On September 25, 2013, the Competition Bureau released its revised “Frequently Asked Questions” (FAQs) in relation to its Immunity and Leniency Programs, which create incentives for firms and individuals to report unlawful conduct and cooperate with the bureau in its criminal investigations.
The updated FAQs are intended to increase transparency and predictability in the bureau’s Immunity and Leniency Programs and reflect the manner in which these programs are currently managed by the bureau. The key revisions are as follows:
To benefit from the Immunity and Leniency Programs, an applicant is first granted a “marker” that records the date and time the applicant approached the bureau to report anti-competitive activities. The updated FAQs provide that:
- As long as the offence was committed in Canada, a party to an international cartel may be subject to a fine and should apply for a leniency marker even if it has no direct or indirect sales in Canada.
- If the bureau decides to discontinue an investigation, it will advise applicants of the position they would have received had the investigation continued and will respect that position should the investigation resume.
Applicants must provide a description of their role in the offence and the evidence they can provide. This information is contained in a document known as the proffer and must be provided within 30 days unless an extension is granted. In this regard, the revised FAQs provide that:
- If an applicant believes it needs more than 30 days to complete its proffer, it is up to the applicant to seek an extension to preserve its marker. An applicant will automatically lose its marker if it fails to complete its proffer within this time period or if it fails to request the extension needed
- Applicants have a positive and continuous obligation to provide the bureau with any new information.
- If, however, the bureau seeks to cancel the immunity or leniency marker for failure to meet other requirements of the programs, it will give the applicant at least 14 days’ notice of the proposed cancellation.
Volume of commerce (VOC)
For leniency applicants, fines sought by the bureau are typically calculated based on the VOC affected by the anti-competitive conduct. The FAQs now provide that:
- Detailed data identifying the VOC affected by the illegal anti-competitive conduct must be provided by the applicant in the initial stages of the proffer period, along with data and sources used by the applicant to calculate the affected VOC.
After reviewing the proffer, the bureau will recommend a fine to the Public Prosecution Service of Canada, who may then enter into a plea agreement with the leniency applicant. The FAQs now provide that:
- In cases of international market agreements where there are no Canadian sales, the recommended fine will be determined on a case-by-case basis and the VOC covered by the agreements will be considered.
- The same principle applies to bid-rigging cases: the recommended fine will factor in the total VOC covered by an agreement even if the applicant did not submit a bid.
Disclosure of information
Once a leniency applicant enters into a plea agreement, it has an ongoing duty to disclose all non-privileged information related to the offence. The revised FAQs contain specific indications on how this disclosure should proceed.
- Documents must be provided in an organized fashion and “record dumps” are now clearly prohibited;
- Documents will “typically” need to be produced in electronic format; and
- If required, the applicant must provide a professional translation of documents that are not in English or French.
The changes made in these revised FAQs do not significantly modify the bureau’s approach under its Immunity and Leniency Programs but rather reflect the bureau’s current practices. They should be read along with the programs themselves and with the bulletins published by the bureau on these matters