Compliance, and in particular competition compliance, remains at the top of in-house counsel’s agenda. In particular, compliance is fundamental to reducing competition law infringements – “prevention is better than cure” – but in-house counsel often face difficulties in getting the appropriate level of support and budget for effective competition law compliance.
We have recently published an article which puts forward a policy proposal to the European Commission (“Commission”) that would not only support companies in their competition compliance efforts, but also the Commission in its enforcement of EU cartel rules.
We propose that within the context of cartel settlements the Commission offer limited reductions in fines for competition law infringements (up to 5% of the fine), against auditable and enforceable binding commitments by the affected companies to spend that fine reduction on increased future compliance efforts.
This proposal – building on, but differing from, earlier suggestions – is straightforward, realistic, and easily and quickly implementable in the context of the existing legal framework and the Commission’s fining guidelines.
Companies benefit from financial support committed to compliance over several years to increase their compliance efforts, and decreasing the likelihood that they will be involved in future cartels.
The Commission benefits by reducing the likelihood of future antitrust infringements, increasing incentives for companies to enter into settlements – and decreasing the likelihood of hybrid settlements and reducing yet further the number of appeals – all without needing to deploy further resources of its own.
While we believe that this present proposal – if implemented – will enhance the effectiveness of antitrust compliance programmes, we also acknowledge that it is only one “tool” to achieve this aim, and not a panacea.
But given that anticompetitive activity, including the most egregious forms such as cartels, continues, the question for the Commission is perhaps not whether or not this proposal should be implemented, but, if not this, then what?
A pdf of the article can be accessed by our Covington Competition Blog subscribers here.