Immunity & Sanctions

Last verified on Sunday 24th May 2020

Immunity & Sanctions: European Union

Alexander Israel, Beatriz Mejia and Jan Lang

Cooley LLP

Immunity or a 100 per cent reduction in sanctions

1. What benefits are available to the first applicant to qualify?

European Union

The first applicant to qualify will receive full immunity from antitrust fines (ie, a 100 per cent reduction of the fine), which would have otherwise been imposed. Additionally, it will also benefit from a privileged position with regard to private follow-on damage claims based on the cartel. The European Directive 2014/104/EU (EU Damages Directive) stipulates that the immunity applicant shall only be fully liable for its own direct or indirect purchasers or providers; to other injured parties the immunity applicant will remain fully liable only where full compensation cannot be obtained from the other undertakings that were involved in the same infringement of competition law.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

2. Do the protections extend to current and former officers, directors and employees?

European Union

EU law does not impose sanctions on current and former officers, directors and employees. The immunity thus does not extend to them. See also the response to question 42.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

3. Is immunity available after an investigation begins?

European Union

Yes, immunity is available after an investigation begins. The relevant threshold to be met in this case is detailed in the response to question 5.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

4. What are the eligibility requirements before an investigation begins?

European Union

The applicant needs to disclose its participation in the alleged cartel and be the first to submit information and evidence, which in the Commission's view will enable it to carry out a targeted inspection in connection with the alleged cartel or to find an infringement of article 101 TFEU in connection with the alleged cartel. Immunity for an applicant that only provides sufficient evidence to enable a targeted inspection is no longer available if, at the time of the submission, the Commission had already sufficient evidence to adopt a decision to carry out an inspection in connection with the alleged cartel or had already carried out such an inspection.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

5. What are the eligibility requirements after an investigation begins?

European Union

The applicant needs to disclose its participation in the alleged cartel and be the first to submit information and evidence that in the Commission's view will enable it to find an infringement of article 101 TFEU in connection with the alleged cartel. Immunity is no longer available, however, if it has already been granted to another applicant that has provided evidence that enabled the Commission to carry out a targeted inspection or if the Commission already had sufficient evidence by other means to find an infringement of article 101 TFEU.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

6. Will the applicant have to admit to a violation of law?

European Union

While the applicant is not explicitly required to admit to a violation of law, it has to provide a wide range of information in relation to the cartel. The applicant will have to disclose its participation in the alleged cartel and provide:

a detailed description of the alleged cartel arrangement, including, for instance its aims, activities and functioning; the product or service concerned, the geographic scope, the duration of and the estimated market volumes affected by the alleged cartel; the specific dates, locations, content of and participants in alleged cartel contacts, and all relevant explanations in connection with the pieces of evidence provided in support of the application.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

7. Is immunity available to an applicant that admits exchanging commercially sensitive information with a competitor but does not admit entering into an agreement to fix prices or allocate markets?

European Union

Immunity is available for all types of cartels. If the information exchange itself infringes article 101 TFEU, it is likely to be treated as a cartel under EU competition law and immunity is available. Exchanges of information can infringe article 101 TFEU where they enable undertakings to be aware of the market strategies of their competitors.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

8. Is immunity available to an applicant that admits entering into a vertical price-fixing agreement if that agreement does not also include horizontal collusion?

European Union

The Commission’s leniency notice is only applicable to horizontal conduct (ie, cartels with competitors). However, the Commission has previously granted fine reductions for cooperation in vertical cases and issued a Fact Sheet outlining the type of cooperation that can be provided during an investigation into vertical conduct.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

9. Is immunity available to an applicant that admits entering into an agreement not to solicit or hire another company's employees ("no-poach" agreements)?

European Union

Immunity is available for all types of cartels. As “no-poach” agreements can constitute a cartel under EU competition law, immunity is available.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

10. Are ringleaders or initiators of the conduct eligible?

European Union

Yes, ringleaders or initiators of the anticompetitive behaviour are, in principle, eligible for immunity. However, the leniency notice excludes companies from the immunity benefits if they coerced other undertakings to join the cartel or to remain in it.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

11. When must the applicant terminate its involvement in the conduct?

European Union

In accordance with the Commission’s leniency notice, the undertaking must end its involvement in the alleged cartel immediately following its application for immunity, except for what would, in the Commission's view, be reasonably necessary to preserve the integrity of the inspections. The applicant may then be required to continue its participation in the alleged cartel for a significant period of time.  

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

12. What constitutes termination of the conduct?

European Union

There is no clear definition of what constitutes termination of the alleged cartel activity. If parties were participating in anticompetitive meetings, public distancing (ie, publicly manifest disapproval for the cartel practice and avoid further meetings) is required. However, in case C‑634/13 P, Total Marketing Services SA v Commission, the European Court of Justice has clarified that EU competition law does not require in all circumstances such a distancing to put an end to participation in the infringement. In cases where the infringement takes place over several years and where the undertaking did not participate in anticompetitive meetings for a certain period of time, the absence of public distancing constitutes only one factor among others to take into consideration when assessing whether the conduct has ended.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

13. Will the applicant be required to make restitution to victims?

European Union

The EU Damages Directive foresees that injured parties can claim damages from the cartel members. However, restitution is subject to civil law proceedings in the respective EU member state and its laws and not within the scope of the Commission’s investigation. According to the EU Damages Directive, the immunity applicant shall only be fully liable to its own direct or indirect purchasers or providers; to other injured parties the immunity applicant will remain fully liable only where full compensation cannot be obtained from the other undertakings that were involved in the same infringement of competition law.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

14. Can more than one applicant qualify for immunity?

European Union

No, only one applicant can qualify for immunity. Nonetheless, if subsequent applicants provide compelling evidence which the Commission uses to establish additional facts increasing the gravity or the duration of the infringement, the Commission will not take such additional facts into account when setting any fine to be imposed on the undertaking which provided this evidence.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

15. Can an applicant qualify if one of its employees reports the conduct to the authority first?

European Union

If an employee reports the conduct to the authority first, the applicant can be precluded from qualifying as the Commission may already be in a position to carry out a targeted inspection or to find an infringement. An employee’s report is not be considered to have been submitted on behalf of its employer.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

16. Does the afforded protection extend to any non-antitrust infringements?

European Union

No. The Commission is only competent for antitrust infringements. The protection does not extend to other proceedings by other authorities.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

Immunity application and marker process

17. What confidentiality assurances are given to the first applicant to report?

European Union

The Commission only grants access to the applicant’s reports – which can be submitted orally or via e-leniency, an online tool that does not keep records on the applicant’s device – to addressees of a Statement of Objections (ie, to other (suspected) parties to the infringement).

Additionally, if during the administrative proceedings, immunity is no longer available or the application does not meet the thresholds for receiving immunity, the Commission has to inform the applicant in writing. The applicant may retract its application and all the materials submitted. The Commission cannot use the withdrawn information, but it may decide to continue the proceedings by means of its normal investigative powers.

The EU Damages Directive also states that national courts cannot at any time order a party or a third party (including the Commission) to disclose leniency statements. The European Court of Justice has also found a general presumption that documents within the Commission’s file of a cartel investigation are confidential and thus regularly do not fall within the scope of disclosure requirements under the EU’s Transparency Regulation 1049/2001.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

18. Does the authority publish guidance regarding the application of the programme?

European Union

 Yes, the Commission has published the following guidance:

Another useful document intended as internal guidance for the Commission’s handlers that contains valuable information and practical insights in the procedure is the Antitrust Manual of Procedure, available on the Commission website.

Useful information in relation to access to the Commission’s file as well as regarding confidentiality claims may be found:

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

19. Do the rules for obtaining immunity in your jurisdiction conflict with the immunity rules in other jurisdictions?

European Union

No.

To reduce the administrative burden on potential applicants, the European Competition Network (ECN) adopted the Model Leniency Programme aiming at harmonising the leniency systems in the European Union. The Model Leniency Programme suggested that, following the submission of an immunity application, an undertaking could simply file a “summary application” to any national authority that may be involved in the proceedings.

However, in case C‑428/14, DHL Express (Italy) and DHL Global Forwarding (Italy) v AGCM, the European Court of Justice held that instruments adopted by the ECN, in particular the Model Leniency Programme, are not binding on competition authorities and that there is no legal link between immunity applications filed before the Commission and summary applications lodged before national regulators regarding the same conduct. As such, national authorities are not required under EU law to assess a summary application in light of the one presented to the Commission. In this case, the application to the Commission was wider than the one to the Italian Authority. Ultimately, the Commission decided to investigate only part of the conduct and the immunity applicant with the Commission was fined for conduct in a sector that it failed to disclose in its summary application in Italy.

The recent ECN+ Directive aims at increasing legal certainty in relation to national leniency programmes, reducing discrepancies between member states and setting out a common framework for national competition authorities. Chapter V of the ECN+ Directive defines the concepts of immunity and reduction of fines as well as the conditions to apply for such benefits, the forms of leniency statements and the marker system. Article 22 of the ECN+ Directive determines how summary applications should be treated by national competition authorities. In particular, it ensures that applicants are given the opportunity to submit full applications to national competition authorities, once the Commission has decided to not pursue the case, in whole or in part. 

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

20. What is the initial process for making an application?

European Union

Applicants will reach out to the Commission’s dedicated leniency team via telephone or email to inquire if immunity is still available for a certain conduct and, if so, make an appointment for a marker (ie, a short statement or report detailing the most relevant information), or a formal application, namely, a full submission substantiated by all the evidence required under the Commission's leniency notice to qualify for immunity. At this stage, an informal meeting may also take place. After the marker or formal application is submitted, the Commission will assess whether immunity is still available. If necessary, it will set a deadline for the applicant to complete the marker.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

21. What information is required to secure a marker?

European Union

The applicant must provide the Commission its name and address, the parties to the alleged cartel, the affected product(s) and territory (-ies), the estimated duration of the alleged cartel and the nature of the alleged cartel conduct. The applicant should also inform the Commission of other past or possible future leniency applications to other authorities, inside or outside the EU, in relation to the alleged cartel and justify its request for a marker (ie, why the applicant cannot proceed immediately with a formal application).

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

22. How much time will an applicant have to perfect its marker?

European Union

There is no pre-described time limit to perfect the marker. The limit is determined by the Commission on a case–by-case basis and ranges from a few days to several weeks.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

23. Can the deadline for perfecting the marker be extended?

European Union

The applicant may ask for an extension of the deadline to perfect the marker by submitting a formal request. The request should be thoroughly explained. The Commission assesses the request on a case-by-case basis.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

24. What is required to perfect the marker?

European Union

The perfection of the marker occurs by submitting the information and evidence required for a formal immunity application within the deadline. In case the undertaking perfects the marker within this period, it will be considered that the information and evidence have been submitted on the day the marker was granted.

A formal application for immunity consists of (i) a corporate statement, and (ii) other evidence regarding the cartel at the applicant’s disposal (in particular, evidence contemporaneous to the infringement).

According to the Commission’s leniency notice, the corporate statement must contain:

  • a detailed description of the alleged cartel arrangement, including  its aims, activities and functioning;
  • the product or service concerned, the geographic scope, the duration of and the estimated market volumes affected by the alleged cartel;
  • the specific dates, locations, content of and participants in alleged cartel contacts, and all relevant explanations in connection with the pieces of evidence provided in support of the application;
  • the name and address of the legal entity submitting the immunity application as well as the names and addresses of all the other undertakings that participate(d) in the alleged cartel;
  • the names, positions, office locations and, where necessary, home addresses of all individuals who, to the applicant's knowledge, are or have been involved in the alleged cartel, including those individuals who have been involved on the applicant's behalf; or
  • information on which other competition authorities, inside or outside the EU, have been approached or are intended to be approached in relation to the alleged cartel.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

25. Can the scope of the marker be expanded if additional information is discovered by the applicant?

European Union

The scope for which the marker was granted is based on the description of the cartel provided by the applicant. If the applicant discovers additional information revealing further wrongdoings in the context of the same conduct, it may apply for an expansion of the scope of the marker. If it is the first company to disclose the additional aspects, the marker can be expanded.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

Immunity cooperation obligations

26. Can an applicant lose its marker if a second applicant comes forward with better information?

European Union

No, the Commission has stated that it will not consider other applications for immunity from fines before it has taken a position on an existing application. If the first application thus meets the eligibility thresholds of enabling a dawn raid or enabling the Commission to find an infringement, a second applicant – even with better information – cannot benefit from full immunity.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

27. What if the applicant’s investigation reveals that no violation exists?

European Union

Given the voluntary character of leniency applications, the applicant may withdraw its application if it does not consider it suitable to meet the eligibility requirements of the Commission’s leniency notice (namely, it does not enable the Commission to carry out an inspection or to establish an infringement of article 101 TFEU).

The Commission cannot use the withdrawn information, but it may decide to continue the proceedings by means of its normal investigative powers.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

28. What if the authority decides not to investigate?

European Union

If the application manifestly lacks substance or provides non-corroborated and vague information on the cartel, the Commission may decide to issue a “no-action” letter. The “no-action” letter indicates that the Commission is not willing to prosecute the case further but it may change its stance at a later stage and, in that circumstance, it will adopt a position on the application. The applicant’s interests are therefore protected should the Commission restart the investigation. The ‘no-action’ letter differs from a decision rejecting conditional immunity as in the latter case the Commission may continue the proceeding and simply inform the applicant that immunity is not available as it has already been granted or that its application does not meet the relevant threshold.

The Commission may also issue a “non-processing letter”, announcing that it will not process the application, when a national competition authority has received a parallel one for a case having a national scope and it intends to investigate it.

Additionally, in case the application does not report a conduct covered by the Commission’s leniency notice (for instance, it refers to a vertical commercial agreement rather than to a cartel), the Commission may issue a “non-eligibility” letter, informing the applicant that it is not eligible for immunity.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

29. What is the applicant required to produce?

European Union

As explained in response to question 24, the applicant is required to produce (i) a corporate statement, and (ii) other evidence regarding the cartel at the applicant’s disposal (in particular, evidence contemporaneous to the infringement).

The Commission’s leniency notice also prescribes that the applicant must cooperate genuinely, fully, on a continuous basis and expeditiously from the time it submits its application throughout the entire Commission's administrative procedure (‘duty of genuine cooperation’). This means that it must:

  • provide the Commission with all relevant information and evidence relating to the alleged cartel that comes into its possession or is available to it;
  • remain at the Commission’s disposal to answer promptly to any request that may contribute to the establishment of the facts;
  • make current (and, if possible, former) employees and directors available for interviews with the Commission;
  • not conceal, falsify or destroy relevant information or evidence in relation to the alleged cartel as well as not disclose the fact or content of its application prior to a Statement of Objections (unless differently agreed).

Additionally, immediately following the application, the undertaking must end its involvement in the cartel, except for what would, in the Commission's view, be reasonably necessary to preserve the integrity of the inspections.

The Commission’s leniency notice, furthermore, requires that the undertaking, when contemplating to make the application, must not have destroyed, falsified or concealed evidence of the alleged cartel nor disclosed the fact or any of the content of its contemplated application, except to other competition authorities.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

30. Will the applicant be required to make a written confession?

European Union

As specified in response to question 6, there is no requirement for the applicant to explicitly admit to a violation of the law. The applicant can produce all information either by means of an oral statement or through the Commission’s e-leniency tool.

Oral statements are recorded and transcribed at the Commission's premises. Undertakings submitting oral statements have the obligation within a given time limit to (i) check the technical accuracy of the recording, and (ii) to correct the substance of their oral statement. Non-compliance with this requirement may lead to the loss of any beneficial treatment under the Commission’s leniency notice.

The Commission accepts oral statements only if the applicant has not already disclosed the content of the corporate statement to third parties.

At the time of writing, the oral statement proceeding is currently suspended due to covid-19 lockdown in Belgium.

The e-leniency tool allows applicants to electronically file submissions to the Commission. The Commission guarantees that the system provides the same level of protection in terms of confidentiality and legal protection as the traditional oral procedure, since data is transferred securely and cannot be copied. Submissions cannot be saved and they have to be typed in one go. For long documents, the Commission also accepts fragmented statements with proper referencing. Once submitted, the statement is accessible only to the Commission.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

31. Can third parties obtain access to the materials provided by the applicant?

European Union

In the context of cartel proceedings, following notification of the Commission’s Statement of Objections, all addressees (ie, other cartel participants subject to the EC’s investigation) have the right to access the Commission’s case file, namely all documents on which the Commission has built its investigation, including the leniency application.

Access to the file is only granted to the addressees of a Statement of Objections on the condition that the information thereby obtained is used for the purposes of EU competition law judicial or administrative proceedings.

Addressees cannot access (i) internal documents from the Commission or National Competition Authority as well as the correspondence between the two, and (ii) confidential information, comprising business secrets and other confidential information.

Corporate statements are made available to the addressees only at the Commission’s premises and no copy, either by mechanical or electronic means, is allowed. This protection ceases, if and when the applicant reveals the content to third parties. As explained in response to question 17, in general, the Commission does not accept confidentiality claims regarding oral corporate statements. Some information reported in the leniency application may be published in the Commission’s infringement decision. The European Court of Justice has also clarified in case C‑162/15 P, Evonik Degussa GmbH vs. Commission that the Commission may not quote verbatim from the statements. However, it is permitted to quote the content of documents supporting statements, conditionally upon compliance with confidentiality rules.

According to article 11(6) of the EU Damages Directive “leniency statements” are excluded from the disclosure obligation in civil proceedings. Leniency statements are defined in a broad way as “an oral or written presentation voluntarily provided by, or on behalf of, an undertaking or a natural person to a competition authority or a record thereof, describing the knowledge of that undertaking or natural person of a cartel and describing its role therein”. Such documents need to “be drawn up specifically for submission to the competition authority with a view to obtaining immunity or a reduction of fines under a leniency programme, not including pre-existing information”.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

Granting immunity

32. Will the applicant lose its protection if one or more of its employees refuses to cooperate?

European Union

According to the Commission’s leniency notice, the applicant has a duty of continuous, genuine and full cooperation with the Commission, which includes “making current (and, if possible, former) employees and directors available for interviews with the Commission”. In this sense, the applicant must put in place all necessary measures to secure its employees’ collaboration, for instance by providing them reassurance that the cooperation will not lead to disciplinary action.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

33. Will the applicant lose its protection if one of its employees engages in obstructive conduct before or after the application?

European Union

According to the Commission’s leniency notice, the applicant “must not have destroyed, falsified or concealed evidence of the alleged cartel nor disclosed the fact or any of the content of its contemplated application”. This duty already applies when contemplating whether to make an application.

The applicant may also not disclose “the fact or any of the content of its application before the Commission has issued a Statement of Objections”.

For instance, if an employee adopts obstructive behaviours by destroying materials relevant to enable a Commission’s inspection, this may be deemed in violation of the applicant’s cooperation obligations and can result in a loss of the leniency protection.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

34. Will the applicant be required to provide materials protected by attorney-client privilege or work-product doctrine?

European Union

In general, according to the EU Court’s case-law, the following type of materials may be protected under the legal privilege rules:

  • legal advice from external, EEA-qualified lawyers,
  • internal documents confined to reporting the text or content of such legal advice, and
  • internal documents that have been prepared exclusively for the purpose of seeking legal advice from external, EEA-qualified in the exercise of a right of defence.
  • Undertakings are not required to provide these materials to the Commission. Communications with in-house lawyers do not benefit from legal privilege.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

Individual immunity or leniency

35. Does the existence of an effective compliance programme affect whether an applicant meets the eligibility requirements?

European Union

Under EU rules, the existence of an effective compliance programme does not affect whether an applicant meets the eligibility requirement for leniency.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

36. Does the authority consider the existence of an effective compliance programme at the time it becomes aware of an infringement when determining the leniency benefits granted?

European Union

See question 35. The existence of a compliance programme is not considered a mitigating circumstance regarding fines as confirmed by the European Court of Justice in case C-189/02 P Dansk Røhrindustri and others v Commission and by the General Court in case T- 406/09 Donau-Chemie v Commission. The former Commissioner for Competition, Joaquín Almunia has stated that he does not see why the EC “should […] reward a compliance programme that has failed?”

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

37. Will the applicant be required to implement or enhance a compliance programme to obtain leniency benefits?

European Union

No. The cooperation obligations only extend to support with reporting the past conduct. Applicants are not required to implement or enhance a compliance programme to obtain leniency benefits.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

38. How does the authority announce its promise not to charge or sanction?

European Union

Once the leniency application has been submitted, the Commission will assess whether it fulfils the eligibility requirements (namely, enable the Commission to carry out an inspection or to establish an infringement of article 101 TFEU). If either threshold is met, the Commission will issue a formal written decision granting conditional immunity. Conditional immunity is subject to the applicant’s continuous observance of its duty of genuine cooperation (termination of the involvement in the cartel – unless exempted as discussed above – no destruction or concealment of relevant materials as well as no disclosure to third parties prior to the application, see response to question 29). Final immunity will be confirmed only in the Commission’s final infringement decision.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

39. Does the authority put its commitment in writing?

European Union

As specified in response to question 38, the Commission will issue a written decision granting conditional immunity. This decision is only addressed to the applicant and the letter can either be send or, on the applicant’s request, be made available at the Commission’s premises.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

40. Who is given access to the document?

European Union

The formal decision granting conditional immunity is addressed to the immunity applicant. The decision is not made public, nonetheless it is part of the Commission’s investigation file and it is, therefore, accessible to the addresses of the Statement of Objections at the Commission’s premises in the context of the access to file procedure.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

41. Does the authority publish a model letter for conferring immunity?

European Union

No.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

42. Is there an individual immunity programme?

European Union

No, there is no specific individual immunity programme.

Article 101 TFEU refers to undertakings or associations of undertakings. In certain circumstances, individuals may happen to be deemed undertakings under EU competition law. As such, they may apply for leniency following the general rules.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

43. What is the process for applying?

European Union

See response to question 42.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

44. What are the criteria for qualifying?

European Union

See response to question 42.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

Revocation of immunity

45. On what basis can corporate immunity be revoked?

European Union

At any point of the administrative proceedings the undertaking may lose the immunity conditionally granted. However, the applicant can only challenge the revocation by appealing the final decision.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

46. When can it be revoked?

European Union

See question 39. Conditional immunity may be withdrawn at any point during the investigation until the Commission adopts the infringement decision, at which time it decides whether to grant or refuse immunity. If, during the investigation, it becomes apparent that immunity is not available or that the applicant has not met the conditions for grant of immunity, the Commission will inform the applicant and the applicant may withdraw the evidence it has submitted. 

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

47. What notice is required to revoke?

European Union

See responses to questions 45 and 46. If the revocation occurs prior to sending the Statement of Objections, the revocation would have to be mentioned in the Statement of Objections as, according to its own Antitrust Manual of Procedures, the Commission must indicate the essential facts and matters of law, which may result in the imposition of a fine. If the Commission revokes conditional immunity after receiving replies from other participants, it will have to issue a Supplementary Statement of Objections.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

48. Can the applicant file a judicial challenge to a decision to revoke?

European Union

The applicant can challenge an infringement decision before the General Court. The Commission choice to revoke immunity previously granted can constitute a plea in law.

In October 2005, in the context of the Italian Tobacco cartel, the Commission fined Deltafina for participating in a purchase and bid-rigging cartel, despite being the first immunity applicant. The Commission did not confirm the conditional immunity granted under the 2002 Commission’s leniency notice as Deltafina was found to have informed the other cartel participants of the proceedings, prior to a Commission’s dawn raid. Deltafina appealed the Commission decision. In case T-12/06, the General Court rejected the application for annulment of the EC’s decision and held that the undertaking had breached its duty of continuous cooperation by deliberately and voluntarily making the other cartellists aware of its application and failing to report such disclosure to the authority. In case C‑578/11 P, the European Court of Justice dismissed Deltafina’s appeal and confirmed the revocation of immunity.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

Reduction in sanctions

49. Does the leniency programme allow for reductions in sanctions?

European Union

Yes. Even if an undertaking does not meet the requirements for immunity, it can benefit from a reduction of the fine.

To qualify for a fine reduction, the undertaking must (i) “provide the Commission with evidence of the alleged infringement which represents significant added value with respect to the evidence already in the Commission’s possession” and (ii) comply with the obligations set out in the Commission’s leniency notice (duty of genuine cooperation, termination of the involvement in the cartel, no destruction or concealment of relevant materials as well as no disclosure to third parties, whether prior to or following the application).

The Commission’s leniency notice states that “the concept of ‘added value’ refers to the extent to which the evidence provided strengthens, by its very nature and/or its level of detail, the Commission's ability to prove the alleged cartel.”

The Commission’s leniency notice also sets out some criteria for the assessment of the evidence:

  • written evidence from the period in which the conduct occurred is preferred to evidence subsequently established;
  • incriminating evidence with a direct relevant vis-à-vis the facts is preferred to the indirect one; and
  • compelling evidence is preferred to evidence that needs corroboration if contested.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

50. What is the process for seeking a reduction in sanctions?

European Union

To benefit from a fine reduction, undertakings have to make a formal application to the Commission and provide evidence contributing significant added value compared to the materials already at the Commission’s disposal.

The Commission will not take any position on such application before it has decided on any pending applications for conditional immunity in relation to the same alleged cartel.

As with immunity, fine reductions are granted only at the end of the administrative proceeding by means of the infringement decision. Nonetheless, still during the investigation, the Commission will inform the applicant in writing of the outcome of its preliminary assessment. If the application has been deemed insufficient to meet the threshold, the undertaking may provide further evidence to qualify for the reduction up until the issuance of the Statement of Objections. At this stage, the Commission will also indicate to which company it intends to grant a reduction within which band. The first applicant to provide significant added value can benefit from a reduction between 30 and 50 per cent of the fine otherwise imposed. The second can benefit from a reduction between 20 and 30 per cent and all other applicants can benefit from reductions up to 20 per cent.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

51. Is there a marker process similar to immunity applications?

European Union

No. There is no marker available in the context of the application for the reduction of a fine.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

52. Are the reductions in sanctions fixed or discretionary?

European Union

Reductions in fines are not fixed and the Commission has a discretionary power to determine them within certain “bands”. These bands are based on the point in time when the undertaking has made its application:

  • First undertaking to provide significant added value can receive a reduction of 30-50 per cent.
  • Second undertaking to provide significant added value can receive a reduction of 20-30 per cent.
  • Subsequent undertakings that provide significant added value can receive a reduction of up to 20 per cent.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

53. How are the reductions in sanctions calculated?

European Union

See response to question 52.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

54. Are there sentencing guidelines?

European Union

The Commission’s guidelines on the method of setting fines have been published in OJ C 210, 1.9.2006, p. 2–5.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

Cooperation obligations for sentencing reductions

55. If an applicant's cooperation reveals self-incriminating information that expands the scope of the conduct known to the authority, will that conduct be factored into the fine calculation?

European Union

If the applicant for a fine reduction is the first to submit compelling evidence, which the Commission uses to establish additional facts increasing the gravity or the duration of the infringement, the Commission will not take such additional facts into account when setting any fine to be imposed on the undertaking that provided this evidence.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

56. Are there fixed or discretionary discounts for the first applicant to cooperate after the immunity applicant (assuming there is an immunity applicant)?

European Union

See response to question 52.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

57. Other than fine reductions, are there additional incentives offered to an applicant that is the first non-immunity applicant?

European Union

There are no additional incentives offered to the first non-immunity applicant apart from a fine reduction.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

58. Does the competition authority publish guidance regarding sentencing reductions?

European Union

Yes. See response to question 54.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

59. Does the authority provide for "Leniency Plus" benefits?

European Union

No. EU law does not provide for "Amnesty Plus" such as those provided under, for example, US law.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

60. How is the Leniency Plus discount calculated?

European Union

See response to question 59.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

61. Are the cooperation obligations similar to those for immunity applicants?

European Union

Yes, see response to question 49 for more details.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

62. Will the applicant be required to make a written confession?

European Union

No, the procedure is the same as for the immunity application. See response to question 30 for more details.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

63. Can third parties obtain access to the materials provided by the applicant?

European Union

The same guarantees as for the immunity materials apply. See response to question 31 for more details.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

64. Will an applicant qualify for sentencing reductions if one or more of its employees refuse to cooperate?

European Union

The same rules as for the immunity applicant apply. See response to question 32 for more details.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

65. Will the applicant lose its protections if one of its employees engages in obstructive conduct before or after the application?

European Union

The same rules as for the immunity applicant apply. See response to question 33 for more details.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

66. Will the applicant be required to provide materials protected by attorney-client privilege or work-product doctrine?

European Union

The same rules as for the immunity applicant apply. See response to question 34 for more details.

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

67. Can an applicant challenge the amount of the reduction of sanctions?

European Union

As specified in response to question 50, fine reductions are granted only at the end of the administrative proceeding by means of the infringement decision. The infringement decision may be appealed.

Notably, however, the General Court has ruled on the application of the leniency notice in caseT-222/17, Recylex v Commission. Recylex claimed that Eco-Bat, which had obtained a 50 per cent leniency reduction, did not meet its duty of full and generous cooperation. Recylex alleged that Eco-Bat provided incomplete and misleading information about the territories concerned by the infringement, did not disclose the full extent of the involvement of its representatives in the infringement and provided misleading information as to the role of one of its representatives. The General Court dismissed the application and held that:

neither the wording of the 2006 Leniency Notice nor its logic supports an interpretation whereby, where two undertakings have provided evidence that represents significant added value, the undertaking which provided that evidence second is to take the place of the first undertaking if it transpires that the latter’s cooperation did not meet the requirements of point 12 of the 2006 Leniency Notice (namely duty of genuine cooperation, termination of the involvement in the cartel, and no destruction, falsification, concealment or disclosure of evidence).

Answer contributed by Alexander Israel, Beatriz Mejia and Jan Lang

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