US Department Of Justice Announces Incentives For Robust Antitrust Compliance Programs

Executive Summary. On July 11, 2019, Assistant Attorney General Makan Delrahim announced important changes in how the Antitrust Division of the US Department of Justice (Division) would make a charging decision in criminal antitrust cases. For decades, the Division had employed an all-or-nothing approach, granting corporate leniency to the first company to report and document wrongdoing. Under the Division's new policy, companies with robust compliance programs may be eligible for deferred prosecution agreements (DPAs)—even when they lose the race to report antitrust offenses. This policy change creates a significant new incentive for companies to implement robust antitrust compliance programs.

Background. The Division has exclusive authority to bring criminal charges against companies and individuals that engage in "hard core" violations of US antitrust law, such as agreements between competitors to fix prices, rig bids or allocate markets. Since 1993, the Division's Corporate Leniency Program has incentivized companies to provide the Division with information regarding criminal antitrust violations. In particular, the first company to confess to wrongdoing, fully cooperate with the Antitrust Division's investigation, and meet the other conditions specified in the Corporate Leniency Policy is eligible for corporate leniency (i.e., immunity from criminal charges for both the company and its employees and protection from treble damages in follow-on civil litigation).

The point of the Corporate Leniency Program was to create a race between companies to report violations. To emphasize the urgency around reporting, the Division has long insisted that any culpable company that "loses" the race plead guilty to a criminal charge—whether or not they had an effective compliance program. This policy was codified in the Department of Justice's Justice Manual, which stated that "credit should not be given at the charging for a compliance program" and that "the nature of some crimes, e.g., antitrust violations, may be such that national law enforcement policies mandate prosecution of corporations notwithstanding the existence of a compliance program."

The New Policy. Assistant Attorney General Delrahim announced four changes that take effect immediately:

The Justice Manual has been amended to delete the provision suggesting that credit will no longer be given for the existence of an antitrust compliance program. Now, prosecutors must consider the...