christoph klahold - importance and challenges of at
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Importance and Challenges of Antitrust Compliance for Large Corporations
Dr. Christoph Klahold - Chief Compliance Officer ThyssenKrupp AG
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Importance and Challenges of Antitrust Compliance for Large CorporationsDr. Christoph Klahold, December 3, 20122
Importance of Antitrust Compliance for ThyssenKruppRail Cartel (2011)
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Importance and Challenges of Antitrust Compliance for Large CorporationsDr. Christoph Klahold, December 3, 20123
Reporting system
Training
Group Policies/ Guidance Notes
WhistleblowerHotline
Sanctions for violations
Inform & Advise Identify Report & Act
Compliance audits
Compliance advice
Compliance culture
Compliance organization
Tone from the Top/the Middle Compliance Commitment
Integrate Compliance in business processes
Risk profile
Structure and elements of ThyssenKrupp Compliance Program
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Importance and Challenges of Antitrust Compliance for Large CorporationsDr. Christoph Klahold, December 3, 20124
Major Challenges for Large Corporations
• Legal privilege for in-house counsel
• Sanctions against employees• Antitrust leniency vs. criminal
sanctions• Consideration of Compliance
Programs
• „Zero Tolerance“• Access to file• Damage claims
by competition authorities
Challenges regarding
private enforcement
Compliance Commitment
Challenges for internal
advice/ investigations
Challenges during
administrative proceedings
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Importance and Challenges of Antitrust Compliance for Large CorporationsDr. Christoph Klahold, December 3, 20125
Major Challenges for Large CorporationsNecessity to Coordinate Different internal and external Proceedings
Administra-tive
Proceeding
Leniency Application Dawn Raid Cartel
Proceeding Fine
Criminal Investigation Dawn Raid Court
Proceeding Sentence
Private Enforcement
Access to File
Court Proceedings Damages
Internal Measures
Internal Investigation
Employment Sanctions
Labor Law Dispute
Civil Court Dispute for Damages
Damage Claims
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Importance and Challenges of Antitrust Compliance for Large CorporationsDr. Christoph Klahold, December 3, 20126
Major Challenges for Large CorporationsLegal Privilege
The ECJ has confirmed in Akzo Nobel that in order to benefit from legal privilege vis-à-vis the European Commission, a communication has to emanate from an independent lawyer, i.e., a lawyer that is not bound to the client by a relationship of employment
The ECJ has confirmed in Akzo Nobel that in order to benefit from legal privilege vis-à-vis the European Commission, a communication has to emanate from an independent lawyer, i.e., a lawyer that is not bound to the client by a relationship of employment
Since Commission Regulation 1/2003 increased necessity for companies to conduct self-assessments in the area of antitrust law
Since Commission Regulation 1/2003 increased necessity for companies to conduct self-assessments in the area of antitrust law
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Importance and Challenges of Antitrust Compliance for Large CorporationsDr. Christoph Klahold, December 3, 20127
Major Challenges for Large CorporationsLegal Privilege
Incentive for companies not to document antitrust law advice by in-house lawyers and compliance officers as this may create an additional hazard by documenting the situation
Incentive for companies not to document antitrust law advice by in-house lawyers and compliance officers as this may create an additional hazard by documenting the situation
Companies are forced to constantly involve outside legal counsel for all major antitrust law issues.Companies are forced to constantly involve outside legal counsel for all major antitrust law issues.
The in-house legal departments need to be involved in all legal aspects and situations, in particular in those that are problematicThe in-house legal departments need to be involved in all legal aspects and situations, in particular in those that are problematic
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Importance and Challenges of Antitrust Compliance for Large CorporationsDr. Christoph Klahold, December 3, 20128
Major Challenges for Large CorporationsSanctions against Employees
How should companies deal with employees involved in a
cartel?
How should companies deal with employees involved in a
cartel?
Zero Tolerance!Compliance Commitment of companies, Public opinion and many public authorities expect strict sanctions.
Zero Tolerance!Compliance Commitment of companies, Public opinion and many public authorities expect strict sanctions.
Internal leniency/incentives to report and cooperate.Cooperation of involved employees is essential during complete investigation to submit leniency application and in some cases competition authorities even expect and require companies to ensure such cooperation
Internal leniency/incentives to report and cooperate.Cooperation of involved employees is essential during complete investigation to submit leniency application and in some cases competition authorities even expect and require companies to ensure such cooperation
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Importance and Challenges of Antitrust Compliance for Large CorporationsDr. Christoph Klahold, December 3, 20129
Major Challenges for Large CorporationsAntitrust Leniency vs. Criminal Sanctions for Employees
Leniency benefitfor companygranted byEuropean
Commission
Individual employee
prosecuted bynational public
prosecutor
Best interest ofthe company:
full cooperationto obtainleniency
Interest ofindividual employee:
defense againstcriminal
prosecution
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Importance and Challenges of Antitrust Compliance for Large CorporationsDr. Christoph Klahold, December 3, 201210
Major Challenges for Large CorporationsConsideration of Compliance Programs in the Setting of Fines
“If a company which has put a compliance program in place is nevertheless found to have committed an infringement of EU competition rules, the question of whether there is any positive impact on the level of fines frequently arises. The answer is: No”(Source: European Commission, Compliance Matters, November 2011)
“If a company which has put a compliance program in place is nevertheless found to have committed an infringement of EU competition rules, the question of whether there is any positive impact on the level of fines frequently arises. The answer is: No”(Source: European Commission, Compliance Matters, November 2011)
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Importance and Challenges of Antitrust Compliance for Large CorporationsDr. Christoph Klahold, December 3, 201211
Major Challenges for Large CorporationsConsideration of Compliance Programs in the Setting of Fines
Compliance efforts often helpless against conduct by individual employees that knowingly and willfully try to circumvent the internal rules (criminal energy)
Compliance efforts often helpless against conduct by individual employees that knowingly and willfully try to circumvent the internal rules (criminal energy)
Many national competition authorities already incorporated this concept in their fining guidelines (e.g., US, France, UK)Many national competition authorities already incorporated this concept in their fining guidelines (e.g., US, France, UK)
Could provide an additional and “more tangible” argument to implement and intensify the Compliance EffortsCould provide an additional and “more tangible” argument to implement and intensify the Compliance Efforts
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Importance and Challenges of Antitrust Compliance for Large CorporationsDr. Christoph Klahold, December 3, 201212
Major Challenges for Large CorporationsProtection of Files
Protection of leniency documents essential for decision of a company whether or not to apply for leniency.Protection of leniency documents essential for decision of a company whether or not to apply for leniency.
Private antitrust
enforcement
Effectiveness of leniency program
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Importance and Challenges of Antitrust Compliance for Large CorporationsDr. Christoph Klahold, December 3, 201213
Major Challenges for Large CorporationsCommission allowed to ask for damages
European Commission is acting both as judge and claimant.European Commission is acting both as judge and claimant.
Firewall necessary between case team responsible for the cartel investigation and division of the European Commission in charge for damage claims
Firewall necessary between case team responsible for the cartel investigation and division of the European Commission in charge for damage claims
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Importance and Challenges of Antitrust Compliance for Large CorporationsDr. Christoph Klahold, December 3, 201214
Thank you for your attention!
Any Questions?