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The Perks of Being a Whistleblower: Designing Efficient Leniency Programs in New Antitrust Jurisdictions

Sandra Marco Colino, Vanderbilt Journal of Transnational Law (Vol. 50), Forthcoming 2017

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The proliferation of competition law has led to the emergence of a myriad of new antitrust regimes, most of which have less than 25 years of enforcement experience. Young jurisdictions display an inclination to adopt leniency programs, an investigative tool used in veteran antitrust systems which involves offering rewards to informants for their disclosure of information that serves as evidence of collusion. This paper attempts to develop a framework for effective leniency policy design in jurisdictions which have limited or no mileage enforcing antitrust laws. Such an endeavor requires the meticulous tailoring of the general principles developed in experienced regimes to address local needs. Through a solid review of legal and economic studies of leniency, and thorough comparative analysis, the article identifies a number of hurdles common in young systems that may be tackled with analogous solutions. Some issues ought to be addressed through the learning process given by the accumulation of experience, and require a methodological enforcement strategy and time. Others however might need the re-adjustment of either leniency programs themselves or the antitrust systems they help to enforce. While the latter approach is preferable, it more difficult to implement. The paper focuses on leniency design, and recommends three general strategies: rethinking the magnitude of the reward offered to amnesty applicants where penalties for collusion are modest; reducing discretion insofar as possible, to enhance transparency and predictability in the pre-enforcement experience phase; and ensuring a balance between the adequate protection of confidentiality on the one hand, and the need to foster international cooperation efforts to break cartels on the other. The proposals aim to contribute not only towards enhancing the efficiency of new antitrust systems. Importantly, “glocalized” efforts to tackle cartels create an invaluable joint deterrent effect, paramount to combatting the biggest and most harmful collusive practices.

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