under the AMA in Japan ICN CWG SG1 3 rd call series Tuesday 10 February Takujiro Kono Senior Investigator Investigation Bureau Japan Fair Trade Commission 2 Dual Sanctioning System under the AMA ID: 689287
Download Presentation The PPT/PDF document "Non- Discretionary Administrative Sancti..." is the property of its rightful owner. Permission is granted to download and print the materials on this web site for personal, non-commercial use only, and to display it on your personal computer provided you do not modify the materials and that you retain all copyright notices contained in the materials. By downloading content from our website, you accept the terms of this agreement.
Slide1
Non-Discretionary Administrative Sanctions under the AMA in Japan
ICN CWG SG13rd call series Tuesday, 10 February
Takujiro KonoSenior Investigator, Investigation BureauJapan Fair Trade Commission Slide2
2
Dual Sanctioning System under the AMA
Hardcore Cartel
Administrative
procedure
or
Criminal procedure
?
Administrative procedure
･
Indirect compulsory investigation
･
Aiming at administrative
measures(cease and desist
order & surcharge payment order
)
Criminal procedure･Compulsory investigation with court permit･Aiming at criminal accusation
<Policy Statement>The JFTC will actively accuse････ Vicious and serious cases which have a significant adverse impact on the public ･ Repeat offendersBut the first leniency applicant would not be accused.
Worthy of Accusation
After
criminal Accusation
Criminal Accusation
Administrative Measures
・Surcharge payment order ・Cease and desist order
-PPO can’t indict without JFTC’s accusation-Consultation between JFTC and PPO
・Criminal penalty
Companies
Indictment
Public Prosecutors Office
(PPO)
Individual
sSlide3
3
Non-Discretionary Administrative Surcharges (by JFTC)Criminal Fines(by Court)JFTC’s Surcharge Payment Order (to companies only)JFTC MUST order: except for (1) The 1
st leniency applicant, (2)Small amounts (3)Statute of limitation (5 years).Automatically calculated: AFFECTED SALES(*) during the period multiplied by FIXED RATE(**)(*) Affected Sales must be calculated exactly (Accumulation of historical sales data during the period of Max 3 years)(**) Basic Rate:10% Recidivism, Leading Role:15% Early termination:8% Retail Business:3%
Wholesale Business:2%, etc.
(***) Half of criminal fines is deducted
Court’s Criminal
Judgment
(to companies and individuals)
DISCRETIONARY FACTORS:
Accusation Phase
(JFTC’s discretion under policy statement (see previous page))
Indictment Phase(PPO’s discretion)
Judgment Phase(the court’s discretion(*))(*)Elements considered in past judgmentsSize of the companyOrganized violation Impact on the public
Leading role
Amount of unfair/private profitDegree of cooperation with investigationSocial sanctionReason for involvement in violationStatement of self-review
Having a criminal record etc.Characteristics of Non-Discretionary Administrative SanctionsSlide4
4
Administrative Cease and Desist Order (by JFTC)JFTC’s Cease and Desist Order (to companies only)JFTC MAY order toCease and desist the conducts, and/or Take any
OTHER MEASURES NECESSARY to eliminate cartelDISCRETIONARY FACTORS:Whether or not to orderTo which companies Elements considered in past administrative cases (JFTC can order to past violation, if necessary, within 5 years of statute of limitations.)
Long history of cartel offence
Cartel ended not because of their own decision but because merely of being investigated by competition authorities
Other elements concerning possibility of repeating the violation
Contents of order
For Example,Make employees thoroughly informed about guidelines on compliance with the AMA
Resolution of
Board of Directors on confirmation that
cartel
had been terminatedPersonnel changes (Specific individuals transferred from certain sales functions) etc.Slide5
Administrative Surcharges (approx.)
Criminal Penalties (fines and imprisonment)Industrial and Automotive Bearings (Cartel: 2012)Two companies:509 million to 7.2 billion in Japanese Yen Corporate fines: JPY 180 million to 380 million
Imprisonments: 1year to 1year and 2months (suspended sentence) *as of Oct. 2014, one company and two individuals in trialGalvanized Steel Sheets (Cartel: 2009)Three companies: JPY 3.7 billion to 6.3 billionCorporate fines: JPY 160 million to
180 million
Imprisonments: 10months to 1year (
suspended sentence)
Steel Bridge Construction (Bid
Rigging: 2006-2008)44 companies: JPY 4 million to
854 million
Corporate
fines
:
JPY 160 million to 640 millionImprisonments: 1year to 2year and 6months (suspended sentence)5
Comparison
of Administrative Surcharges and Criminal Fines in Real CasesSince surcharges are calculated automatically, the amount of surcharges can be far larger than that of fines.Slide6
Q: Is it possible to abstain from Imposing surcharges?
A: JFTC has no discretion to abstain from impose surcharges.Q: What is the basis for the calculation? Are indirect sales counted/considered to prevent under-deterrence?A: Surcharges are calculated from the cartelized sales amounts during the period of violation (Max 3 years) multiplied by calculation rates. Indirect sales
are out of the basis of the calculation. Q: Is it possible to reduce surcharges, depending on the degree of cooperation? A: JFTC has no discretion to take into account the degree of cooperation of company in setting surcharges. Under the leniency program, fixed rate reduction is available for leniency applicants who meet the conditions of the program; but JFTC has no discretion to evaluate the degree of cooperation and the value of evidence submitted in the leniency program.
Q:
Is
it possible to reduce surcharges, depending on sanctions already imposed by another agency to prevent over-deterrence?
A: JFTC is not allowed to
take into account sanctions imposed by another agency, except for corporate criminal
fines imposed by domestic court decisions.
6
No Discretion in JFTC SurchargeSlide7
7Thank you for your attention !