7 - The Law and Policy on Cartels and Leniency in Korea

Summary

This chapter argues that the adoption of the leniency programme in Korea is proof of considering any kind of price-fixing agreements as the supreme evil in society. Since its adoption, the leniency programme has contributed to nearly 55 per cent of all detected cartels. The leniency programme is attractive in its conceptualisation, because of high rewards for a limited number of firms and its conditions that are transparent and predictable. Furthermore, the chapter argues that private actions and criminal sanctions are not necessarily detrimental to a leniency application in Korea. Both are very rare and, in the case of criminal sanctions, there is a court judgment that leniency applicants should be excluded from the indictment. To further improve the leniency programme, the chapter suggests weakening the ineligibility of recidivists to apply for leniency and introducing penalty plus, whereby the sanction increases if a firm refrains from disclosing participation in another cartel, and an omnibus question, whereby a leniency applicant is asked to report information on other forbidden practices it is aware of.