1. Interplay of public and private enforcement – cartel sanctioning and deterrence ICN Cartel Working Group SG 1 call series 15 September 2015
Marc Braithwaite,
Assistant Director, Competition & Markets Policy
Competition and Markets Authority

2. Overview
Public enforcement and private damages actions primarily serve different purposes and are therefore complementary
Need to ensure that public enforcement and private actions enhance rather than undermine each other
Role of public authorities in facilitating compensation?
Interaction between cartel fines and compensation

3. Purposes of public enforcement and private actions (1)
Public enforcement focused on
Detecting, examining and bringing anti-competitive activity to an end
Imposing sanctions for infringements, to punish and deter future infringements
Private damages focused on
Compensating those who have suffered harm as a result of infringements
 The two are therefore complementary

4. Purposes of public enforcement and private actions (2)
BUT, each can also contribute to the objectives of the other
Public enforcement can facilitate private actions, e.g. through
Stimulating follow-on actions
Clarifying the law
Private damages actions can
Contribute to deterrence through increasing the overall cost of infringing
Address anti-competitive activity in those cases not / only partially addressed by public enforcement

5. Need to ensure that public enforcement and private actions enhance each other
Key issues include:
(1) Maintenance of leniency incentives – protection of leniency documents; joint and several liability
(2) Access to authorities’ files – should not prejudice authority investigations or be overly burdensome to authorities
 Both addressed in EU Damages Directive
(3) Role for authorities in private actions – should be relatively limited and not divert significant resources from core enforcement role (more on this later)
(4) Advocacy / amicus role for competition authorities in appropriate cases (underpinned by notification and intervention powers)

6. Role of public authorities in facilitating compensation?
Detecting and establishing infringements to facilitate follow-on actions (already mentioned)
New power in UK for competition authorities to approve voluntary redress schemes
Limited authority role, concerned largely with approving the process by which voluntary compensation is devised
Detailed compensation determined by a Board of independent experts
May be treated as a mitigating factor leading to a penalty reduction (up to 20%) for offering compensation in certain cases – intended to incentivise voluntary provision of redress

7. Interaction between cartel fines and compensation
Given primarily different roles of public enforcement and private damages actions, cartel fines and damages should not in principle greatly affect one another
Nevertheless, some potential interactions:
May be appropriate to treat compensation as a mitigating factor in limited cases (e.g. new UK power mentioned above)
Private damages rather than public enforcement might be the means of punishing and deterring infringements in exceptional cases – exemplary damages (Devenish, Cardiff Bus)

8. Conclusion
Important to manage public and private interactions given their complementary roles
A number of recent significant changes to the EU and UK private actions landscape
Potential for more effective private actions is welcome
However, also potentially new challenges in ensuring that public and private parts of the competition regime work well together

9. Interplay of public and private enforcement – cartel sanctioning and deterrence ICN Cartel Working Group SG 1 call series 15 September 2015
Marc Braithwaite,
Assistant Director, Competition & Markets Policy
Competition and Markets Authority