Interface Between Leniency and Settlements in European Commission proceedings

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European Competition DayBrno, Czech Republic13
May 2009
Interface Between Leniency and Settlements in
European Commission proceedings
Sari Suurnäkki, Deputy Head of Unit,Cartels
Directorate, European Commission
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Roadmap for making fight against cartels more
effective

• Creation of Cartel Directorate
• Improved investigating techniques
• Improving the leniency programme and establishing
  a coherent system of leniency within
  jurisdictions that apply Article 81 EC
• Revised guidelines on fines
• Introduce a settlement system

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Leniency Programme key elements

• A tool to uncover and put an end to cartels
• Immunity for the first one
• Important reductions for subsequent applicants
  that make decisive contribution to the
  investigation
• significant added value
• race between applicants
• fixed bands, up to 50 reduction

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Leniency programme in practice

• Increase in number of cartel cases decided
• 1990-1994 11
• 1995-1999 10
• 2000-2004 33
• 2005-2008 28 (on average 7 per year)
• Substantial reductions in fines
• E.g. in the car glass case Asahi got 50
  reduction which reduced its fine by 113 500 000 .

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Settlements in cartel cases why?

• For us, the fundamental driver of the
  settlements package is the need to maximise
  efficiency in order to improve enforcement.
• Settlements are an option for companies which,
  in full knowledge of the strength of the
  Commission case and having been able to argue
  their case, prefer to admit liability and qualify
  for a reduction in the fine.
• (Neelie Kroes, Fiesole, 19 September 2008)

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Incentives to settle

• During the settlement discussion companies will
  be able to express their views on
• Commission objections and evidence
• Factors to be taken into account for fines
  calculation
• Companies will also benefit from
• shorter procedure
• reduction of fine
• Publicity aspect

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Cartel fines pre and post appeals
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Settlement procedure key elements

• Full investigation
• Exploring the parties interest to settle
• Bilateral settlement discussions
• Company admits liability in a settlement
  submission and states a maximum for a fine
• Shorter Statement of Objections and Decision in a
  quicker timeframe

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Combined outcome increased deterrence and
effectiveness

• More efficient handling of cases
• More cartel investigations/decisions
• Focus on new cases
• ? Higher probability of being detected