The Commerce Commission has today released its updated cartel leniency policy.
The updated leniency policy explains how a company or an individual can apply for conditional immunity or formal cooperation if immunity is not available. Key changes in the updated policy include changes to the eligibility for conditional immunity and the related processes.
Leniency is a key tool in detecting and deterring cartels in New Zealand . It is widely used around the world to tackle cartels. Cartels are often difficult to detect and may damage the economy by removing the benefits of competition leading to higher prices and less choice for customers.
To enhance detection of cartels, conditional immunity from prosecution is offered to the first member of a cartel who informs the Commission about its operation and provides evidence to the Commission. This destabilises cartels and maximises the opportunities for the Commission to stop the harmful effects of cartels.
The Commission’s updated policy provides for a company or individual to apply for conditional immunity even after the Commission has knowledge of the cartel, but does not have sufficient evidence to launch court proceedings.
The updated policy also provides for the granting of a ‘marker’ or placeholder. In circumstances where a person wishes to apply for conditional immunity from prosecution for cartel conduct, a marker preserves their place as an immunity applicant for a specified time, while they collect information to provide to the Commission. If this is not done in a timely and satisfactory manner the marker will lapse and the next company or individual offering information on that cartel would become eligible to apply for a ‘marker’ or conditional immunity.
The updated policy also encourages applicants who admit to being in a cartel, but are only eligible for cooperation benefits and not for conditional immunity, to gain a further reduction in their recommended penalty by informing the Commission, if they are participating in another cartel.
“So far the Commission’s leniency policy has been very effective at bringing cartels to light and we expect these changes, which are in line with those in many other countries, to further improve the effectiveness of our cartel detection programme,” said Kate Morrison , Commerce Commission General Manager Enforcement.
The updated policy can be accessed from the Commission website www.comcom.govt.nz under The Commission/Cartel Leniency Policy