Whistle Blowing

The Competition Commission runs a corporate leniency policy in terms of which a party which has been engaged in cartel conduct, i.e

• Price fixing;
• Dividing markets;
• Bid rigging,

can come forward and admit guilt.

Let’s have a look at Whistle Blowing in more detail

Provided the party which blows the whistle:

• is the first party to admit guilt to the Commission;
• fully co-operates with the Commission in prosecuting the other members of the cartel with which the collusion occurred;
• keeps its admission of guilt and application for leniency confidential from the other members of the cartel; and
• immediately ceases participation in the cartel,

then that party will not be fined for its involvement in the illegal activity.

It is important to note:

• A company that gets leniency can still be sued by parties which suffer loss as a result of the cartel behaviour. It is only shielded from a fine by the competition authorities.
• It is noteworthy that, even if the Competition Commission grants your company immunity from prosecution through its corporate leniency policy, this does not mean that the individual directors and managers will also qualify for immunity from criminal prosecution. It is thus very important that you speak to the company’s lawyers before taking any steps in this regard.
• This is a very important tool for the competition authorities and important for you to know because if you are or become aware of cartel conduct (price fixing, dividing markets, bid rigging) you must immediately make arrangements for legal advice to be taken so your company can apply for leniency.

There have been numerous instances where minutes have separated applications for immunity. If you do not act swiftly enough, another cartel member may beat you to apply, and your company will then be exposed to prosecution and penalty.