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

MARKER SYSTEM OF JFTC’S LENIENCY PROGRAM

Mini Plenary Session 4bICN Cartel Workshop 2011Wednesday, 12 October

Setting up or reforming a leniency Setting up or reforming a leniency programmeprogramme

- What makes a leniency policy - What makes a leniency policy successful –successful –

Takujiro KonoTakujiro KonoSenior Officer for Leniency Program, Investigation BureauSenior Officer for Leniency Program, Investigation Bureau

Japan Fair Trade Commission Japan Fair Trade Commission

LENIENCY PROGRAM OF JAPAN FAIR TRADE COMMISSION

Mini Plenary Session 4bICN Cartel Workshop 2011Wednesday, 12 October

Setting up or reforming a leniency Setting up or reforming a leniency programmeprogramme

- What makes a leniency policy - What makes a leniency policy successful –successful –

Takujiro KonoTakujiro KonoSenior Officer for Leniency Program, Investigation BureauSenior Officer for Leniency Program, Investigation Bureau

Japan Fair Trade Commission Japan Fair Trade Commission

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

・・・

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Setting up or reforming a leniency programme

- What makes a leniency policy successful –Mini Plenary Session 4b

ICN Cartel Workshop 2011Wednesday, 12 October

OVERVIEW OF JFTC’S LENIENCY PROGRAM

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4

100%100%immunityimmunity

30%reduction

50%reduction

1st Applicant1st Applicant

2nd Applicant2nd Applicant

30%reduction

AfterAfterBeforeBefore

Up to3 Applicants

the initiation of the JFTC the initiation of the JFTC investigationinvestigation

Up to 5 applicants

30%reduction

33rdrd to 5 to 5thth ApplicantApplicant

Criminal accusation NOT filed by JFTC (Applicant firm and its individuals)




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

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DISQUALIFICATION REQUIREMENTS

<JFTC’s Leniency Program>

Both for immunity and reductionReports 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

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ADDITIONAL REQUIREMENTSFOR 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 5Value of Reporting Must includes the facts other than already ascertained by JFTC

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JFTC’S EXPERIENCE (1)

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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

２６７９７４８５８５１３１４８０

FY 05 06 07 08 09 10 Total

The number of price-fixing cartels and bid-riggings etc

１７９２０

１１２２１

０８９

Leniency applied cases (published) ０６１

６８２１７５８

Leniency applied companies (published)

０１６３７

２１５０１

０１３４

※The period of FY2005 is between Jan. 4 .2006 and Mar. 31.※In 2010, the program was revised to introduce joint application and to expand the number of applicants.





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After the introduction of the leniency program （ Since Jan. 2006 ）　→ The size of price-fixing cartel cases enlarges.

Strict measures against price-fixing cartels in the large market fields

Main fieldsMarket 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) 　 FY2010 82.35\/$ FY2009 90.09\/$ FY2008 96.38\/$




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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 investigationSetting up or reforming a leniency programme




THANK YOU FOR YOUR ATTENTION !

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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

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Marker Period

FORM NO. 1: WRITTEN REPORT

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1. Goods or Services Targetedby 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

FORM NO. 2: WRITTEN REPORT (1)

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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.

FORM NO. 2: WRITTEN REPORT (2)

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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 ofEntrepreneur

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

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

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THANK YOU FOR YOUR ATTENTION !

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Documents

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