Leniency PLUS⁺

The Leniency PLUS⁺ concept of CDC is addressed to cartel members interested in limiting the risk of being exposed to private damage claims by cooperating with CDC.

CDC shares the position of the European Commission and national competition authorities that the public and private enforcement of antitrust law complement each other. Leniency programmes play an important role in the enforcement of antitrust law, because they facilitate the uncovering of secret cartels. Former cartel members willing to cooperate can provide relevant insights into the structure, organisation and operation of cartels, and might provide information on price effects on the markets concerned. With its Leniency PLUS⁺ concept CDC extends the idea of public leniency programmes to the area of private antitrust enforcement. It creates a further incentive for cartel members to limit the consequences of their past participation in illegal cartels, because the Leniency PLUS⁺ concept reduces their risk exposure to claims for damages resulting from anticompetitive practices.

-    Public leniency programmes
-    The CDC Leniency PLUS⁺ concept
-    Frequently asked questions

Public leniency programmes

Leniency programmes in the field of antitrust law respond to the fact that cartels, by their very nature, are secret and usually difficult to detect. It is widely acknowledged that it is in the public interest to grant undertakings involved in such anticompetitive practices a benefit for successfully cooperating with competition authorities in the investigation of the cartel. Thus, cartel members which fulfil the conditions of public leniency programmes may have their fine reduced substantially or they may be able to avoid a penalty altogether. In some European countries (for example, England and Wales) individuals may also be able to avoid criminal prosecution.

In order to benefit from public leniency programmes, the leniency applicant has to cooperate with the competition authority during the entire proceedings without cease and restriction. The leniency applicants generally provide a corporate statement containing a detailed description of the alleged antitrust law infringement, such as information on the cartel participants, their meetings, the operation of the cartel, the market concerned, the duration of the cartel and the affected market volumes. In particular, leniency applicants normally have to identify all undertakings and individuals involved in the alleged cartel. Finally, upon request of the competition authorities, they have to provide explanations in respect of the evidence submitted.

However, leniency applicants still face the risk of private actions for damages resulting from a given cartel. In particular, leniency applicants may be held liable for the entire damage caused by the cartel, as the cartel members are jointly and severally liable in this respect. An immunity or reduction of fines granted under public leniency programmes does not protect cartel members from private damage actions [see, for example, the 2006 Leniency Notice of the European Commission, OJ C 298/17, 08/12/2006, para 39]. On the contrary, the information submitted by leniency applicants to the competition authorities might indirectly facilitate the substantiation of damage claims by cartel victims.

In the antitrust damage cases that CDC has brought to court already, that is, in the German Cement Cartel case and the Bleaching Agent Cartel case, some companies have previously cooperated under the public leniency programmes. Leniency programmes are also relevant in most of the other cases where cartel activities have become publicly known and therefore may be the basis of private damage claims.

Exemplary Leniency Programmes in the EU:

•    European Union
•    Germany
•    United Kingdom
•    France 

The CDC Leniency PLUS⁺ Concept

The Leniency PLUS⁺ concept of CDC is addressed to cartel members interested in actively managing their risk exposure in view of private damage actions. The benefit resulting from the Leniency PLUS⁺ concept might be taken without, parallel, or subsequently to the participation in public leniency programmes. CDC therefore also welcomes cartel members that have not, or not successfully, participated in the public leniency programme offered by the competition authorities.

The basic idea of Leniency PLUS⁺ is to provide incentives for cartel members to cooperate in the private enforcement of antitrust law by minimising their risks under the principle of joint and several liability (see Joint and Several Liability). An essential aspect under Leniency PLUS⁺ is the commitment of CDC not to enforce damage claims against cooperating cartel members. The damage action will only be enforced against the other cartel members. As CDC is purchasing cartel-related damage claims from a multitude of damaged companies, as well as from customers of other cartel members, CDC is in position to bundle a large part of the damage claims to which Leniency PLUS⁺ candidates could potentially be exposed. Therefore, cartel members could even benefit twice if they decide to cooperate under both the public leniency programmes and the CDC Leniency PLUS⁺ concept. This double benefit strengthens the effectiveness of the competition rules, while taking into account both the victims’ fundamental right to full compensation for any loss caused by the cartel and the interests of cartel members in a reasonable liquidation of the legal consequences which they have to bear because of their antitrust law infringement.

Thus, with its Leniency PLUS⁺ concept CDC contributes to a reconciliation of public leniency programmes and the private enforcement of antitrust law. CDC seeks to successfully enforce cartel-related damage claims without preventing cartel members from benefiting from public leniency programmes and exposing public leniency applicants to an enlarged risk in follow-on damage actions. The Leniency PLUS⁺ concept responds to the fact that the leniency programmes of the Commission and national competition authorities do not oblige leniency applicants to compensate for damages caused by the cartel.

In view of ensuring confidentiality, details on the Leniency PLUS⁺ concept can be discussed directly with CDC. If you are interested in this concept, please send an email to: LeniencyPLUS+@carteldamageclaims.com.