The Australian Competition and Consumer Commission (ACCC) has released a draft new Immunity and Cooperation Policy for Cartel Conduct (new policy) and a supporting Frequently Asked Questions document (FAQs) for public comment.
This is the latest step in the ACCC’s review of its existing policy and interpretation guidelines.
The immunity policy is a key part of the ACCC’s compliance and enforcement program targeting ‘cartel conduct’ (including price fixing, bid rigging and other collusive anti-competitive conduct prohibited under Division 1 of Part IV and section 45(2) of the Competition and Consumer Act 2010 (Cth)).
The closing date for comments is 7 May 2014.
A user-friendly policy
The ACCC has achieved its aim of making its policy clear, accessible and user-friendly. This is an important step forward, as the ACCC relies heavily on self-reporting by immunity applicants for the detection and prevention of cartel conduct. The proposed new policy improvements include:
- plain English drafting
- logical headings and content structuring
- a new ‘step by step’ guide to the immunity process
- additional examples
- a new process flow chart which gives a clear visual overview of the immunity process and
- a new illustration which summarises the ‘amnesty-plus’ concept.
The FAQs would replace the existing interpretation guidelines. This will be welcomed by users, as the status and purpose of the interpretation guidelines and its interaction with the existing policy has caused uncertainty and confusion.
The majority of the FAQs match the proposed new policy’s ‘step by step’ guide and provide helpful supporting content (e.g. explanations of key terms such as ‘marker’ and ‘proffer’ which are unlikely to be familiar to potential immunity applicants).
In the context of the public-facing policy, the well-known and inherently user-friendly FAQ format is likely to be a success.
The proposed new policy reflects the changes highlighted in the ACCC’s 2013 discussion paper:
- streamlining the civil (ACCC) and criminal (Commonwealth Director of Public Prosecutions (CDPP)) processes for granting immunity (see below)
- removal of the ‘clear leader’ concept from the list of immunity criteria (one of the criteria under the current policy is that the applicant is not the ‘clear leader’ of the cartel)
- clarification of the ACCC’s approach to assessing leniency applications
- clarification of the ‘amnesty plus’ concept (an applicant who does not receive immunity for reporting one cartel, but reports a second, un-related cartel, may be eligible for ‘amnesty plus’ leniency in relation to the first cartel) and
- clarification of the ACCC’s approach to withdrawing immunity.
Overall, while these changes would not represent a significant shift in policy or approach, the ACCC has succeeded in making its policy and procedures clearer and more transparent.
New criminal immunity ‘letters of comfort’
Perhaps most importantly, the ACCC has worked with the CDPP to address concerns regarding the coordination of the ‘dual track’ civil and criminal cartel immunity processes. The proposed new policy sets out a process to facilitate the provision of a CDPP ‘letter of comfort’ at the same time as the provision of an ACCC ‘letter of comfort’ (offering an applicant conditional civil immunity). It is proposed the CDPP ‘letter of comfort’ will recognise the applicant’s ‘first in’ status and confirm the CDPP’s intention to formally grant conditional criminal immunity under section 9(6D) of the Director of Public Prosecutions Act 1983 (Cth) at the appropriate time (i.e. prior to the commencement of a criminal prosecution).
The fact that the CDPP does not currently offer ‘letters of comfort’ was a significant issue identified during the ACCC’s consultation process. It is obviously very important for applicants to have some form of up-front certainty that both conditional civil and criminal immunity have been or will be granted.
If the new coordinated approach is a success, it will remove a potential disincentive for applicants and increase the effectiveness of the ACCC’s immunity policy and cartel enforcement program.
No set cooperation discount percentages
The proposed new policy does not specify up-front cooperation discount percentages, but users will be assisted by additional details in the proposed new policy regarding the factors the ACCC will consider in assessing leniency applications, as well as additional information regarding the CDPP’s assessment of criminal leniency applications.