CCI Publishes Draft For Leniency Plus, Invites Comments From Stakeholders

Earlier, the Competition Act, of 2002 was amended by the Competition (Amendment) Act 2023, and the amended act introduced a ‘Leniency Plus Framework’.

Under the Leniency Plus program Companies already under investigation can make ‘full, true and vital disclosures’ about the existence of another cartel (second cartel) unknown to the CCI.

Each leniency applicant will be given a reduction in penalty up to 30 % for the first cartel.

In the case of second cartels, the first applicant to make a vital disclosure is eligible for up to a 100% reduction in penalty, followed by the second and third applicants who may be eligible for up to 50% and 30% reduction respectively.

“This is an important development since, traditionally, only horizontal anti-competitive agreements between businesses engaged in identical or similar trade would be captured under the ambit of a cartel. The Amendment Act provided a statutory basis to fix liability on facilitators of cartels and the draft regulations take that to a logical end,” said Nitika Dwivedi, partner, Shardul Amarchand Mangaldas & Co.

The applicants for this process may be any company or individual who is or was a member of the cartel. Such an application may be made before CCI receives the investigation report of the Director General (DG) in the first cartel. The procedure for the grant of Leniency Plus will be as per the Schedule II of Draft Regulations. Applicants under the Draft Regulations will also be allowed to withdraw a leniency application.

It's worth mentioning that CCI in its discretion shall decide matters of reduction of penalties, based on the quality and timing of information provided by the applicant. The commission will also consider whether they already possess any evidence and the overall facts and circumstances of the case.

Given the same, Stakeholders have to submit written comments on the Draft CCI (Lesser Penalty) Regulations 2023 within 21 (twenty-one) days from 16.10.2023 to 06.11.2023.

The comments can be provided by filling out the form at: https://cci.gov.in/stakeholders-topics-consultations

CCI (Lesser Regulations), 2023: https://cci.gov.in/images/stakeholderstopicsconsultations/en/draft-lesser-penalty-regulations1697431514.pdf

Amendment Act is available at: https://prsindia.org/files/bills_acts/acts_parliament/2023/The%20Competition%20(Amendment)%20Act,%202023.pdf