Commission adopts new leniency policy for companies which give information on cartel
The European Commission on Wednesday took another important step to uncover and suppress price-fixing pacts and other hard-core cartels. The Commission unanimously adopted a new leniency policy that creates greater incentives for companies to blow the whistle on the most serious violations of antitrust rules. Under the new rules the Commission will grant total immunity from fines to the first company to submit evidence on a cartel unknown to, or unproved by the Commission. The leniency policy updates a previous 1996 document. "Detection and prosecution of cartels is one of my top priorities," European Competition Commissioner Mario Monti said, adding: "The 1996 leniency policy played an important role in uncovering and punishing secret cartels in the last five years. The new policy will create even greater incentives to denounce this scourge of the economy which has companies making illicit profits at consumers' expense".
Secret cartels are the most serious violation of competition rules since they invariably result in higher prices. Whether they take the form of price-fixing or market-sharing agreements, the allocation of production quotas or the rigging of bids, they harm European industry and consumers. Such illicit behaviour makes raw materials and components more expensive and, in the long term, leads to a loss of competitiveness and reduced employment. That is why they are expressly prohibited in Article 81 of the European Union treaty.
The detection, prohibition and punishment of cartels is one of the highest priorities of the Commission in the field of competition policy.

POSTED BY:-
SHILPI KUMARI
PGDM-3rd sem