Project Title

Seminar on International Experience Regarding the Role of Leniency Programs in the Repression of Anti-Competitive Conducts - Highlighting Its Effectiveness in the Fight Against Cartels (the Secrecy with which it Operates is Broken) 

Project Year

2015   

Project Number

CPLG 02 2015A 

Project Session

Session 2   

Project Type

Standard 

Project Status

Completed Project   
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Project No.

CPLG 02 2015A 

Project Title

Seminar on International Experience Regarding the Role of Leniency Programs in the Repression of Anti-Competitive Conducts - Highlighting Its Effectiveness in the Fight Against Cartels (the Secrecy with which it Operates is Broken) 

Project Status

Completed Project 

Publication (if any)

 

Fund Account

APEC Support Fund 

Sub-fund

ASF: APEC's New Strategy on Structural Reform (ANSSR) 

Project Year

2015 

Project Session

Session 2 

APEC Funding

120,000 

Co-funding Amount

30,000 

Total Project Value

150,000 

Sponsoring Forum

Competition Policy and Law Group (CPLG) 

Topics

Competition Policy; Deregulation 

Committee

Economic Committee (EC) 

Other Fora Involved

 

Other Non-APEC Stakeholders Involved

 

Proposing Economy(ies)

Peru 

Co-Sponsoring Economies

Mexico; New Zealand; Viet Nam 

Expected Start Date

01/01/2016 

Expected Completion Date

31/12/2016 

Project Proponent Name 1

Lily Escobar (new Project Overseer wef November 2016) 

Job Title 1

Manager, Technical Cooperation and Institutional Relations 

Organization 1

INDECOPI 

Postal Address 1

Calle de la Prosa 104 San Borja, Peru 

Telephone 1

51-1 2247800-4601 

Fax 1

Not Applicable 

Email 1

lescobar@indecopi.gob.pe 

Project Proponent Name 2

Not Applicable 

Job Title 2

Not Applicable 

Organization 2

Not Applicable 

Postal Address 2

Not Applicable 

Telephone 2

Not Applicable 

Fax 2

Not Applicable 

Email 2

Not Applicable 

Declaration

Lily Escobar 

Project Summary

This Project is directly related to the APEC New Strategy of Structural Reform (ANSSR) Initiatives Against Anti-Competitive Practices for Ensuring an Open, Well-Functioning and Competitive Market. (Rank 1) 

This project will organize a two day workshop in Lima, Peru, in which members economies will exchange experience regarding their leniency programs in order to implement more effective mechanism against cartels.

The purpose of this seminar is to facilitate information sharing on leniency programs experiences among APEC member economies; in order to identify, evaluate, apply and improve best practices against cartels in the region.

The main objectives of this seminar are:

1) Exchange experiences and information on leniency programs in APEC Economies;

2) Identify best practices in leniency programs; and

3) Prepare a framework to improve the application of leniency program in APEC Economies.

Relevance

As it is well known, cartels and horizontal agreements impose significant costs to society and, particularly, to consumers, who are deprived from the capacity to choose better and cheaper products and services. For this reason, cartel detection and sanction of such behaviors have become a major goal for economies all over the world.

One of the most successful mechanisms that facilitate cartel detection is the establishment of a leniency program. Indeed, a well-functioning leniency program can destabilize and deter cartels by creating a permanent threat that any of its members may come forward to the authority in order to avoid the fine. Leniency programs are very important to stop cartels because the difficulty in stopping this conducts is its secrecy. Therefore, a leniency program can break the code of silence among the cartels’ members. Moreover, it makes investigations more efficient and effective. For example, according to Nathan Miller[1], since the establishment of a leniency program in the US, the rate of cartel formation was reduced by 59% and increased the rate of cartel detection by 62%.

Considering the importance of this tool, we recommend that the project address topics related with an adequate implementation of a leniency program, including, but not limited to, the following:

1) Design of an effective marker system, including the possibility of allowing anonymous markers

2) Interrelation between corporate leniency and individual leniency

3) Assessment of the duty of cooperation of a leniency applicant throughout a formal investigation

4) Reduction of fines for subsequent applicants

5) Benefits about the use of an amnesty plus/leniency plus system

6) Use of confidential information provided by leniency applicants

7) Use of waivers of confidentiality

8) Cooperation of antitrust agencies in international leniency cases 

Rank 1. This projects seeks to promote regional economic integration and is directly linked to ANSSR.


[1]    MILLER, Nathan. Strategic Leniency and Cartel Enforcement, American Economic Review, Vol. 99, No. 3, 750-768 (2009).

Objectives

1) Exchange experiences and information on leniency programs in APEC Economies;

2) Identify best practices; and

3) Prepare a framework to improve the application of leniency program in APEC Economies.

Alignment

In 2014, APEC Leaders in Beijing, China, stated “to meet our objective of strengthening the implementation of good regulatory practices, we will further enhance communications, exchanges and sharing experiences, and foster an open and transparent regulatory environment in our economies, according to individual economies’ needs and circumstances”.

In addition, as we mentioned before, this project is directly related to the APEC New Strategy of Structural Reform (ANSSR) Initiatives Against Anti-Competitive Practices for Ensuring an Open, Well-Functioning and Competitive Market, particularly by helping to facilitate more transparent and competitive markets, since the leniency policy proves very successful in fighting cartels.  The reductions of cartels increase the benefits of a competitive economy to consumers and stimulate the incorporation of new technologies to the production processes.  So there is a contemporary trend towards the enactment of laws that prevent the formation of such economic agreements.

APEC's Competition Policy and Law Group (CPLG) works to promote an understanding of regional competition laws and policies, to examine the impact on trade and investment flows, and to identify areas for technical cooperation and capacity building among member economies.

In order to fulfill the goals set forth by the CPLG, we believe that the exchange of experiences in the proposed forum will not only strengthen cooperation between APEC’s member economies, but will also allow antitrust agencies of each member economy to evaluate the efficacy of their own leniency policies.

TILF/ASF Justification

This project is sought through the APEC Support Fund, which supports capacity-building need for APEC developing economies in accordance with high-priority areas for economic and technical cooperation. As noted above, this project fit in line with the APEC New Strategy of Structural Reform (ANSSR) Initiatives Against Anti-Competitive Practices for Ensuring an Open, Well-Functioning and Competitive Market, particularly by helping to facilitate more transparent and competitive markets, since the leniency program proves very successful in fighting cartels

The projects aims to achieve, among others, betters understanding and/or acknowledgement in leniency programs. So there is a contemporary trend towards the enactment of laws that prevent the formation of such economic agreements. The sharing knowledge, best practices and experiences on leniency programs from advanced APEC economies and lessons learnt will be disseminated to developing APEC economies, contributing to further capacity enhancement those economies.

Beneficiaries and Outputs

Outputs: Outputs of the project include:

1) 1 Workshop for competition agencies, officials and private sector;

2) A document with best practices identified; and

3) A framework to improve the application of leniency in APEC Economies. 

Outcomes: Expected outcome of the project include:

1) Improved understanding / acknowledgement of the benefits of leniency programs;

2) Improvement of skills of regulators and business in identifying evidences of anticompetitives conducts; and

3) Experiences, best practices and knowledge on leniency programs, shared among APEC member economies

Beneficiaries: It is important to mention that many of APEC Member economies are aware of Competition Best Practices, but they often do not have the resources or knowledge-base to compare their laws and enforcement policies to these Best Practices, or to familiarize themselves with the jurisprudential and economic thinking behind them.  For this reason, knowledgeable staff from all APEC competition authorities or other entities with intimate knowledge of actual or draft competition laws and regulations will be invited to present self-assessments in-person, which will then be subject to discussion.

According to above mentioned, beneficiaries of this project include: i) senior officer with understandings of competition policy, ii) Senior working-level officials with experience on competition cases. iii) senior officer with understandings of competition policy joining the workshop will directly gain knowledge from best practices in leniency programs , iv) Senior working-level officials with experience on competition cases will also be benefited from joining the workshop, learning from best practice will enhance understanding and effective implementation of Leniency Programs and will be a great resource to extend their knowledge to those who work in relevant agencies. 

This project may strengthen the network among participants for better identifying cartels and fighting against them. 

APEC and Non APEC economies will also benefit from shares knowledge and experience regarding the role of leniency programs in the repression of anticompetitive conducts - highlighting its effectiveness in the fight against cartels.

Expert Speakers from competition authority in advanced APEC Economies and Non APEC will also be invited to exchange their experience. We are thinking to invite speakers from Mexico, Australia and United Kingdom for their experience in Leniency Programs. Since United Kingdom is not APEC economy, we will be coordinate on time with our Program Director. 

Finally,this project is aimed to the staff on competition agencies, ministries of economy and finance offices, among other public bodies and the APEC economies.

Dissemination

All outputs of this project will be communicated to the EC as well as the SOM. The Project Overseer will also make a brief presentation on the project outcome during EC1 2016. In addition the project output will be posted at INDECOPI’s website. We are also considering to implement the results of the project in our Leniency Guidelines.

Finally. the workshop materials such as power point presentations and the leniency guideline produced will be provided in electronic format and made available on the Documents Database from APEC meeting and in our Web Site.

Gender

This project will be implemented with an appropriate consideration on gender equity ensuring no discrimination against women. It is important to note that, during the planning phases, the project overseer has to coordinate with his supporting team, which is shaped by women team. In addition, gender balance will be taking into account as an important criterion for selecting both local officials to attend the Seminar. Therefore, we would try to ensure that 50% of each workshop representatives will be female.

Work Plan

1) December 2015:

a) Draft of the Seminar Agenda will be elaborated and circulated to economies for comment.

b) Incorporate the comments and finalize the agenda to reflect all interest by stakeholders.

2) January 2016 to March 2016:

a) Invite and confirm speakers for the seminar from international organization, research institutes and APEC economies. The invited speakers will be officers from The Competition And Markets Authority (UK), Bundeskartellamt and the Federal Trade Commission, Department of Justice and recognized academic institutions form the United States of America.

b) Promotion and dissemination from the seminar by email, INDECOPI’s web, and Official letters.

c) Send questionnaires seeking information on how APEC members economies expect the result of the seminar in order to applied in the workshop.

3) April-Jun 2016:

a) Invite participants from relevant APEC Ministries, agencies and research institutes in APEC economies members.

b) Confirmation of the event details.

c) Ground arrangement by the organizing committee (logistic and documentation).

4) August to October 2016: Implementation of the seminar.

5) November 2016: Upon conclusion of the seminar, event organizers will prepare with co sponsors, speakers and other participants to draft a report for the CPLG Group.

Risks

Estimated Date

Activity

Output

Risk

Management of Risk

Research paper and policy note

January – March 2016

Invite/confirm potential speakers

Experts invited and confirmed

Unavailability of experts

Work closely with co-sponsors and stakeholders to identify several alternatives of experts.

April-June 2016

Invite Participants

Number of participants

Dissemination not successful

Project overseer will strictly monitor and enforce data base (list of participants)

In order to support developing economies in case they cannot implement this type of program, we are going to send all the documentations resulting from the Seminar and support them by email for any misunderstanding. Since the implementation of a leniency program will not be possible for few economies, to know more about best practices will support them in their daily work on competition policy,

It is important to mention that one purpose of this seminar is to show to all APEC economies that Leniency Program can be used to deter anticompetitive behaviors. According to that, INDECOPI will share its experience acquired in last years in Leniency Program and its effectiveness to protect competition.

August-October 2016

Seminar

Seminar implemented

Participants/speakers do not show up or cancel at last minute (Low risk)

Project overseers will be in close contact with speakers and participants throughout the process to minimize any last minute cancelations.

Monitoring and Evaluation

Indicator to measure the progress include: 

1) At least 15 participants from different APEC economies

2) Send questionnaires seeking information on how APEC member economies expect the result of the seminar in order to apply in the workshop – Response rate is not less than 45%

3) Document with best practices Identifying:

a) Framework to improve the application of leniency in APEC Economies.

b) Evaluation forms will be distributed at the end of the workshop in order to assess its impact

Linkages

This Project is directly related to the APEC New Strategy of Structural Reform (ANSSR) Initiatives Against Anti-Competitive Practices for Ensuring an Open, Well-Functioning and Competitive Market, particularly by helping to facilitate more transparent and competitive markets, since the leniency policy proves very successful in fighting cartels. The reductions of cartels increase the benefits of a competitive economy to consumers and stimulate the incorporation of new technologies to the production processes.  So there is a contemporary trend towards the enactment of laws that prevent the formation of such economic agreements.

Sustainability

This seminar will help to economies to get experience from other economies to solve some leniency cases and learn about the treatment of this particular situation that have a positive effect around the world and the best practice to confronting anticompetitive conducts. Furthermore, the officials could promote leniency programs in their economies as an efficient way to fight against cartels and increase the strength of the competition agency.

We could create reports about leniency programs between beneficiaries. Also we can share decisions about some cases like examples of correct way to apply leniency programs. This exchange of information could give to participants some tools to develop their functions in a better way.

After the seminar, this knowledge could be used in their respective economies, to improve the solutions to these behaviors. In that way, we could observe the evolution in leniency programs around the world and how these affect the market and the repression of anticompetitive conducts.

This seminar is addressed to create awareness in the beneficiaries and show the benefits of leniency programs and we consider that this project will continue to have impact after the APEC funding through the following important tools. The first one is related to increase the expertise of the officers about conducting leniency programs. The second one is related to expect increasing the number of leniency programs presented by undertakings. It is important to note that the most important example of the commitment of Indecopi to strengthen its system to promote and protect the competition is the recent efforts taken towards the establishment of a simple, transparent and effective Leniency Program. In that context, the results of the seminar will be included in the Guidelines that the Technical Secretariat is elaborating. 

To sum up, there are the next steps to keep this project sustainable:- 

1) The project proposal is endorsed by the CPLG, including Peruvian stakeholders

2) Improve Leniency Program

3) Develop Leniency Program Best Practices and include in INDECOPI’s Guidelines

4) To organize a training course on Leniency Best Practices as the next project implemented.

Project Overseers

Mauricio Gonzales del Rosario, Manager of the Technical Cooperation and the Institutional Relations of INDECOPI.

Alicia Vilca Accinelli, Executive of the Technical Cooperation and the Institutional Relations of INDECOPI. 

Jesús Espinoza Lozada, Technical Secretary of the Defense of Free Competition Commission of INDECOPI.

Arturo Chumbe, Executive of the Defense of Free Competition Commission of INDECOPI.

Cost Efficiency

Not Applicable.

Drawdown Timetable

Not Applicable.

Direct Labour

Not Applicable.

Waivers

We would like to include Simultaneous Interpretation in order to have more impact to all the participants since the Seminar will be held, in Lima, Peru. So, we will need to include Simultaneous Interpretation for two days, 08 hours per day.

Are there any supporting document attached?

No 
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Created at 04/12/2015 11:51  by Lucy Phua 
Last modified at 26/05/2017 13:00  by Lucy Phua 
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Project No.

Project Title

Project Status

Publication (if any)

Fund Account

Sub-fund

Project Year

Project Session

APEC Funding

Co-funding Amount

Total Project Value

Sponsoring Forum

Topics

Committee

Other Fora Involved

Other Non-APEC Stakeholders Involved

Proposing Economy(ies)

Co-Sponsoring Economies

Expected Start Date

Expected Completion Date

Project Proponent Name 1

Job Title 1

Organization 1

Postal Address 1

Telephone 1

Fax 1

Email 1

Project Proponent Name 2

Job Title 2

Organization 2

Postal Address 2

Telephone 2

Fax 2

Email 2

Declaration

Project Summary

Relevance

Objectives

Alignment

TILF/ASF Justification

Beneficiaries and Outputs

Dissemination

Gender

Work Plan

Risks

Monitoring and Evaluation

Linkages

Sustainability

Project Overseers

Cost Efficiency

Drawdown Timetable

Direct Labour

Waivers

Are there any supporting document attached?

hdFldAdmin

Project Number

Previous Fora

Secretariat Comments

Reprogramming Notes

Consolidated QAF

Endorsement By Fora

PD Sign Off

Batch

Forum Priority

Committee Ranking Category

Committee Priority

PDM Priority

Priority Within Funding Category

Monitoring Report Received

Completion Report Received

PMU Field 1

PMU Field 2

PMU Field 3

On Behalf Of

Proposal Status

Originating Sub-Forum

Approval Status
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