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4. Results: Answers
Cartels
10.
Tips and traps
10.1
What would be your recommendations to companies faced with a cartel investigation and what potential pitfalls would you highlight?
India

Answer ... A company that is the subject of (or is expecting) a cartel investigation should consider the following:

  • Conduct a thorough internal competition law audit to discover any breach of the Competition Act.
  • Seek legal advice on the feasibility of filing a leniency application if a breach has been discovered. Also, name individuals involved in the cartel in the application for a lesser penalty.
  • Set up an ombudsman programme for employees to make anonymous disclosures of any potential breach of the act and any evidence thereof.
  • Set up a robust competition compliance programme, if not already in place.

The following are potential pitfalls which a company under cartel investigation may face:

  • drainage of time, resource and focus on compliance with the directions and orders of the director general, the Competition Commission and the appellate authorities;
  • loss of reputation, decrease in stock value and trust deficit between the company, contractors, clients and shareholders;
  • financial loss due to penalties imposed and compensation claims;
  • the emergence of certain issues which were not alleged at the time of the start of the investigation; and
  • if privileged is not asserted, the director general’s access to and reliance on otherwise legally privileged documents.

For more information about this answer please contact: Vivek Agarwal from DMD® ADVOCATES
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Topic
Cartels