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SANCTIONS
IN ANTITRUST CASES
Presentation of the OECD Background paper
Semin Park
OECD Competition Division
Global Forum o...
• Objectives with fining policy
– Deterrence, punishment, disgorgement or
compensation
– The objectives and the method of ...
• (i) Determination of basic fine
– Relevant turnover vs. Total turnover
– The gravity of the infringement and the duratio...
• Parental liability
– Determination of maximum fining cap
– Establishment of recidivism
• Calculating fines involving ver...
• Current level-Not sufficient to achieve
optimal deterrence
• Raising fines:
– Unintended spill-over effects
– Conflict w...
• Criminal sanctions
– Alignment of individuals’ incentives
– The difficulty of obtaining sufficient evidence, no compatib...
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Sanctions in Anti-trust cases – OECD Background paper – November 2016 OECD discussion

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This presentation by the OECD Competition Division was made during the discussion on "Sanctions in Anti-trust cases" held at the 15th Global Forum on Competition on 2 December 2016. More papers and presentations on the topic can be found out at www.oecd.org/competition/globalforum/competition-and-sanctions-in-antitrust-cases.htm

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Sanctions in Anti-trust cases – OECD Background paper – November 2016 OECD discussion

  1. 1. SANCTIONS IN ANTITRUST CASES Presentation of the OECD Background paper Semin Park OECD Competition Division Global Forum on Competition Session IV - 2 December 2016
  2. 2. • Objectives with fining policy – Deterrence, punishment, disgorgement or compensation – The objectives and the method of fines • Anticompetitive conduct subject to fines – Abuse of market dominance – Cartel • Addressees of fines – Individuals and companies Objectives of antitrust fines, anticompetitive conduct and addressees 2
  3. 3. • (i) Determination of basic fine – Relevant turnover vs. Total turnover – The gravity of the infringement and the duration • (ii) Adjustments – aggravating circumstances • Recidivism, Leading role in the infringement, etc. – mitigating circumstances • Co-operation with the authorities, compliance programmes, etc. • (iii) Comparison to limits – a percentage of annual turnover vs. a percentage relevant turnover – Consideration for proportionality and bankruptcy – Inability to pay claim • (iv) Considerations related to leniency programmes Common steps in setting of fines 3
  4. 4. • Parental liability – Determination of maximum fining cap – Establishment of recidivism • Calculating fines involving vertically-integrated undertakings and foreign sales • Suspensory effect of judicial scrutiny – Weakening deterrent effect of fines • Collection of fines – Appeals court slow to decide – Liquidation with subsequent formation of different entities – No power to collect fines • Imposition of fines on trade association – Low relevant turnover, limited assets Challenges in determining fines 4
  5. 5. • Current level-Not sufficient to achieve optimal deterrence • Raising fines: – Unintended spill-over effects – Conflict with proportionality • The mix of corporate fines and individual sanctions Why alternatives to corporate fines?
  6. 6. • Criminal sanctions – Alignment of individuals’ incentives – The difficulty of obtaining sufficient evidence, no compatibility with its values, the costs of criminal sanctions • Director disqualification – A sanction against individuals without the complexity and uncertainty of a criminal process – Against directors, not employees, the deterrent effect depending on how close the director is to retirement • Publication of findings of infringements • Debarment against bid rigging – Effective sanction due to the impact on the turnover – Conflict with a leniency programme, risk for bid rigging in markets with few potential suppliers Alternatives to fines

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