Welcome to the second issue of our monthly cartel column “From Collusion to Competition.”
This month we have two excellent articles from South Africa.
The first article discusses the recent procedural challenges that South African Competition Authorities have been facing when dealing with cartel cases related to complaints filed by the Competition Commission. At issue is whether they may be subsequently amended to include new allegations and responses reflecting new information learned through the course of the investigation, or whether instead new complaints would need to be filed. Uncertainty on this point has caused numerous procedural setbacks to the Competition Commission. We will all be awaiting the decisions on the currently pending appeals.
The second article reviews the Competition Commission’s policy on cartel detection, with a focus on screening. In 2004 the Commission introduced a corporate leniency policy, however there were very few applications until 2007. That same year, the Commission adopted a proactive approach to cartel enforcement which included using basic techniques to screen for collusive conduct. This was complemented by an approach to settlements which incentivized multi-product firms to identify cartel conduct in other markets when settling a particular matter, and apply for leniency. The success of screens in South Africa is one more example of the power of these tools to detect potentially illegal behavior, and how complementary they can be to leniency programs.
The most current and largest example of the power of screens was the flagging of the alleged LIBOR conspiracy and manipulation over four years ago, an also in this matter screens supplemented leniency, as an application with the DOJ was only filed well after investigations had been made public. As I have been arguing for the last several years, more authorities should be using these methods for detection, and more defendants should adopt them when faced with such allegations. But prior to any of this, the message to corporate counsel is, do not forget to incorporate screens in your antitrust compliance program in order to deter wrongdoing and protect your company in case wrong doing is in fact detected.
I hope you enjoy the reading!