In October 2007, the Competition Bureau announced key
changes to its successful Immunity Program, which had been
introduced in 2000. Under the program, immunity from
prosecution is available to the first party to disclose
evidence of coordinated criminal anti-competitive activity such
as price-fixing agreements among competitors. The program has
been a highly effective enforcement tool, encouraging early
disclosure of competition offences that may otherwise be
difficult for the authorities to detect and prosecute.
The most significant change announced in October, following
a public consultation process, was the commitment to introduce
a formal leniency program in Canada for parties who do not
qualify for immunity. In other jurisdictions, second-in and
subsequent parties are afforded a declining scale of leniency
within certain ranges of discounts for fines (e.g., first-in
gets immunity; second-in can be eligible for up to 50 per cent
off its fine depending upon the utility of its cooperation;
third-in may be eligible for up to 30 per cent off its fine,
etc.). Certain guidelines may also govern the treatment and
sentencing of individuals and the number of individuals who may
be carved out of the corporate grant of leniency. At present in
Canada, no formal guidelines govern whether or how cooperation
would affect the fine or sentence to be imposed for those who
have lost the race for immunity. This aspect of the current
Canadian program arguably does not encourage second-in or
third-in parties to cooperate because there is no certainty
regarding how their cooperation would be treated in relation to
other parties to the offence.
In addition to the future introduction of a formal leniency
program, significant changes to the Immunity Program announced
in October included:
changes to the pre-conditions for a grant of immunity
— in the past, applicants were not eligible if they
were the "instigator" or "sole
beneficiary" of the conduct in Canada; now applicants
will be excluded if they "coerced" others to
replacement of the former two-step procedure involving a
provisional guarantee of immunity (PGI) and final immunity
agreement with a single conditional immunity agreement;
protection of current directors, officers and employees
from the corporate grant of immunity as long as they admit
participation in the alleged offence and cooperate with the
authorities; former directors, officers and employees of a
corporate immunity applicant will continue to be dealt with
on a case-by-case basis as the corporate immunity agreement
does not provide automatic protection; and
revocation of immunity for non-disclosure of other
competition-related offences limited to circumstances where
there is intentional non-disclosure or where no due diligence
is exercised by the immunity applicant.
There will be no formal "penalty plus" program
adopted in Canada. Under the US penalty —plus policy,
an applicant who applies for amnesty for one offence but fails
to disclose a second offence is subject to an increased penalty
for the second offence. In Canada, the Bureau will maintain its
existing policy of potential revocation of immunity for the
first offence and consideration of the non-disclosure as an
aggravating factor on sentencing for the second offence.
The recent changes also remove the requirement that an
immunity recipient provide restitution (which is ensured by
private actions for damages), confirm that the Bureau will not
pursue proactive immunity (i.e., contacting those it considers
may have useful information with an offer of immunity), and
indicate that the Bureau may disclose the recipient's
identity without notice or consent for the purpose of
administration or enforcement of the Competition
The content of this article is intended to provide a
general guide to the subject matter. Specialist advice should
be sought about your specific circumstances.
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The Canadian Competition Bureau issued a template document for use as a form of Consent Agreement, to be filed with the Competition Tribunal to resolve concerns the Bureau may have with proposed mergers.
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