able to meet the remaining requirements and provide the antitrust authority with useful information for the investigation. The reduction may range from 20% to 50% of the sanction. The reduction ratios are to be determined by the Antitrust Commission by taking into account the chronological order of the filing.
The Antitrust Law also includes a ‘leniency plus’ provision, by means of which those parties that would not be able to request an exemption regarding anticompetitive conduct, but that could provide information on a second instance of anticompetitive conduct, can obtain an exemption on the latter, and a one-third reduction in the former. Additionally, the Antitrust Law specifically sets out that there cannot be a joint enforcement by two parties of the leniency programme, the sole exception being if a company and its directors or other members of its staff request the enforcement of the leniency programme.
If subsequent applicants assist with the evidence that represents “significant added value”, a partial leniency may be granted. A reduction of 30-50% is granted to the first applicant that fulfils this condition. The second applicant is granted a 20-30% reduction, while subsequent applicants is granted a reduction of up to 20%.
When determining the reduction to be granted, it is of relevance how early the evidence was provided, the nature and strength of the evidence and to what extent the undertaking has cooperated with the authorities.
Subsequent applicants can be granted a reduction of the fines if they offer evidence of significant added value compared to the evidence the BCA already had in its possession. In addition, the undertakings must comply with the collaboration requirements. These applicants are called Type 2 applicants.
The first Type 2 applicant will get a reduction ranging between 30 and 50%, the second applicant’s reduction will be between 20 and 40%, and the third and following applicants’ reduction will be between 10 and 30%.
Important to note is that any aggravating evidence resulting in a longer duration or more serious infringement will not be used in the calculation of the ultimate amount of the fine for the applicant that adduced that particular evidence.
As already, mentioned, both full and partial leniency are provided under the leniency programme. In order to qualify for partial immunity (‘Type 2’) the undertaking concerned shall not be the first to submit information; however, it must provide the HCC with evidence that has an added value with respect to the evidence already possessed by the HCC. The requirements listed above under question 3.1 must also be met in the case of partial immunity. Note that for the second undertaking to meet the aforementioned criterion, a reduction of 20 per cent to 30 per cent is applied. Finally, for the subsequent undertakings that meet aforementioned criterion, a reduction of up to 20 per cent shall be granted.
The second applicant can obtain a reduction up to 50% and the third and any subsequent applicants may get a reduction of up to 30%, if the applicants provided significant added value (i.e., they provided evidence which enhanced the ability of the CCI/DG, to establish the existence of a cartel). The second and the subsequent applicants are also required to satisfy the conditions provided in clause (b) to (d) in response to query 3.1 above.
Immunity (full leniency) can only apply to the first applicant that fulfils the conditions provided in section 3.1 above.
Other companies may be granted a reduction of fine if they significantly facilitate the investigation by voluntarily providing the SCA with all the information on the infringement at its disposal and by actively cooperating with the SCA. The information must have a significant value compared to the information that the SCA already has. Once the SCA has initiated an on-site inspection (i.e. dawn raid), the SCA is considered to have access to all the evidence that will be encountered during the inspection.
The first company fulfilling the conditions for reduction of fines will be granted a 30–50 per cent reduction of fine. The fines of the second company fulfilling these conditions can be reduced by 20–30 per cent. The fines of other companies subsequently fulfilling the relevant conditions can be reduced by up to 20 per cent.
In order to determine the exact reduction level within the stated intervals, the SCA takes into consideration e.g. at what point in time the evidence was submitted, the degree to which value was added and the continued cooperation by the company concerned.
According to Regulation 16 of the Leniency Programme, in order for an undertaking to meet the relevant conditions for the reduction of an administrative fine that would have been otherwise imposed, it must provide the CPC with evidence of the alleged infringement which represent significant added value with respect to the evidence already in the Commission's possession and must meet the cumulative conditions set out in Regulation 5. There is a scale applied for the leniency provided to the subsequent applicants, particularly (i) for the first undertaking which complies with Regulation 16: a reduction of 30-50%, (ii) for the second undertaking which complies with Regulation 16: a reduction of 20-30%, (iii) for subsequent undertakings which comply with Regulation 16: a reduction of up to 20%.
As outlined in 4.1 above, there is no special Leniency programme available in relation to the violations of the UAE Competition Law.