Immunity, Sanctions & Settlements

Last verified on Monday 4th June 2018

Canada

Randal T Hughes and Emrys Davis
Bennett Jones LLP

    Immunity or a 100 per cent reduction in sanctions

  1. 1.

    What benefits are available to the first applicant to qualify?

  2. An immunity applicant is eligible for complete immunity from prosecution for specific offences under the Competition Act and related offences under the Criminal Code. Offences eligible for immunity are those in sections 45–49, 52(1)(a), 52.1, 53, 54, 55 and 55.1 of the Competition Act (offences related to price-fixing, bid-rigging, and false and misleading advertising) and sections 21 and 22 of the Criminal Code (aiding and abetting or counselling any of the Competition Act offences). Immunity is not available for obstruction of justice offences.

    Assuming the applicant meets all the criteria for immunity (see questions 4 and 5), the Commissioner of Competition (Commissioner) will recommend to the Director of Public Prosecutions (DPP) that the applicant receive complete immunity for the conduct disclosed to the Commissioner and the Competition Bureau (Bureau). The DPP heads the Public Prosecution Service of Canada (PPSC). For ease of reference, the authors refer to the PPSC throughout the remainder of these answers as it is usually an employee of the PPSC acting as agent for the DPP who interacts with immunity and leniency applicants.

    The PPSC has sole authority to grant immunity and retains an independent discretion to reject the Commissioner’s immunity recommendation. The PPSC’s policy on granting immunity is articulated in Chapter 35 of the Federal Prosecution Service Deskbook. The Commissioner and the PPSC have entered into a memorandum of understanding that sets out their respective roles in and approaches to the immunity process. As a practical matter, we are not aware of any case where the PPSC has rejected the Commissioner’s recommendation.   

    Assuming it qualifies for and receives immunity, an applicant will remain eligible to bid on projects for the government of Canada. Those convicted of Competition Act offences, including participants in the Bureau’s Leniency Program (see the answer to question 43), are disqualified from bidding on most contracts with the Canadian federal government. Recent changes announced by the federal government will reduce the period of disqualification from 10 to five years for companies that cooperate with the authorities and take remedial action.

    On 8 May 2018, the Bureau released for public comment its Draft Immunity and Leniency Programs under the Competition Act. The Draft revisions propose several significant changes, including the introduction of an interim grant of immunity until the immunity applicant’s cooperation is no longer necessary. However, the fundamental benefits of each programme (immunity from prosecution or significant fine reductions) remain intact, as do the eligibility requirements.

  3. 2.

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

  4. Yes. The corporate immunity applicant may apply on behalf of its current and former officers, directors, and employees as well as itself. (It does not have to but as a practical matter always does). The Bureau will recommend immunity for current officers, directors, and employees of a corporate immunity applicant in every case provided that they admit their involvement in the illegal activity as part of the corporate admission and provide complete, timely, and ongoing cooperation.

    The Bureau will recommend immunity for former officers, directors, and employees on a case-by-case basis. They too must admit their involvement in the illegal activity and provide complete, timely and ongoing cooperation.

  5. 3.

    Is immunity available after an investigation begins?

  6. Yes, in certain circumstances. See questions 4 and 5.

  7. 4.

    What are the eligibility requirements before an investigation begins?

  8. The eligibility requirements for immunity are:

    • the Bureau is unaware of an offence, and the party is the first to disclose it;
    • the party must terminate its participation in the illegal activity;
    • the party must not have coerced others to be party to the illegal activity;
    • the party is not the only participant in the illegal activity;
    • the party must provide complete, timely, and ongoing cooperation; and
    • the party must cooperate with the Bureau’s investigation and any subsequent prosecution at its own expense.
  9. 5.

    What are the eligibility requirements after an investigation begins?

  10. The eligibility requirements are as set out in the answer to question 4 except that a party may receive an immunity marker even after the Bureau is aware of an offence provided that it is the first to come forward with sufficient evidence to warrant a referral of the matter to the PPSC.

  11. 6.

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

  12. In its immunity agreement with the PPSC (see question 33), the applicant must represent ‘that it has engaged in the anticompetitive conduct which may constitute an offence under the (Competition) Act’. This admission is confidential as the immunity agreement is not disclosed. If, before executing the immunity agreement, the applicant determines that it has not been involved in an offence in Canada, it may withdraw from the Immunity Program.

  13. 7.

    Are ringleaders or initiators of the conduct eligible?

  14. Yes, provided that the applicant has not coerced other parties to become involved in the illegal behaviour. The Bureau has said that it will only disqualify a party where there is clear evidence of coercive behaviour such as where there is evidence that the party pressured unwilling participants to be involved.

  15. 8.

    When must the applicant terminate its involvement in the conduct?

  16. Immediately upon being granted an immunity marker. Should the applicant believe that termination of its participation in the illegal conduct will compromise the Bureau’s investigation, it should immediately advise the Bureau and receive direction from the Bureau on how to proceed (such as when withdrawing from regular meetings would alert the other participants to the party’s likely cooperation with the Bureau and risk compromising the Bureau’s investigation).

  17. 9.

    What constitutes termination of the conduct?

  18. This will vary by the nature of the illegal conduct. In the case of an ongoing price-fixing conspiracy, it may involve ceasing to participate in meetings of the participants, ending other regular communications with fellow participants, or refusing to discuss bids in advance of an upcoming RFQ (request for quotation).

  19. 10.

    Will the applicant be required to make restitution to victims?

  20. Not in order to receive an immunity marker or qualify for a recommendation for immunity. Immunity applicants often face civil claims brought as class actions under section 36 of the Competition Act and the common law arising after information about the investigation by the Bureau or foreign antitrust agencies becomes known. Restitution is often made in the context of these claims, but is not a requirement for participation in the Bureau’s Immunity Program.

  21. 11.

    Can more than one applicant qualify for immunity?

  22. No. Only one immunity position is available. The Bureau has said that it will not generally consider joint requests. Only one party per offence will receive immunity. However, the Bureau will make exceptions for companies that are affiliated, as defined in subsection 2(2) of the Competition Act.

  23. 12.

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

  24. No. If an employee reports the conduct to the Bureau first, the corporation will not qualify for immunity unless the employee loses his or her immunity marker. This could occur, for example, if the employee fails to meet the requirements of the Immunity Program such as by failing to provide complete, timely and ongoing cooperation.

  25. 13.

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

  26. Applicants may request an immunity marker only for offences under the Competition Act and related Criminal Code offences (see the answer to question 1). Included among the offences under the Competition Act are offences related to false and misleading advertising that may be considered non-antitrust infringements in some jurisdictions.

  27. 14.

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

  28. The Bureau treats the identity of the immunity applicant and the information it provides as confidential except where:

    • disclosure is required by law (such as when a co-conspirator is charged with an offence and the prosecution must disclose all evidence relevant to the case);
    • disclosure is necessary to obtain or maintain a judicial authorisation for the exercise of investigative powers (eg, a search warrant or wire tap);
    • disclosure is for the purpose of securing the assistance of a Canadian law enforcement agency in the exercise of investigative powers;
    • the applicant has agreed to disclosure;
    • the applicant has publicly disclosed its immunity position; or
    • disclosure is necessary to prevent the commission of a serious criminal offence.

    In addition to the above exceptions, the Bureau will disclose the information provided by the applicant (but not its identity) where disclosure is required for the purpose of the administration or enforcement of the Act.

    The most likely instance in which the Bureau will disclose information obtained from the immunity applicant is when it seeks judicial authorisation for an investigative process, like a search warrant or a civil production order under section 11 of the Competition Act. In those circumstances, the Bureau has said that it will draft Informations to Obtain (ITOs) and affidavits to keep the applicant’s identity confidential unless doing so would not reveal sufficient grounds to obtain the authorisation requested. If the applicant’s identity cannot be kept confidential, the Bureau will request a sealing order to keep either the ITO or the affidavit, or a relevant portion thereof, sealed until charges are laid.

    However, while an applicant’s identity may be sealed, in the past, information provided to the Bureau (assuming the information itself does not identify the immunity applicant) has been publicly available in the court file once the Bureau has executed the search or obtained the civil production order. Plaintiffs in both the United States and Canada have used the detailed information available from ITOs and affidavits to begin civil claims against cartel participants, including the immunity applicant. Recently, the Bureau has indicated that it will seek sealing orders in appropriate cases to prevent early disclosure of this information.

    The Bureau will not disclose the applicant’s identity or its information to any foreign law enforcement authority without the applicant’s consent. Where an applicant is cooperating in several jurisdictions, the Bureau expects the applicant to provide substantive and procedural waivers to permit the Bureau to coordinate its investigation with foreign authorities.

    Once the Crown charges an accused with an offence, it must disclose to the accused all relevant factual information received from the immunity applicant in order for the accused to be able to make full answer and defence. The Crown's disclosure obligation applies to information provided before and after execution of the immunity agreement. Although settlement privilege applies to information provided by the immunity applicant before signing an immunity agreement, such privilege does not prohibit the disclosure to the accused of factual information provided to the Crown in respect of a proposed criminal prosecution in circumstances where the person providing that information does so with the knowledge that the Crown intends to rely on some or all of that information for the purposes of that criminal prosecution and particularly where that person has committed to providing evidence against the accused. 

  29. 15.

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

  30. Yes. The Bureau has published a bulletin titled Immunity Program under the Competition Act and related FAQs.

  31. 16.

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

  32. No, other than perhaps the requirement that the applicant cease participating in the illegal activity. If other regimes require ongoing participation so as not to reveal the applicant’s cooperation with the authorities and thus compromise their investigation, the Canadian requirement to cease participation would conflict with other regimes.

    Immunity application and marker process

  33. 17.

    What is the initial process for making an application?

  34. The applicant, or more typically the applicant’s Canadian counsel, will call the Senior Deputy Commissioner, Cartels and Deceptive Marketing Practices Branch. 

  35. 18.

    What information is required to secure a marker?

  36. The applicant must provide a description of the offence (eg, price-fixing or bid-rigging), the product affected, including any relevant sub-products, and the time period of the conduct in question. The Bureau may also request more detailed information about the participants or the geographic market to assist it in determining whether an immunity marker is available.

    The applicant need not identify itself at this stage. The request can be made on a hypothetical or no-names basis. However, upon the confirmation that a marker is available, the applicant must identify itself to receive the marker to facilitate the Bureau’s preparations for the applicant’s proffer and the Bureau’s investigation.

  37. 19.

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

  38. Initially, thirty days. The Bureau may grant extensions but only in response to specific requests from the applicant and only in appropriate situations. To obtain an extension, the applicant must often update the Bureau on the status of its internal investigation; explain how it intends to gather information to complete the proffer and what the status of its cooperation is with other agencies. The DC (deputy commissioner) will grant an extension where appropriate. In particular, the Bureau recognises that delay may be appropriate in complex cases, particularly where multiple jurisdictions are involved and information is difficult to gather.

    Should the applicant fail to request an extension or otherwise obtain an extension, its marker may automatically expire.

  39. 20.

    Can the deadline for perfecting the marker be extended?

  40. See question 19.

  41. 21.

    What is required to perfect the marker?

  42. The applicant must provide sufficient information to allow the Bureau to make an immunity recommendation to the PPSC. This requires the applicant to provide a description of the illegal activity and outline all of the information it has at that point in time relating to that activity.

    The necessary information will vary by case, but typically includes a description of:

    • the parties involved, including their business structure, market shares, and nature/level of involvement in the conduct;
    • the product involved;
    • the industry, how it functions, how pricing is established, etc;
    • market information, such as market shares, key customers, barriers to entry etc;
    • the conduct, its scope, and its potential impact;
    • the evidence available to support the above information, such as witnesses or relevant documents.
  43. 22.

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

  44. Yes. If the applicant discovers additional information and would otherwise qualify for an immunity marker (eg, another applicant has not secured a marker for the same conduct, product, and period), the marker’s scope can be expanded.

  45. 23.

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

  46. No. If the immunity applicant complies with the requirements of the Immunity Program it will not lose its marker because a second applicant has better information. However, if the immunity applicant does not provide information of an offence in Canada, it risks the Bureau asking it to withdraw its marker, failing which the Bureau will cancel the marker. In those circumstances, a second applicant could move into an immunity position provided it had evidence of an offence in Canada sufficient to allow the Bureau to make an immunity recommendation to the PPSC.

  47. 24.

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

  48. The Bureau will not make an immunity recommendation to the PPSC. Instead, it will ask the applicant to withdraw its marker, or the applicant may do so on its own. If the applicant refuses to withdraw its marker, the Bureau will cancel the marker after at least 14 days’ notice to the applicant.

  49. 25.

    What if the authority decides not to investigate?

  50. The Bureau will advise the applicant of the scope of the formal recommendation for immunity it would otherwise have made to the PPSC if the investigation had continued. The Bureau will offer to provide a letter confirming its position or, if the applicant does not wish to receive a letter, will advise the applicant orally.

    If the Bureau subsequently decides to investigate the matter, it will take steps to recommend immunity as previously described to the applicant, provided that the applicant continues to meet the requirements of the Immunity Program.

    Immunity cooperation obligations

  51. 26.

    What is the applicant required to produce?

  52. The applicant must disclose all non-privileged information, evidence and records in its possession, under its control, or available to it, wherever located, that in any manner relate to the anti-competitive conduct for which immunity is sought.

  53. 27.

    Will the applicant be required to make a written confession?

  54. No. However, in its immunity agreement with the PPSC (see the answer to question 33), the applicant must represent "that it has engaged in the anticompetitive conduct which may constitute an offence under the [Competition] Act". The proposed revisions to the Immunity and Leniency programs include a revised model immunity agreement that requires the applicant to represent that it “has engaged in the anticompetitive conduct”.

  55. 28.

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

  56. Typically no, unless the Crown charges the third party with an offence (see question 14). Information provided to the Bureau by the applicant is confidential subject to the exceptions discussed in the answer to question 14. In March 2017, the Bureau released a draft bulletin describing its approach to information requests from third parties. The Bureau will only provide confidential information to third parties in response to a court order. In response to such an order, the Bureau has said that it will take all reasonable steps to protect the confidentiality of the information, including by seeking protective orders. In January 2018, the Federal Court of Appeal held that documents provided to or collected by the Bureau are not protected on a class basis by public interest privilege. Rather, the Bureau must establish such privilege on a document-by-document basis. Whether this change will meaningfully increase third party access to Bureau documents before charges are laid is uncertain.  

  57. 29.

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

  58. No. The employee will lose protection. The corporate applicant must only take all lawful measures to secure the employee’s cooperation.

  59. 30.

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

  60. It may. Immunity is not available for obstruction or destruction of records. If the applicant becomes aware that such conduct has occurred, it should immediately report it to the Bureau. The applicant and employees who engage in obstruction after immunity is sought risk expulsion from the Immunity Program and prosecution for obstruction and the offence for which immunity was sought. Expulsion will be evaluated on a case-by-case basis. As a practical matter, it would be surprising for the Bureau to expel a corporate applicant who had taken reasonable steps to prevent obstruction because of the actions of one employee.

  61. 31.

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

  62. No. The Bureau requires production of only non-privileged materials. Canadian privilege rules differ from those in other jurisdictions and applicants are encouraged to obtain legal advice on the scope of privilege protection in Canada. In general, privilege applies to communications between an attorney and client for the purpose of obtaining legal advice, and to documents prepared for the dominant purpose of litigation.

    However, because factual information provided by the immunity applicant to the Crown in respect of a proposed criminal prosecution must be disclosed to the accused, an immunity applicant may be required to produce such factual information, which may include comprehensive and detailed information about interviews conducted during the applicant's internal investigation.

    Granting immunity

  63. 32.

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

  64. The Bureau will advise the applicant of its immunity recommendation to the PPSC. Once it decides to grant immunity, the PPSC may provide a written provisional guarantee of immunity or advance directly to the immunity agreement.

    The Bureau and PPSC propose to change the process by which an applicant receives immunity. Specifically, the Draft Immunity and Leniency Programs contemplate an Interim Grant of Immunity in writing after the proffer stage pursuant to which the applicant will provide its cooperation. Full immunity will follow only once statutory appeal periods have passed after a trial or the Commissioner and PPSC have no reason to believe that further assistance from the applicant could be necessary.

  65. 33.

    Does the authority put its commitment in writing?

  66. Yes. The PPSC and the applicant will execute an immunity agreement.

  67. 34.

    Who is given access to the document?

  68. The immunity agreement is confidential. Only the applicant, the PPSC, the Commissioner and their agents have access. See questions 14 and 28.

  69. 35.

    Does the authority publish a model letter for conferring immunity?

  70. Yes. The Bureau makes available a model corporate immunity agreement, a model individual immunity agreement, and a model letter confirming an individual’s protection under a corporate immunity agreement.

    Individual immunity or leniency

  71. 36.

    Is there an individual immunity programme?

  72. Individuals may participate in the same Immunity Program as corporate applicants. There is no separate programme.

  73. 37.

    What is the process for applying?

  74. The same process as explained in questions 17 to 25.

  75. 38.

    What are the criteria for qualifying?

  76. The same criteria as explained in questions 4 and 5.

    Revocation of immunity

  77. 39.

    On what basis can corporate immunity be revoked?

  78. The Bureau may revoke an immunity marker if the applicant fails to meet the requirements of the Immunity Program. The PPSC may revoke the party’s immunity and take other appropriate action against the party if the party fails to comply with any of the terms and conditions of the immunity agreement.

  79. 40.

    When can it be revoked?

  80. Any time the party fails to comply with any of the terms and conditions of the immunity agreement, as applicable.

  81. 41.

    What notice is required to revoke?

  82. The PPSC will provide 14 days written notice to the party before revoking immunity for a breach of the immunity agreement.

  83. 42.

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

  84. The applicant can apply to the Federal Court of Canada under section 18.1 of the Federal Courts Act, RSC, 1985, c F-7 for judicial review of the PPSC’s decision to revoke immunity. The application must be made within 30 days after the decision was first communicated to the applicant.

    Reduction in sanctions

  85. 43.

    Does the leniency programme allow for reductions in sanctions?

  86. Yes. In addition to the Immunity Program, the Bureau has a Leniency Program for applicants when immunity is no longer available. The Bureau will recommend a reduction in sanctions for qualifying applicants. As noted above with respect to the Bureau's Immunity Program, the Bureau has announced a new draft Leniency Program, which, if implemented, will result in changes to the Program. 

  87. 44.

    What is the process for seeking a reduction in sanctions?

  88. An applicant must request a marker, proffer information, and cooperate with the Bureau’s investigation as would an immunity applicant. To be eligible for leniency, the applicant must:

    • terminate its participation in the conduct;
    • agree to cooperate fully and in a timely manner, at its own expense, with the Bureau’s investigation and any subsequent prosecution of other participants; and
    • agree to plead guilty.
  89. 45.

    Is there a marker process similar to immunity applications?

  90. Yes. The marker request process is the same as for immunity applicants as described in the answers to questions 17 to 25. 

  91. 46.

    Are the reductions in sanctions fixed or discretionary?

  92. The Bureau’s recommendations for reduced sanctions are fixed. The Bureau generally uses a proxy of 20 per cent of the applicant’s affected volume of commerce in Canada to calculate the base fine. If the applicant has no commerce in Canada, for example because of a market allocation or bid-rigging agreement under which the applicant agreed not to sell in Canada, the Bureau will determine the base fine on a case-by-case basis with reference to the total affected volume of commerce in Canada. In the case of indirect sales into Canada, the Bureau will work with the applicant to construct a workable methodology to estimate the affected volume of commerce associated with indirect sales.

    From the base fine, the Bureau will recommend a first-in leniency applicant (second-in applicant overall) receive a 50 per cent reduction in the fine that it would otherwise pay. A second-in for leniency applicant (third-in applicant overall) will receive a 30 per cent reduction. Subsequent applicants may receive a discretionary reduction on a case-by-case basis. The actual amount for subsequent applicants will depend on when the applicant sought leniency and the timeliness of cooperation. Under the existing Leniency Program, later leniency applicants will not be eligible for greater discounts than earlier applicants. However, the draft revised Leniency Program provides the Bureau will discretion to increase the fine reduction up to 50 per cent for any leniency applicant in accordance with the value and timeliness of its cooperation.     

    The above fine reductions apply only to the reductions the Bureau will recommend to the PPSC, which has discretion to deviate from the Bureau's recommendation in its negotiation of a joint sentencing recommendation with the accused. The ultimate sentence imposed on a leniency applicant is in the discretion of the sentencing judge. The sentencing judge may depart from the joint sentencing submissions of the parties if the recommended sentence is contrary to the public interest or would otherwise bring the administration of justice into disrepute. As a practical matter, to the authors’ knowledge, sentencing judges have never departed from a jointly recommended sentence in the context of the Bureau’s Leniency Program.

  93. 47.

    How are the reductions in sanctions calculated?

  94. See the answer to question 46.

  95. 48.

    Are there sentencing guidelines?

  96. The Bureau publishes a Leniency Program bulletin and FAQs that set out how it calculates the recommended sentence for leniency applicants.

    The objectives and principles of sentencing are codified in sections 718 to 718.21 of the Criminal Code. There are no sentencing guidelines comparable to the United States Sentencing Commission Guidelines.

  97. 49.

    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?

  98. No. If a leniency applicant’s cooperation reveals that the scope of the initial cartel offence for which leniency was sought is broader than previously identified by or known from the Bureau’s investigation or other cooperating parties, the Bureau will not use that information against the applicant when determining a leniency recommendation.
     

  99. 50.

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

  100. See the answer to question 46.

  101. 51.

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

  102. The Bureau will recommend immunity for the current officers, directors, and employees of the first applicant to cooperate after the immunity applicant. As with immunity applicants, the Bureau will recommend immunity for former officers, directors, and employees on a case-by-case basis. In practice, this is a significant incentive for corporations to seek leniency in Canada as the first non-immunity applicant. In contrast, current and former directors, officers, employees and agents of subsequent leniency applicants may be charged depending on their role in the offence.

  103. 52.

    Does the competition authority publish guidance regarding sentencing reductions?

  104. Yes. The Bureau publishes a Leniency Program bulletin and FAQs.

  105. 53.

    Does the authority provide for "Amnesty Plus" benefits?

  106. Yes. If a leniency applicant is the first to disclose information relating to another offence, it may qualify for Immunity Plus. The applicant will receive immunity for its participation in the second offence, provided it meets the requirements for immunity, and will receive a discount on the recommend fine for its first offence in addition to the discount it would receive under the Leniency Program.

  107. 54.

    How is the Amnesty Plus discount calculated?

  108. Where an applicant qualifies for Immunity Plus, the Bureau will typically recommend an additional 5 per cent to 10 per cent be added to the applicant’s leniency discount.

    Cooperation obligations for sentencing reductions

  109. 55.

    Are the cooperation obligations similar to those for immunity applicants?

  110. Yes. A leniency applicant must provide full, frank, timely and truthful cooperation. This includes production of all non-privileged information, evidence and records in its possession, under its control, or available to it, wherever located, that in any manner relate to the anti-competitive conduct for which leniency is sought.

  111. 56.

    Will the applicant be required to make a written confession?

  112. Yes. When pleading guilty, the applicant must agree to a written Statement of Admissions (likely to be renamed an Agreed Statement of Facts) that will set out the factual basis for the offence. The Statement of Admissions is filed with the court and is the evidentiary foundation for the finding of guilt and the jointly recommended sentence.

    A leniency applicant must also sign a Plea Agreement in which it agrees to plead guilty to the offence. The Plea Agreement is confidential and not filed with the court.

  113. 57.

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

  114. Typically no, unless the Crown charges the third party with an offence (see the answer to question 14). The Bureau treats information received from leniency applicants in the same confidential manner as that received from immunity applicants. See the answers to questions 14 and 28. In addition, all information provided by the leniency applicant before the plea agreement will be treated as settlement privileged. However, settlement privilege does not prohibit the disclosure to the accused of factual information provided to the Crown in respect of a proposed criminal prosecution in circumstances where the person providing that information (ie, the leniency applicant) does so with the knowledge that the Crown intends to rely on some or all of that information for the purposes of that criminal prosecution.

    However, information filed with the court on sentencing, such as the Statement of Admissions, is public. Plaintiffs can and often do obtain copies of Statements of Admissions for use in related civil ligation and class actions.

  115. 58.

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

  116. Yes. Leniency applicants must facilitate the cooperation of those officers, directors and employees covered by the Plea Agreement, but will not lose leniency if one or more refuses to cooperate.

  117. 59.

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

  118. It may. As under the Immunity Program, obstruction risks expulsion from the Leniency Program. See the answer to question 30.

  119. 60.

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

  120. No, subject to the answer to question 31 regarding privilege considerations in Canada.

  121. 61.

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

  122. An applicant could withdraw from the Leniency Program if it was not satisfied with the Bureau's recommended sentence. However, it would risk prosecution for the initial offence.

    If the sentencing judge departed from the jointly recommended sentence, the applicant could appeal the sentence to the applicable provincial or federal court of appeal. In October 2016, the Supreme Court of Canada held that if a judge wishes to depart from a jointly recommended sentence she should advise the parties in advance and may allow the accused to apply to withdraw his or her plea (depending on the circumstances).

    Settlements

  123. 62.

    How is the settlement process initiated?

  124. There is no settlement process in Canada separate from the Leniency Program. In the context of the Leniency Program, a leniency applicant typically negotiates an acceptable fine and Statement of Admissions with the PPSC following the Bureau’s leniency recommendation. The parties execute a confidential Plea Agreement, in which, among other things, the applicant agrees to plead guilty and provide ongoing cooperation at its own expense and the parties agree on the sentence to jointly recommend.

  125. 63.

    Is the amount of the sanction always fixed in the settlement agreement?

  126. See the answer to question 62.

  127. 64.

    What role, if any, do the courts play in the settlement process?

  128. See the answer to question 46.

  129. 65.

    Are the settlement documents, including any factual admissions, made public?

  130. See the answer to question 56.

  131. 66.

    Is an admission of wrongdoing required?

  132. See the answer to question 56.

  133. 67.

    Do companies that enter into settlement agreements receive an automatic sentencing discount?

  134. See the answer to questions 43 and 46.

  135. 68.

    Do all of the subjects of an investigation have to agree to the settlement procedure before it is initiated by the authority?

  136. No. Leniency applicants may plead guilty at different times.

  137. 69.

    Will the authority settle with subjects who refuse to cooperate?

  138. No. Cooperation is a requirement of the Leniency Program.

  139. 70.

    If the settlement discussions terminate without an agreement, may any information provided or statements made during the negotiations be used against the parties?

  140. The Bureau has said that information provided to it before a Plea Agreement is signed will be treated as confidential and subject to settlement privilege such that it cannot be used directly against the applicant. However, the Bureau has also said that it is free to use information provided by the leniency applicant to pursue its investigation and any evidence derived directly or indirectly therefrom may be used in any subsequent prosecution of the parties to the offence.

  141. 71.

    May a party to the settlement agreement void the agreement after it is entered?

  142. Not applicable.

  143. 72.

    Does the competition authority publish guidance regarding settlements?

  144. Yes. The Bureau publishes a Leniency Program bulletin and FAQs.

Interested in contributing to this Know-how?

E-mail our Insight Manager

Questions

    Immunity or a 100 per cent reduction in sanctions

  1. 1.

    What benefits are available to the first applicant to qualify?


  2. 2.

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


  3. 3.

    Is immunity available after an investigation begins?


  4. 4.

    What are the eligibility requirements before an investigation begins?


  5. 5.

    What are the eligibility requirements after an investigation begins?


  6. 6.

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


  7. 7.

    Are ringleaders or initiators of the conduct eligible?


  8. 8.

    When must the applicant terminate its involvement in the conduct?


  9. 9.

    What constitutes termination of the conduct?


  10. 10.

    Will the applicant be required to make restitution to victims?


  11. 11.

    Can more than one applicant qualify for immunity?


  12. 12.

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


  13. 13.

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


  14. 14.

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


  15. 15.

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


  16. 16.

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


  17. Immunity application and marker process

  18. 17.

    What is the initial process for making an application?


  19. 18.

    What information is required to secure a marker?


  20. 19.

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


  21. 20.

    Can the deadline for perfecting the marker be extended?


  22. 21.

    What is required to perfect the marker?


  23. 22.

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


  24. 23.

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


  25. 24.

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


  26. 25.

    What if the authority decides not to investigate?


  27. Immunity cooperation obligations

  28. 26.

    What is the applicant required to produce?


  29. 27.

    Will the applicant be required to make a written confession?


  30. 28.

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


  31. 29.

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


  32. 30.

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


  33. 31.

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


  34. Granting immunity

  35. 32.

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


  36. 33.

    Does the authority put its commitment in writing?


  37. 34.

    Who is given access to the document?


  38. 35.

    Does the authority publish a model letter for conferring immunity?


  39. Individual immunity or leniency

  40. 36.

    Is there an individual immunity programme?


  41. 37.

    What is the process for applying?


  42. 38.

    What are the criteria for qualifying?


  43. Revocation of immunity

  44. 39.

    On what basis can corporate immunity be revoked?


  45. 40.

    When can it be revoked?


  46. 41.

    What notice is required to revoke?


  47. 42.

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


  48. Reduction in sanctions

  49. 43.

    Does the leniency programme allow for reductions in sanctions?


  50. 44.

    What is the process for seeking a reduction in sanctions?


  51. 45.

    Is there a marker process similar to immunity applications?


  52. 46.

    Are the reductions in sanctions fixed or discretionary?


  53. 47.

    How are the reductions in sanctions calculated?


  54. 48.

    Are there sentencing guidelines?


  55. 49.

    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?


  56. 50.

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


  57. 51.

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


  58. 52.

    Does the competition authority publish guidance regarding sentencing reductions?


  59. 53.

    Does the authority provide for "Amnesty Plus" benefits?


  60. 54.

    How is the Amnesty Plus discount calculated?


  61. Cooperation obligations for sentencing reductions

  62. 55.

    Are the cooperation obligations similar to those for immunity applicants?


  63. 56.

    Will the applicant be required to make a written confession?


  64. 57.

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


  65. 58.

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


  66. 59.

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


  67. 60.

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


  68. 61.

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


  69. Settlements

  70. 62.

    How is the settlement process initiated?


  71. 63.

    Is the amount of the sanction always fixed in the settlement agreement?


  72. 64.

    What role, if any, do the courts play in the settlement process?


  73. 65.

    Are the settlement documents, including any factual admissions, made public?


  74. 66.

    Is an admission of wrongdoing required?


  75. 67.

    Do companies that enter into settlement agreements receive an automatic sentencing discount?


  76. 68.

    Do all of the subjects of an investigation have to agree to the settlement procedure before it is initiated by the authority?


  77. 69.

    Will the authority settle with subjects who refuse to cooperate?


  78. 70.

    If the settlement discussions terminate without an agreement, may any information provided or statements made during the negotiations be used against the parties?


  79. 71.

    May a party to the settlement agreement void the agreement after it is entered?


  80. 72.

    Does the competition authority publish guidance regarding settlements?