Competition Bureau Provides Useful Update to Immunity and Leniency FAQs
The Competition Bureau provided useful guidance to firms regarding its immunity and leniency programs in the form of revised “frequently asked questions: (“FAQs”) that were released today. The revised FAQs highlight several substantive and procedurals changes to these programs.
These two programs encourage firms or individuals to voluntarily disclose conduct that violates the criminal provisions of the Competition Act (the “Act”) (such as price-fixing, bid-rigging and criminal false and misleading representations) in exchange for immunity from criminal prosecution (but not from possible civil liability) or lenient treatment on sentencing.
Key changes to the FAQs include:
- Sales into Canada. Consistent with the Bureau’s historic enforcement position, the revised FAQs indicate that applicants should seek immunity and leniency even if they do not sell products in Canada, if the conduct in question may have affected the Canadian market. For example, where the applicant has agreed with competitors to refrain from or limit its Canadian sales or, in the case of deceptive marketing practices, where Canadian call centres are used to target consumers located outside of Canada.
- Discontinuing an Investigation. The FAQ’s clarify the Bureau’s position that, where it decides not to pursue an investigation into the alleged conduct, it will not make a formal recommendation of immunity to the Public Prosecution Service of Canada (the “PPSC”). Instead, the Bureau will advise the applicant of the recommendation it would have made to the PPSC had it pursued its investigation and commits to making this recommendation in the event the investigation is recommenced.
- Immunity Plus Quantified. Parties that are not the first to disclose conduct to the Bureau may still qualify for immunity if they are the first to disclose information relating to another offence (referred as “Immunity Plus”). Where the applicant qualifies for an Immunity Plus discount, the FAQ’s indicate that Bureau will typically recommend an additional fine discount of between 5% - 10%. The factors considered in determining the appropriate Immunity Plus discount include the strength of the evidence provided by the applicant and estimated significance of the newly disclosed conduct.
- Fine Calculation for Bid-Rigging. he FAQs confirm that Bureau’s current enforcement approach is to seek criminal sanctions against all parties to a bid-rigging scheme regardless of whether they submitted a bid, agreed to withdraw a bid, or whether they were ultimately chosen to supply the product.
Additionally, the revised FAQ’s provide helpful information regarding the timing of immunity/leniency applications, when standard timelines may be extended, as well the information the Bureau requires to perfect immunity/leniency applications and the nature of the cooperation expected of applicants.
For a copy of the Competition Bureau’s press release regarding the revised FAQ's, please click here.