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Newsletter | July 2016, Issue 2
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ANTITRUST & COMPETITION
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KFTC’s Amended Cartel Leniency Regime and Leniency Application Procedures
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On April 15, 2016, the Korea Fair Trade Commission (“KFTC”) began implementing its amended cartel leniency regime (“Amended Leniency Regime”).
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The amended leniency regime sets forth items, such as criteria for mitigating or exempting sanctions and leniency application procedures to encourage cartel participants to voluntarily come forward for more effective cartel enforcement.
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Major aspects of the Amended Leniency Regime are:
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Requirement for the Officers or Employees of the Leniency Applicant to Attend and Cooperate at the KFTC Hearing:
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To induce full cooperation from a leniency applicant, the Amended Regime expressly imposes the officers or employees of the leniency applicant a duty to attend the KFTC hearing, so that the KFTC Commissioners can make an accurate assessment on the applicant’s qualification for leniency status, and directly confirm the facts about the cartel activities at issue.
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The KFTC’s final decision on the leniency application considers whether the leniency applicant diligently cooperated with the KFTC’s investigation, and such cooperation now includes whether the officers or employees of the leniency applicant attended the hearing.
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2. Strengthened Non-Disclosure Obligation on Leniency Applicants:
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The Amended Leniency Regime requires leniency applicants not to disclose to third parties their cartel activities, and the fact that they applied for leniency. If this nondisclosure obligation is breached, the applicant will not be eligible for leniency.
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This is a change from the previous leniency regime, where compliance with the nondisclosure obligation was only one of several criteria for determining the leniency applicant’s cooperation status. Even if the leniency applicant did not comply with the nondisclosure obligation, it could still have obtained leniency status based on other criteria.
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The Amendment provides for two exceptions to the nondisclosure obligation: (1) if the disclosure is required under other laws or regulations; or (2) if the leniency applicant must inform a foreign government agency of its leniency application to the KFTC.
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Compared to the prior regime, we expect the KFTC to implement the Amended Leniency Regime in a more strict, but reasonable manner.
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