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MARKER SYSTEM OF JFTCS LENIENCY PROGRAM Mini Plenary Session 4b ICN Cartel Workshop 2011 Wednesday, 12 October Setting up or reforming a leniency programme.

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Presentation on theme: "MARKER SYSTEM OF JFTCS LENIENCY PROGRAM Mini Plenary Session 4b ICN Cartel Workshop 2011 Wednesday, 12 October Setting up or reforming a leniency programme."— Presentation transcript:

1 MARKER SYSTEM OF JFTCS LENIENCY PROGRAM Mini Plenary Session 4b ICN Cartel Workshop 2011 Wednesday, 12 October Setting up or reforming a leniency programme - What makes a leniency policy successful – Takujiro Kono Senior Officer for Leniency Program, Investigation Bureau Japan Fair Trade Commission

2 LENIENCY PROGRAM OF JAPAN FAIR TRADE COMMISSION Mini Plenary Session 4b ICN Cartel Workshop 2011 Wednesday, 12 October Setting up or reforming a leniency programme - What makes a leniency policy successful – Takujiro Kono Senior Officer for Leniency Program, Investigation Bureau Japan Fair Trade Commission

3 KEY ELEMENTS OF AN EFFECTIVE LENIENCY PROGRAMME Substantial payoff for priority Clarity, transparency, and certainty Application accepted even after investigation starts Severe penalties for non-applicant(s) Confidentiality of application information 3 Setting up or reforming a leniency programme - What makes a leniency policy successful – Mini Plenary Session 4b ICN Cartel Workshop 2011 Wednesday, 12 October

4 OVERVIEW OF JFTCS LENIENCY PROGRAM %immunity 30% reduction 50% reduction 1st Applicant 2nd Applicant 30% reduction After Before Up to 3 Applicants the initiation of the JFTC investigation Up to 5 applicants 30% reduction 3 rd to 5 th Applicant Criminal accusation NOT filed by JFTC (Applicant firm and its individuals) Setting up or reforming a leniency programme - What makes a leniency policy successful – Mini Plenary Session 4b ICN Cartel Workshop 2011 Wednesday, 12 October

5 QUALIFICATION REQUIREMENTS For immunity The first firm to comes forward before the first day of the investigation Not commit further acts on or after the first day of the investigation For reduction 2nd to 5th firm to self-report Not commit further acts on and after the first day of the investigation Submit reports and documents unknown to JFTC (for 4 th and 5 th application, for application after the investigation begun) Self-report is due the twentieth day from the first day of the investigation 5 Setting up or reforming a leniency programme - What makes a leniency policy successful – Mini Plenary Session 4b ICN Cartel Workshop 2011 Wednesday, 12 October

6 DISQUALIFICATION REQUIREMENTS Both for immunity and reduction Reports and documents submitted not contain false information Not submit false reports or false materials responding to JFTC's additional requests Not coerce others to commit the infringement or blocked others from ceasing Not disclose the fact of application to third parties without justifiable reasons 6 Setting up or reforming a leniency programme - What makes a leniency policy successful – Mini Plenary Session 4b ICN Cartel Workshop 2011 Wednesday, 12 October

7 ADDITIONAL REQUIREMENTS FOR APPLICATION AFTER INVESTIGATION STARTS Application Deadline Due the twentieth day from the inception of the investigation Maximum Number of Applications Three The number of applications including before and after the investigation are not more than 5 Value of Reporting Must includes the facts other than already ascertained by JFTC 7 Setting up or reforming a leniency programme - What makes a leniency policy successful – Mini Plenary Session 4b ICN Cartel Workshop 2011 Wednesday, 12 October

8 JFTCS EXPERIENCE (1) 8 Number of Applications after the introduction of the leniency program Since Jan Number of Cases Leniency applications are important information sources of price-fixing cartels, etc. FY Total Applications FY Total The number of price-fixing cartels and bid-riggings etc Leniency applied cases (published) Leniency applied companies (published) The period of FY2005 is between Jan and Mar. 31. In 2010, the program was revised to introduce joint application and to expand the number of applicants. Setting up or reforming a leniency programme - What makes a leniency policy successful – Mini Plenary Session 4b ICN Cartel Workshop 2011 Wednesday, 12 October

9 JFTCS EXPERIENCE (2) 9 After the introduction of the leniency program Since Jan The size of price-fixing cartel cases enlarges. Strict measures against price-fixing cartels in the large market fields Main fields Market size for one year FY Hot-dip galvanized steel sheets 2109 million US 2009 Electric wire 2159 million US 2010 Vinyl chloride pipes 1531 million US 2008 Optical fiber cable 574 million US 2010 Exchange rate(Trade Statistics of Japan) FY \/$ FY \/$ FY \/$ Setting up or reforming a leniency programme - What makes a leniency policy successful – Mini Plenary Session 4b ICN Cartel Workshop 2011 Wednesday, 12 October

10 10 Multi-agency coordination and cooperation Previous Cases (such as Marin Hose Case) Pay full attention to matters of Confidentiality Identity of Leniency Applicant, Information from Leniency Applicant Legal obligation The chairman, the commissioners and the staff members of the JFTC shall not divulge or make surreptitious use of trade secrets of entrepreneurs which came to their knowledge in the course of their duties. (Article 39 of the Antimonopoly Act). Information Exchange in the area of, among other things: General matters of the violation (relevant market, duration, etc.) Schedule of the dawn raids, investigation methods, etc. Results of the dawn raids, Progress of investigation Setting up or reforming a leniency programme - What makes a leniency policy successful – Mini Plenary Session 4b ICN Cartel Workshop 2011 Wednesday, 12 October JFTCS EXPERIENCE (3)

11 THANK YOU FOR YOUR ATTENTION ! 11 Setting up or reforming a leniency programme - What makes a leniency policy successful – Mini Plenary Session 4b ICN Cartel Workshop 2011 Wednesday, 12 October

12 12 Setting up or reforming a leniency programme - What makes a leniency policy successful – Mini Plenary Session 4b ICN Cartel Workshop 2011 Wednesday, 12 October

13 OVERVIEW OF JFTCS MARKER SYSTEM JFTCs Rules on Reporting and Submission of Materials Regarding Immunity from or Reduction of Surcharges Form No.1 Reporting Name and address of the applicant Products concerned Basic information of the conduct (such as geographical area, parties, duration) No need to describe in detail, nor to attach documents JFTC notifies the applicant of, the order of submission the deadline by which (1) reporting the facts regarding the violative act by using Form No.2 and (2) submission of materials should be completed 13 Setting up or reforming a leniency programme - What makes a leniency policy successful – Mini Plenary Session 4b ICN Cartel Workshop 2011 Wednesday, 12 October Marker Period

14 FORM NO. 1: WRITTEN REPORT 14 Setting up or reforming a leniency programme - What makes a leniency policy successful – Mini Plenary Session 4b ICN Cartel Workshop 2011 Wednesday, 12 October 1. Goods or Services Targeted by the Said Act 2. Description of the Said Act (1) (2) 3. The Time of the First Implementation (The Time of Termination) ______ (Year) ______ (Month) ______ (Day) (until ______ [Year] ______ [Month] ______ [Day]) * The written report shall be prepared in Japanese. Summary of the Violative Act to be Reported

15 FORM NO. 2: WRITTEN REPORT (1) 15 Setting up or reforming a leniency programme - What makes a leniency policy successful – Mini Plenary Session 4b ICN Cartel Workshop 2011 Wednesday, 12 October 1. Summary of the Violative Act to be Reported (1) Goods or Services Targeted by the Said Act (2) Description of the Said Act a. b. (3) Name or Title and Address or Location of Other Entrepreneur(s) Participating in the Said Act (4) The Time of the First Implementation (The time of Termination) ______ (Year) ______ (Month) ______ (Day) (until ______ [Year] ______ [Month] ______ [Day]) * Yellow cells: Substitution of an oral report for a written report could be possible.

16 FORM NO. 2: WRITTEN REPORT (2) 16 Setting up or reforming a leniency programme - What makes a leniency policy successful – Mini Plenary Session 4b ICN Cartel Workshop 2011 Wednesday, 12 October 2. Position Titles and Names of Executives or Employees Who Have Involved in the Said Act at the Reporting Entrepreneur Current Position Title and Divisions Name Position Title and Divisions Name at Time of Involvement (The Time of the Position) Name 3. Names and Others of Executives or Employees Who Have Involved in the Said Act at Other Entrepreneur(s) Participating in the Said Act Name of Entrepreneur Current Position Title and Divisions Name Position Title and Divisions Name at Time of Involvement (The Time of the Position) Name 4. Other Matters for Consideration 5. Submission of Materials No. Title of MaterialDescription of Materials Content (Summary) Notes

17 FEATURES OF JFTCS MARKER SYSTEM JFTC has No discretion about whether or not to grant marker Virtually All applicant is notified by JFTC of the deadline to perfect the marker (according to JFTCs Rule) Not only to the 1 st applicant As long as applying prior to the investigation starting date Even the 2 nd, 3 rd and subsequent applicants are granted marker(s) The Order of reporting and submission is decided according to the time when JFTC receives the Form No Setting up or reforming a leniency programme - What makes a leniency policy successful – Mini Plenary Session 4b ICN Cartel Workshop 2011 Wednesday, 12 October

18 THANK YOU FOR YOUR ATTENTION ! 18 Setting up or reforming a leniency programme - What makes a leniency policy successful – Mini Plenary Session 4b ICN Cartel Workshop 2011 Wednesday, 12 October


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