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Office of Competition and Consumer Protection

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Leniency - new law for the penitent

< previous | next > 09.02.2009

Leniency - new law for the penitent

Price fixing is punishable. Do you want to avoid severe sanctions for participating in a prohibited agreement? Apply for leniency to get immunity or a reduction of fines. New opportunities will be available as of 24 February

In 2008, UOKiK carried out more than 40 proceedings concerning competition restricting agreements. Collusions regarding e.g. prices or dividing the market are the most harmful infringements of competition law. They are very difficult to detect due to their confidential nature. They have a negative impact on the economy, therefore, fines for their participants are severe - they may reach up to 10% of their annual revenue. The high fines may be avoided thanks to the leniency programme, which makes it possible for the antitrust authority to grant immunity or reduction of the fine applicable for participating in a cartel in exchange for evidence of the existence of a collusion and withdrawing from it. As of 24 February enterprises are going to be able to use new legal opportunities. On this day a new Regulation on the leniency programme as well as Guidelines on leniency - a practical guide for enterprises enter into force.

The most favourable solution being introduced is the possibility for cartel participants to submit abridged applications. An enterprise which wants to confess to participating in an illegal agreement will be allowed to submit the application even when it lacks of all the required information. This will allow the company to reserve itself "a place in the queue" of leniency applicants. The application will be accepted conditionally - the enterprise will be obliged to complete it within an appointed date. The solution is very important for applicants as it is only the first enterprise to report the cartel and deliver evidence for its existence which may expect to be granted immunity from fines. Those who come next may only expect reduction of financial sanctions - the second applicant by maximally 50%, the third -30 %, and the following - by up to 20% of the fine which would be imposed if they did not submit the leniency application. A long-term cartel participant will be able to estimate how much it may gain by withdrawing from the cartel.

In addition, the new regulations specify in more detail what information should be provided by leniency applicants. They should include information about the participants in the agreement, its duration, purpose, territory, etc.

It will now also be easier for participants of agreements involving international corporations to apply for leniency. If a cartel covers a territory not only of Poland but also of at least three other EU Member States, the participants will be able to submit a summary application to UOKiK. An applicant who has already started cooperating with the European Commission will be able to expect a lenient treatment in the event when the Polish antitrust authority takes up the case.

It will also be easier to contact the Office thanks to a special helpline: (+48 22) 55 60 555. Calling the number, a participant of an illegal agreement will obtain all information on the programme. Anonymous entrepreneurs calling to the Office will be able to learn for example if they meet the requirements to apply for leniency.

UOKiK is just launching the most extensive ever campaign popularising knowledge on competition protection among entrepreneurs. Starting from 9 February, TV advertisements promoting the leniency programme are being shown on the TV in Poland, including in particular channels dealing with business issues. In addition, the President of UOKiK is going to send letters to 500 largest enterprises operating in Poland informing them about the programme.

A tangible proof for the profitability of the participation in the leniency programme is the case of Castorama. In 2006, the information provided by the company allowed UOKiK to disrupt the agreement made by Polifarb Cieszyn-Wrocław, a paint and varnish producer, with several building materials supermarkets. Castorama benefited by saving many million Polish zloty: while the other cartel participants were ordered to pay fines reaching even PLN 34 million, or almost PLN 110 million in total, the leniency applicant paid a fine of only PLN 50 thousand.

Companies which would like to make use of the new solutions may submit their leniency applications:

  • In person at the premises of UOKiK in Warsaw (pl. Powstańców Warszawy 1, Department of Competition Protection) or by post,
  • By e-mail: [SCODE]bGVuaWVuY3lAdW9raWsuZ292LnBs[ECODE],
  • Orally for the record prepared by an employee of UOKiK.

Additional information:
Małgorzata Cieloch, Spokesperson for UOKiK
Pl. Powstańców Warszawy 1, 00-950 Warsaw, Poland
Tel. (+48 22) 827 28 92, 55 60 106, 55 60 430
faks (+48 22) 826 11 86
E-mail: [SCODE]bWNpZWxvY2hAdW9raWsuZ292LnBs[ECODE]

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