Korea’s Cartel Leniency Regime

Leniency programs have been used quite successfully around the world to battle cartels. The same holds true in Korea. Since its introduction in 1997, Korea’s leniency program has become the most important and effective means of cartel discovery. Korea’s leniency program was updated in 2005 which improved predictability and reliability.

From 2005 to 2018, Korea’s antitrust regulator – the KFTC- applied fines in 557 cartel cases. Among those cases, 335 cartels were discovered using its Leniency Program. Or in other words, over 60 % of the cartel cases from 2005-20018 that resulted in fines were discovered because of the leniency guidelines.

What is leniency? Basically, it’s a system of partial or total exoneration from penalties that would otherwise be applicable to a cartel member which reports its cartel membership to a competition or antitrust enforcement regulator. It has been used quite effectively in the US, EU and other jurisdictions. Some jurisdictions, such as the EU uses the leniency program to offer a reduction in fines up to 100%.

Korea’s leniency program, is similar to the US and EU. Of course unlike the EU, which only levies administrative fines in the case of a cartel, the KFTC may refer a cartel case to the Prosecutor’s Office for criminal prosecution, which makes a leniency deal to avoid prosecution quite tempting for many cartel members.

For more information on the Leniency Regime in Korea, please contact me or the antitrust practice group of Lee & Ko.

No comments yet.

Leave a comment

Your email address will not be published.