Competition Law Compliance, Leniency and Corporate Governance: Between a Rock and a Hard Place?

(by Andreas Stephan). In the recent much talked about Automotive News article, ‘Confessions of a Price Fixer’, an anonymous Japanese car parts executive claims to have been incentivised by his firm to plead guilty to a US antitrust charge. The implication is that the firm did this to negotiate a lower fine with the US Department of Justice and possibly distract from the involvement of more senior employees. The individual, like many other Japanese executives involved in price fixing, has now served his time and is back at work with the same company. The story raises interesting questions about corporate governance; in particular firms’ failure to adequately discipline employees involved in cartel activity. However, even where there is a willingness to take action, the individuals involved in the infringement may hold all the cards.

Is the Head of Germany’s Bundeskartellamt Right to Suggest Criminal Law Sanctions are Too Severe for Cartels?

(by Andreas Stephan) It has been reported by Bloomberg Businessweek that the President of the German Federal Cartel Office recently expressed doubts as to whether criminal sanctions were necessary in the fight against cartels. His comments are indicative of the diverging approaches taken by cartel enforcement regimes. They are made all the more interesting by the fact Germany is one of the most active European enforcers of criminal law against bid-rigging arrangements and a suggestion by another Bundeskartellamt official that individual sanctions should be abandoned altogether.