The European Commission’s leniency policy is viewed as a crucial tool for fighting cartels. In an attempt to encourage whistle blowers to come forward more readily, the Commission has announced that it has established a dedicated email address for leniency applicants and is now willing to accept confessions about anti-competitive conduct by email.
The European Commission’s leniency policy
Under the Commission’s leniency policy, companies engaged in cartel behaviour are able to receive immunity from fines, where they provide information that assists the Commission in proving cartel infringements. To gain immunity from fines under the leniency policy, a company which took part in the cartel must be the first participant to notify the Commission of the cartel and the information that it provides must enable the Commission to carry out ‘dawn raids’ at the premises of those other companies allegedly involved.
Companies which are not the first to inform the Commission about the existence of the cartel are still able to materially reduce their fines by providing evidence that represents “significant added value” to the information that the Commission already has (the companies must also have terminated their participation in the cartel). The first company to meet these conditions is granted a 30%-to- 50% reduction, the second a 20%-to-30% reduction and subsequent companies up to a 20% reduction.
Under the previous system, a dedicated fax number for reporting anti-competitive conduct was used to ensure that the precise date and time of the submission was recorded. However, from 1 January 2016, the fax number will no longer be active and all leniency applications must be made via email.
From a practical perspective, it is worth noting that the Commission has warned would-be whistleblowers that, due to technical constraints, the size of a single email sent to the leniency address should not exceed 15MB. This means that, in practice, where the information to be summited exceeds 15MB, it will have to be split across several emails in order to avoid the risk of the application being rejected by the server / not being received by the Commission.
Due to the potentially material differences in fines between being the first to place a marker down for leniency, coming third or even missing out completely, companies and their legal advisers will have to take extra care to ensure that there is no room for technical error in submission of applications. It would be a very costly mistake indeed if a company had to settle for a 50% reduction in fines rather than immunity due to an oversized email bouncing back.