Competition Law in Pakistan and China: A Comparative Study

The present study aims to make comparative analysis of competition law in Pakistan and China by analyzing the leniency programs that whether or not they are in accordance with market structure or not, and investigating the mechanism to evidences while applying leniency policies and its value in competition law. The study adopts qualitative data analysis in order to analyze the respective aims and objective. It is found out by this research that progressive and unconventional are very important to be taken by both countries in order to ingeniously enforce competition law. Although competition law is supposed to prevent anti competition rituals and practices by nurturing free and fair competition in the market. It promotes a greater competition in the market by safeguarding customers against inaccurate means, which are adopted by firms. Therefore, competition law can be regarded as highly essential for regulating businesses by ensuring producer and consumer welfare. It ultimately promotes healthy growth of the economy and social justice. While on the other hand, a huge budget is entailed by investigation procedures which have been regarded as a huge financial resources’ loss by experts. In addition to this, there is also a greater risk of surcharges of violation, punishment and legal costs, which sometimes lead to harm corporate image. Moreover, the leniency programs in both Pakistan and China cover administrative liability only. Therefore, it is important to voluntarily comply with competition rules, regulations and laws, which would play an immensely significant role in minimizing the social costs which occur due to this law enforcement. Qualitative research methodology has been applied to the following article.

4 Cartel Detection

This chapter is concerned with cartel detection, through market monitoring, inspections, or well-designed leniency programs. It analyses three methods competition authorities regularly use to detect, and adduce evidence about, cartels. First, competition authorities can detect cartels by monitoring and screening markets. Second, competition authorities can conduct inspections at the business premises or private homes of cartel participants. Third, given the limitations of the first two methods, competition authorities can incentivize companies to report the cartels in which they may be involved by rewarding them for their cooperation. Pursuant to so-called leniency programmes, companies that choose to cooperate will, depending on the quality of the information provided and the time at which it is provided, benefit from full immunity from fines or significant fine reductions (partial immunity). Following in the footsteps of the US Department of Justice, the European Commission adopted a Leniency Notice in 1996, the application of which has allowed it to uncover a vast number of cartels.

ATTITUDES TOWARD COLLUSION IN CHILE

ABSTRACT In the last two decades, competition agencies around the world have increasingly directed their attention to enforcement against cartels. With the encouragement of the antitrust authorities of the United States, and the Organization of Economic Cooperation and Development, various countries have introduced leniency programs, and sanctions for individuals found guilty of colluding. Critics are concerned, however, that these measures are not backed by broad public support, which could jeopardize their enforcement. This paper explores public attitudes toward cartels in Chile, an emerging economy that introduced a leniency program in 2009 and criminal sanctions in 2016, by presenting the results of a public opinion survey conducted in this country in August–September 2019. The results of the survey show high awareness of cartels and the harm they cause, and high public disapproval of cartel conduct among the Chilean respondents. In particular, up to 70 percent of the respondents support prison sentences against individuals found guilty of colluding. Such strong public support for anti-cartel measures could be considered positive from the perspective of enforcement. The results also emphasize the importance of continued competition advocacy directed at the society to explain and gain public support for the anti-cartel agenda.

Part II Antitrust Investigations, 5 Leniency and Whistle-Blowers

This chapter focuses on leniency, which is an important investigative tool designed to serve the enforcement of cartel law, particularly the detection and investigation of cartel activity. In essence, leniency policy offers undertakings involved in a cartel—which self-report and hand over evidence—either total immunity from fines or a reduction of fines, which the European Commission would have otherwise imposed on them. It encourages cartel members to confess and provide first-hand, direct ‘insider’ evidence of conduct that is otherwise concealed. The leniency reward is thus essentially a cooperation incentive for undertakings that ensures detection and punishment of secret cartels. Moreover, leniency programs can help competition authorities to obtain evidence faster and at a lower direct cost, compared to other methods of investigation, and can lead to a more efficient resolution of cases. While the leniency program of the Commission is addressed to undertakings participating in a cartel, individuals can also help the Commission in the fight against cartels and other anti-competitive practices. In 2017, the Commission introduced a specially designed tool for ‘whistle-blowers’ willing to report cartel behaviour anonymously. The chapter then describes the Commission leniency and whistle-blower procedures.

PROSPEK LENIENCY PROGRAM SEBAGAI UPAYA MENGUNGKAP PRAKTIK KARTEL DALAM HUKUM PERSAINGAN USAHA DI INDONESIA

<p>Abstract <br />Cartel is a dangerous criminal offense in the competition law. The impact of this cartel practice brings huge losses to consumers. The Business Competition Supervisory Commission in Indonesia has tried to eradicate cartels, but often constraints. The difficulty is finding direct / written evidence of a cartel. While most cartel agreements are not in writing, it could only be an agreement between the parties without making it in a written agreement. Program Leniency as one of the effective solutions in combating cartel activities, several countries have implemented this program in its law, but until now Indonesia has not regulated the leniency program. This article aims to determine the prospects of how to implement leniency programs in competition law in Indonesia. The research method used is empirical legal research (sociological/non-doctrinal) with the nature of descriptive research. The results of this study indicate that the leniency program can be applied in business competition law in Indonesia by adopting it in Law No. 5 of 1999 concerning Prohibition of Monopolistic Practices and Unfair Business Competition, in applying the leniency some things to consider include: Regulation of sanctions imposed, business actors or companies must understand that there is a high risk of cartel detection by competition authorities (fear of detections), as well as elements of clarity, transparency and predictability in implementing the leniency program.<br />Keywords: Competition Law; Cartel; Leniency Program.</p><p>Abstrak<br />Kartel merupakan kejahatan yang berbahaya dalam hukum persaingan usaha. Dampak dari praktik kartel ini membawa kerugian yang besar pada konsumen. Komisi Pengawas Persaingan Usaha di Indonesia telah berusaha untuk memberantas kartel, tetapi seringkali tekendala. Kesulitannya adalah menemukan bukti langsung/tertulis adanya kartel. Sementara sebagian besar perjanjian kartel tidak secara tertulis, bisa jadi hanya kesepakatan di antara para pihak tanpa membuatnya dalam perjanjian tertulis. Leniency Program sebagai salah satu solusi efektif dalam memerangi kegiatan kartel, beberapa negara telah menerapkan program ini dalam hukumnya namun sampai saat ini Indonesia belum mengatur mengenai leniency program. Artikel ini bertujuan untuk membahas mengenai prospek bagaimana penerapan leniency program dalam hukum persaingan di Indonesia. Metode penelitian yang digunakan adalah penelitian hukum empiris (sosiologis / non doktrinal) dengan sifat penelitian deskriptif. Hasil penelitian ini menunjukkan bahwa leniency program dapat diterapkan dalam hukum persaingan usaha di Indonesia dengan mengadopsinya dalam Undang-Undang Nomor 5 Tahun 1999 tentang Larangan Praktek Monopoli dan Persaingan Usaha Tidak Sehat, dalam menerapkan leniency beberapa hal yang perlu diperhatikan antara lain: Pengaturan sanksi yang dikenakan harus diperberat, Pelaku usaha ataupun perusahaan harus memahami bahwa terdapat resiko yang tinggi dari pendeteksian kartel oleh otoritas persaingan jika mereka tidak mengajukan permohonan leniency (fear of detection), serta Unsur kejelasan, transparansi, dan prediktabilitas dalam penerapan leniency program.<br />Kata Kunci: Hukum Persaingan Usaha; Kartel; Leniency Program.</p>

Leniency Programs and Cartel Organization of Multiproduct Firms

When multi-product firms make simultaneous price-fixing agreements in different markets, they may compartmentalize these agreements by having different individuals manage them so as to avoid the contagion of antitrust authority investigations. Leniency programs can overcome this strategy but may also lead to procollusive effects for centralized firms. The introduction of US amnesty plus programs can have different competitive effects, and leniency programs may modify firms’ choice of internal structure.