Compliance

• Pages: 251-271

251

COMPLIANCE

A. Introduction

Antitrust compliance has become increasingly important as the risks

of cartel conduct, including the punishments doled out by authorities both

in the United States and in an increasing number of jurisdictions abroad,

have never been higher. A truly effective compliance program should not

only prevent cartels to begin with, but it should also limit conduct, which,

even if not illegal, may expose a company to suspicion of cartel behavior,

which itself comes at a significant cost. This chapter discusses ways in

which companies can avoid or limit antitrust liability through effective

corporate compliance programs and policies.

B. Compliance Programs

Companies involved in cartel activity must move quickly to assess

their antitrust compliance programs in order to avoid the potential

consequences of having poor programs. Companies that undertake

extraordinary efforts to implement new, or strengthen existing,

compliance programs after coming under investigation may qualify for

reduced fines in the United States and elsewhere.1 The U.S. Department

1. See, e.g., U.S. Sentencing Memo. & Mot. for a Downward Departure at 8,

United States v. Kayaba Indus. Co., LTD d/b/a KYB Corp., No. 15-00098

(S.D. Ohio Oct. 5, 2015), ECF No. 21 (recommending a 40 percent

downward departure from the Guidelines fine range in part because the

company had developed and implemented a “comprehensive and

innovative compliance policy”); Plea Agreement ¶ 13, United States v.

Barclays PLC, No. 15-00077 (D. Conn. May 20, 2015), ECF No. 6. Other

jurisdictions offering fine reductions for compliance efforts include the

United Kingdom, France, Canada, and Brazil. See OFFICE O F FAIR

TRADING, OFT’S GUIDANCE AS TO THE APPROPRIATE AMOUNT OF A

PENALTY (Sept. 2012), available at

www.gov.uk/govern ment/uploads/syste m/uploads/attachment_data /file/2

84393/oft423.pdf; Autorité de la Concurrence, Framework Document of

252 International Antitrust Cartel Handbook

of Justice (DOJ) will recommend a sentencing reduction where a company

demonstrates its extraordinary efforts to bring about a top-to-bottom

change in the corporate culture that allowed the cartel offense to occur. 2

In addition, a company that strengthens an ineffective program can avoid

a sentence of probation and monitorship. Compliance programs that

merely exist on paper are not sufficient.

Certain industries can be considered “high risk” for cartel behavior

and are thus more likely to be subject to antitrust scrutiny. Industries in

which there are few market players, high barriers to entry, a declining

market, and standardized products are more prone to cartel activity.3

Industries in which enforcers have focused in recent years—such as the

banking sector—are also likely to see continued investigations.

Organizations operating in these industries should consider affirmatively

evaluating their antitrust compliance programs to determine whether they

require updating. Similarly, companies that have previously been involved

in cartel activity may face an increased chance of further investigation.

10 February 2012 on Antitrust Compliance Programmes, available at

www.autoritedelaconcurrence.fr/

doc/framework_document_compliance_10february2012.pdf; Competition

Bureau, Corporate Compliance Programs (June 3, 2015), available at

www.competitionbureau.gc.ca/eic/site/cb-bc .nsf/vwapj/cb-bulletin-corp-

compliance-e.pdf/$FILE/cb-bulletin-corp-complia nce-e.pdf; ADMIN.

COUNCIL FOR ECON. DEF., GUIDELINES FOR COMPETITION COMPLIANCE

PROGRAMS (2016), available at

http://en.cade.gov.br/topics/publications/guidelines/co mpliance-

guidelines-final-version.pdf.

2. Although the U.S. Sent encing Guidelines pr ovide that a company wit h an

“effective” compliance program can receive a lower culpability score and

accompanying reduction in its fine, historically in cartel situatio ns, the DOJ

has not recommended any sentencing credit for pre-existing compliance

programs. See U.S. SENTENCING GUIDELIN ES MANUAL § 8B2.1 (U.S.

SENTENCING COMM’N 2018) [hereinafter SENTENCING GUIDELINES]. In

practice, the relatively high rank of employees typically engaged in or

willfully ignorant o f “cartel” conduct precludes companies from qualifying

for sentencing credit for existing compliance programs. Indeed, if a

compliance progra m is truly effective, then no cartel conduct should have

occurred in the first place.

3. See, e.g., U.S. DEP’T OF JUSTICE, ANTITRUS T DIV., PRICE FIXING, BID

RIGGING, AND MARKET ALLOCATION SCHEMES: WHAT THEY ARE AND

WHAT TO LOOK FOR (June 25, 2015), available at

www.justice.gov/atr/price-fixing-bid-rigging-and-market-alloca tion-

schemes.