The EU and German leniency guidelines - A comparative look
In recent years, competition authorities in Europe, such as the European Commission (EC) and the German Federal Cartel Office (FCO), have notably increased their activities in pursuing potential antitrust violations, in particular cartels. Both authorities have thereby made extensive use of their powers to impose fines for antitrust violations. Most recently, the EC imposed a record fine totalling €990 million on participants of an elevator cartel and the FCO imposed a fine totalling €208 million on suppliers of liquefied gas.
It is obvious that such high fines, which can reach up to 10% of a company’s worldwide turnover under both systems, have an intimidating effect on companies. Companies involved in illegal cartels that are willing to end their involvement may thus be dissuaded from coming forward unless they get something in return. The EC and the FCO – as well as 24 other competition authorities within the European Union (EU)1 – have therefore introduced leniency programs. These foresee that leniency applicants can obtain a reduction of, or immunity from, fines that would otherwise be imposed on them as members of the cartel, if they provide information to the authorities that significantly help them with the cartel investigation. Having found that their previous systems had room for improvement, both the EC and the FCO issued new leniency guidelines in 2006.
This report reviews the new EC and FCO guidelines and discusses the main differences of the two systems.
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