Academic journal article University of Queensland Law Journal

The Temple of Leniency: Thoughts Inspired by the Work of Laura Guttuso

Academic journal article University of Queensland Law Journal

The Temple of Leniency: Thoughts Inspired by the Work of Laura Guttuso

Article excerpt

I INTRODUCTION

Sadly, I never had the pleasure of meeting Laura Guttuso. We had corresponded extensively about her research and publication. Loyola University Chicago School of Law and the Institute for Consumer Antitrust Studies were supposed to host Laura for a Research Fellowship in the spring of 2016 to assist in her work on her PhD dissertation at the University of Queensland. The plan was for Laura to spend some weeks in Washington, DC on a similar fellowship through the Antitrust Section of the American Bar Association and then come to Chicago to work with me and the other professors and practitioners who comprise the Institute faculty and advisory board on issues of comparative competition law and enforcement. (1)

Instead we learned the tragic news that Laura fell ill upon arrival in Washington and passed away shortly thereafter. This short article mourns her loss, celebrates her contributions and accomplishments as a scholar, and comments on one of her final publications which appeared as a chapter in a fascinating book entitled Anti-Cartel Enforcement in a Contemporary Age: Leniency Religion ('Leniency Religion'). (2) In this article, I discuss many of the general themes presented in the book as a whole and then turn to the specifics of Laura's chapter on the role of leniency and the intersection of private and public enforcement of competition law. She will be missed by all those who knew her and those who had the privilege to know her work.

II THE TEMPLE OF LENIENCY

Leniency Religion is an interesting, timely, and important book. There is a tremendous variety of economic, legal, philosophical, and practical perspectives on the role of leniency policies in modern cartel enforcement in the US, the EU, and in other jurisdictions. The authors hold diverse views and represent a broad number of jurisdictions and perspectives on the important topic of leniency and amnesty policies. It has been well received, well reviewed, and is a must for scholars and practitioners interested in this issue. (3)

Leniency policies are formal policies which competition authorities use to incentivize cartel members (and potentially other types of antitrust conspirators) to confess to the authorities. The cartel members must then cooperate going forward in return for some combination of mandatory or discretionary immunity or more lenient treatment for the entity and/or the individuals involved in the antitrust violation. In return, the competition authority receives direct evidence tending to establish an antitrust violation they were previously unaware of, or not yet in a position to challenge.

The leniency application may be enough for the authorities to obtain authorization for a search warrant or dawn raid to obtain enough further information to convict or find liable the other conspirators in the cartel. Frequently the other cartelists plead guilty, enter into civil settlements with the competition authorities, and/or seek to cooperate as well in return for more limited forms of leniency. An effective amnesty or leniency programme should also provide both specific and general deterrence for other would-be antitrust law breakers.

In the United States, there has been a formal amnesty and leniency programme for both businesses and individuals since the early 1990s. It has been responsible for the detection (and hopefully deterrence) of numerous significant national and international cartels including the infamous international vitamins cartel. (4)

In the United States, leniency will be granted to a corporation or other business entity reporting illegal activity before an investigation has begun, if the following six conditions are met:

1. At the time the corporation comes forward to report the illegal activity, the Antitrust Division of the US Justice Department has not received information about the illegal activity being reported from any other source;

2. …

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