In October 2007, the Competition Bureau announced key changes to its successful Immunity Program, which had been introduced in 2000. Under the program, immunity from prosecution is available to the first party to disclose evidence of coordinated criminal anti-competitive activity such as price-fixing agreements among competitors. The program has been a highly effective enforcement tool, encouraging early disclosure of competition offences that may otherwise be difficult for the authorities to detect and prosecute.
The most significant change announced in October, following a public consultation process, was the commitment to introduce a formal leniency program in Canada for parties who do not qualify for immunity. In other jurisdictions, second-in and subsequent parties are afforded a declining scale of leniency within certain ranges of discounts for fines (e.g., first-in gets immunity; second-in can be eligible for up to 50 per cent off its fine depending upon the utility of its cooperation; third-in may be eligible for up to 30 per cent off its fine, etc.). Certain guidelines may also govern the treatment and sentencing of individuals and the number of individuals who may be carved out of the corporate grant of leniency. At present in Canada, no formal guidelines govern whether or how cooperation would affect the fine or sentence to be imposed for those who have lost the race for immunity. This aspect of the current Canadian program arguably does not encourage second-in or third-in parties to cooperate because there is no certainty regarding how their cooperation would be treated in relation to other parties to the offence.
In addition to the future introduction of a formal leniency program, significant changes to the Immunity Program announced in October included:
- changes to the pre-conditions for a grant of immunity — in the past, applicants were not eligible if they were the "instigator" or "sole beneficiary" of the conduct in Canada; now applicants will be excluded if they "coerced" others to participate;
- replacement of the former two-step procedure involving a provisional guarantee of immunity (PGI) and final immunity agreement with a single conditional immunity agreement;
- protection of current directors, officers and employees from the corporate grant of immunity as long as they admit participation in the alleged offence and cooperate with the authorities; former directors, officers and employees of a corporate immunity applicant will continue to be dealt with on a case-by-case basis as the corporate immunity agreement does not provide automatic protection; and
- revocation of immunity for non-disclosure of other competition-related offences limited to circumstances where there is intentional non-disclosure or where no due diligence is exercised by the immunity applicant.
- There will be no formal "penalty plus" program adopted in Canada. Under the US penalty —plus policy, an applicant who applies for amnesty for one offence but fails to disclose a second offence is subject to an increased penalty for the second offence. In Canada, the Bureau will maintain its existing policy of potential revocation of immunity for the first offence and consideration of the non-disclosure as an aggravating factor on sentencing for the second offence.
The recent changes also remove the requirement that an immunity recipient provide restitution (which is ensured by private actions for damages), confirm that the Bureau will not pursue proactive immunity (i.e., contacting those it considers may have useful information with an offer of immunity), and indicate that the Bureau may disclose the recipient’s identity without notice or consent for the purpose of administration or enforcement of the Competition Act.