New Frontiers of Antitrust 2012

Compliance Programs:

How efficient are they really ?

An interview with Bruno Lasserre

The New Frontiers of Antitrust 2012 conference will take place in Paris on 10 February, at the seat of the French National Assembly. Concurrences Review has interviewed Bruno Lasserre, the President of the French Competition Authority, who will participate in a panel dedicated to compliance programmes, together with representatives of other stakeholders (Cecilio Madero, Deputy Director General at DG COMP, Oliver Bethell, Competition Counsel of Google, and François Brunet, Partner at Cleary Gottlieb Steen & Hamilton, Paris).

Concurrences: Why do competition authorities care about corporate compliance programmes and how long have they done so?

Bruno Lasserre: Compliance is actually not a brand new topic for the Autorité de la concurrence or for competition authorities in general. The traditional tools mobilized by competition authorities have always had as their final objective the stimulation of voluntary compliance. Deterrent and proportional fines are of course the preliminary condition for companies to make an effort to abide by competition rules. As for cartels, leniency programmes have been designed to feed distrust amongst cartel members and to discourage breaches of competition law. In a more positive way, commitments amend the companies’ behaviour to drive them fast along the road to compliance. Unilaterally, competition authorities may also call for compliance by offering guidance through exemption regulations, guidelines, opinions or sector inquiries. Oliver Bethell will certainly tell you about his own experience in the wake of the Autorité’s sector inquiry on online advertising and the meetings with the Autorité on the issues identified that have taken place regularly since then. 

The novelty of this topic rather lies in the recent rise of corporate compliance programmes, that the Autorité already observed in 2007 when it commissioned an independent study that was conducted in association with representatives of all relevant stakeholders (business federations, company lawyers, antitrust bar, academics, etc.). Above all, a debate emerged very recently on whether or not competition authorities should offer incentives to firms that commit to set up and implement robust compliance programmes, and on how to design these incentives. Over its last two sessions, the OECD pioneered a new reflection on these two key questions, making a significant contribution toward the Autorité’s own reflection.

If this new approach is taken on board, it may constitute a real leap forward to build a genuine competition culture on a win-win basis. But in my view, there are two prerequisites. First, incentives and rewards should be balanced and proportionate on both sides. I mean that competition authorities cannot reward lip-service compliance programmes and are legitimate to put forward substantial and procedural requirements towards firms that apply for a favourable treatment. Second, no one is expected to switch sides. Only firms may set their own conduct and handle internal and external risks. Conversely, it is no wonder that most competition authorities, including the Autorité, consider that the fact that the reality and seriousness of a breach of competition law are not affected by the fact that the infringing firm had previously put in place a compliance programme. So it is necessary for competition authorities to design alternative routes that would accommodate this “new approach” to corporate compliance programmes and embed them adequately in competition enforcement, depending on the specific institutional and legal background and corporate culture in each jurisdiction.

Concurrences: How do you map the progress of the “new approach” to compliance programmes and the position of the various stakeholders in the panel ?

Bruno Lasserre: I suppose François Brunet, as a lawyer, and Oliver Bethell, as an in-house counsel, will share their experience of their relations with top management on compliance issues, and that they will explain how due diligence efforts may be developed in a continuous fashion, rather than on a one-off basis, on the occasion of a buy-out, and what the key drivers of an efficient programme are.

I am sure they will also seize the opportunity to comment on the policy documents that were just released by the Autorité and the European Commission, which will be represented by Cecilio Madero. We published on 14 October a draft framework document on compliance programmes together with draft guidelines on settlements, complementing one another. DG COMP issued on 24 November a brochure entitled: “Compliance matters”, and sub-titled “what companies can do better to respect EU competition rules”.

In the specific context of commitments accessory to settlements, the Autorité is willing to reward the set up or the revamping of a compliance programme if it is a substantial, trustworthy and verifiable step. We are thus the first competition authority to make such a binding commitment in a document that firms will be able to rely on. In so doing, the Autorité supports compliance programs that truly put the future conduct of firms on the right track, on a voluntary basis. The maximum 10% reduction of the final fine imposed by the settlement decision may only be granted if certain conditions are satisfied. They have to do with the management, content and inclusiveness of the compliance programme, but also on its actual implementation, especially disciplinary sanctions on rogue employees and the submission of leniency applications whenever a cartel infringement is detected.

On a case-by-case basis, other competition authorities that have a marked interest in compliance programmes, such as the U.S. DOJ or the Canadian Competition Bureau, have suggested alternative ways of taking these into account in their enforcement practice, e.g. by closing cases that involve firms with robust compliance programmes, for those able to prioritize, or by including compliance programmes in their approach to leniency or settlements.

As for the European Commission, its approach is reflected in the brochure I referred to earlier. The intrinsic benefits of competition, the various risks entailed by non-compliance - from administrative fines to actions for damages, including reputational damage – make up, together with predictable law enforcement and positive guidance on best practices and “tips” on compliance programmes, adequate leverage to foster compliance programmes.

Concurrences: Will you disclose further information on the Autorités’ new approach to compliance programmes during the conference ?

Bruno Lasserre: Yes, the conference will be an excellent occasion to make a presentation of the final guidelines on settlements and of the framework document on compliance programmes.

We will take stock of the findings of the public consultation, which runs until 14 December 2011, and we will have gathered direct input from stakeholders from the roundtable organized by the Autorité on 20 December 2011 in the premises of ENA in Paris.

So, when the time of the “New frontiers” conference comes, I will be able to explain whether we found concurring and relevant suggestions for amendments and what final decisions were made by the Autorité.

See the full conference agenda and speakers list on 

nfa2012.eventbrite.com

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