1. Marker system of jftc’s Leniency Program
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
Mini Plenary Session 4b
ICN Cartel Workshop 2011
Wednesday, 12 October

2. Leniency Program of Japan Fair Trade Commission
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
Mini Plenary Session 4b
ICN Cartel Workshop 2011
Wednesday, 12 October

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 ・
Setting up or reforming a leniency programme - What makes a leniency policy successful –
Mini Plenary Session 4b
ICN Cartel Workshop 2011
Wednesday, 12 October 3

4. Overview of Jftc’s Leniency program
1st Applicant
the initiation of the JFTC investigation
Before
After
100%
immunity
2nd Applicant
Up to
3 Applicants
50%
reduction
3rd to 5th Applicant
30%
reduction
30%
reduction
30%
reduction
Criminal accusation NOT filed by JFTC (Applicant firm and its individuals)
Up to 5 applicants 4
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 4

5. Qualification requirements
<JFTC’s Leniency Program>
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 4th and 5th application, for application after the investigation begun)
Self-report is due the twentieth day from the first day of the 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 5

6. Disqualification requirements
<JFTC’s Leniency Program>
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
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

7. Additional requirements for Application after investigation starts
<JFTC’s Leniency Program>
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
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

8. JFTC’s Experience (1)
Number of Applications after the introduction of the leniency program（Since Jan. 2006）
Number of Cases
 Leniency applications are important information sources of price-fixing cartels, etc. FY
2005
2006
2007
2008
2009
2010
Total
Applications ２６ ７９ ７４ ８５
１３１
４８０
※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. FY 05 06 07 08 09 10
Total
The number of price-fixing cartels
and bid-riggings etc １７ ９ ２０ １１ ２２ １０ ８９
Leniency applied cases (published) ０ ６ １６ ８ ２１ ７ ５８
Leniency applied companies (published) ３７ ５０
１３４
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

9. JFTC’s Experience (2)
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＄
※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 9

10. JFTC’s Experience (3)
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 10

11. Thank you for your attention !
Setting up or reforming a leniency programme - What makes a leniency policy successful –
Mini Plenary Session 4b
ICN Cartel Workshop 2011
Wednesday, 12 October 11

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

14. Form No. 1: Written report
○ Summary of the Violative Act to be Reported
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.
Setting up or reforming a leniency programme - What makes a leniency policy successful –
Mini Plenary Session 4b
ICN Cartel Workshop 2011
Wednesday, 12 October

15. Form No. 2: Written report (1)
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.
Setting up or reforming a leniency programme - What makes a leniency policy successful –
Mini Plenary Session 4b
ICN Cartel Workshop 2011
Wednesday, 12 October

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

17. features of JFTC’s 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 JFTC’s Rule)
Not only to the 1st applicant
As long as applying prior to the investigation starting date
Even the 2nd , 3rd 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. 1
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 !
Setting up or reforming a leniency programme - What makes a leniency policy successful –
Mini Plenary Session 4b
ICN Cartel Workshop 2011
Wednesday, 12 October