Since central and south America (henceforth Latin America), as an economically important region, is progressing to joining the developed world, the improvement of competition policies becomes of greater importance for this region. The underlying reason is that competition policies and programs enable the benefits of economic developments along with market liberation. Furthermore, they do also facilitate other public policies and the enforcement of competition laws. Hence, it is important to promote competition compliance programmes.
As part of its efforts to assist Latin American countries in developing legislation as well as establishing competition authorities among others, UNCTAD commissioned the Center for Competition Law and Compliance (henceforth “CCC”) at the Zürich University of Applied Sciences (henceforth “ZHAW”) to investigate how compliance is developing in the practice of competition authorities and courts in Latin America.
The study will provide empirical evidence and recommendations on:
- Status quo regarding whether compliance programs are considered by authorities and courts in South and Central America at all when assessing penalties in cases of legal infringements, and if so, to what extent.
- Illustration of international Best Practices from different countries, institutions, and jurisdictions.
- Practical recommendations for action as voluntary guidance and aid for the respective authorities, as well as to support measures in cooperation with and on behalf of companies.
- Phase 1: Data collection of status quo through a structured questionnaire
- Phase 2: Analysis of responses
- Phase 3: Findings and recommendations
Current Phase of Implementation
The project is at Phase 3.
A structured questionnaire was created and sent to the competition authorities in South America. A total number of 15 out of 17 authorities participated in the study.
- The majority of the authorities surveyed (87%) provide support in the implementation of compliance programs. The authorities surveyed use a mix of different tools, such as
- Approximately the half of the authorities surveyed take compliance programs into account when calculating the fine reduction. The prerequisite for the recognition of compliance efforts is mostely that the compliance efforts were already made before proceedings were initiated.
- Most of the countries surveyed intend to promote compliance efforts yet further in the future.
- 64% of the authorities surveyed, state that they have sufficient resources and know how to promote compliance measures for companies, e.g., introduction of compliance programs. Furthermore, 93 % of the interviewed competition authorities surveyed already have cooperation partnerships with other stakeholders. Finally, all participants have indicated to be interested in a collaboration with potential future cooperation partners in this regard.
- Practical steps to assess strengths and weaknesses of a compliance program
- Implementation of the antitrust law
- Code of conduct
- Ongoing management commitment
- Compliance risk assessment
- Compliance cost assessment
- Practical steps to organize the resources
- Compliance team
- Reporting to Company Board or Management Committee
- Adequate Resources
- Practical steps to build and maintain the know-how
- Training program
- System of control and monitoring
- Disciplinary system
- Practical steps to ensure the control
- Due Diligence in M&A
Prof. Dr. Patrick L. Krauskopf
Attorney (Zurich | New York)
Zurich University of Applied Sciences (ZHAW), School of Management and Law, Center for Regulation and Competition