On 4 October 2012, the Ukrainian Leniency Procedure was finally
adopted by the Antimonopoly Committee of Ukraine (AMC), coming into
immediate effect. Unlike in some other jurisdictions, in Ukraine
leniency remains available after the AMC initiates an
investigation, but not after the so called "preliminary
conclusion" is issued (such preliminary conclusions are issued
at a very late stage of the investigation process, informing the
cartel members of the authority's formal position).
The new Leniency Procedure introduces the marker system, making
the procedure significantly more transparent, thereby giving
businesses something of a covenant if they indeed were the first to
'blow the whistle'. As an illustration, the marker issued
by the designated AMC's State Commissioners to the applying
undertaking's representative would warrant priority to the
first to "blow the whistle". What is more, applicants can
be awarded with the marker and continue their cartel activity with
a view of obtaining more evidence that would enable them to prove
For an applicant to be successful, it must:
disclose the cartel to the AMC;
before the other cartel participants;
providing the authority with enough information to prove the
existence of the cartel.
Similarly to the position in the EU, the 'first in' to
inform the AMC of the ongoing cartel will not qualify for leniency,
having informed the AMC thereof, the undertaking did not take
efficient measures to terminate it (unless it was motivated by
collecting more evidence);
it initiated or managed the cartel; or
it did not provide the AMC with all evidence or data in its
However, the Leniency Procedure fails to envisage the
possibility for a reduction in the fines that would otherwise have
been imposed on a cartel member in exchange for disclosure of
information on the cartel and cooperation with the AMC during its
investigation. The fact that a de jure procedure for reducing the
level of fines has been omitted remains a significant drawback that
will undoubtedly deter many potential whistleblowers.
Although a leniency program did not exist in Ukraine until now,
there are some sporadic examples of where undertakings that closely
collaborated with the AMC during its cartel investigations were
rewarded with significant fine reductions. For example, in August
this year, in a distortion of tender case in the construction
industry, two out of three cartel participants received relatively
hefty fines, amounting to EUR 38,000 and 30,000 respectively,
while the whistle blower was fined with a symbolic EUR 15. Also in
2012, in the so-called furniture cartel, which involved the members
of the Furniture Association "Mebeldrevprom", fines
amounting to approximately EUR 40 million were imposed (with the
highest imposed on a single undertaking amounting to approximately
EUR 16 million), while three undertakings that collaborated with
the AMC escaped with a meager fine of EUR 3,000.
Needless to say, the adoption of the Leniency Procedure is
expected to increase the popularity of leniency, thereby assisting
the AMC in collecting proper evidence to fight cartels.
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