DOJ's New Antitrust Charging Policy to Reward Companies' Good Faith Compliance Efforts
It contains two parts, guiding prosecutors in their evaluation of compliance programs at both the charging and sentencing stage of investigations.
July 12, 2019 at 04:05 PM
4 minute read
The original version of this story was published on Corporate Counsel
Now general counsel have a new reason to make sure their companies have a quality compliance program in place—the companies may face fewer or lesser charges from federal antitrust prosecutors.
During a speech at New York University Law School on Thursday, Assistant Attorney General Makan Delrahim announced what he called “a new model for incentivizing antitrust compliance programs.” For the first time, he said the U.S. Department of Justice's Antitrust Division will consider whether a company has a good faith compliance program in place at the charging stage in criminal antitrust investigations.
“The Antitrust Division is committed to rewarding corporate efforts to invest in and instill a culture of compliance,” Delrahim said.
He explained that the division's leniency program provides the “ultimate credit” for effective compliance programs and that it recently has also started crediting prospective compliance efforts at sentencing.
Now Delrahim said it will consider a company's good faith compliance efforts while making charging decisions. He added the division updated its prosecuting manual, deleting a statement saying credit should not be given for compliance at the charging stage.
For the first time, he said the division also has published a guidance document that focuses on evaluating compliance programs in the context of criminal violations of the Sherman Act.
It contains two parts, guiding prosecutors in their evaluation of compliance programs at both the charging and sentencing stage of investigations. He said it also provides compliance officers and the public greater transparency of the division's compliance analysis.
Delrahim said in the past a company had to win the race for leniency in DOJ's all-or-nothing approach.
“I believe the time has now come to improve the Antitrust Division's approach and recognize the efforts of companies that invest significantly in robust compliance programs. In the words of our former Deputy Attorney General Rod Rosenstein, '[t]he fact that some misconduct occurs shows that a program was not foolproof, but that does not necessarily mean that it was worthless. We can make objective assessments about whether programs were implemented in good faith.'”
He said the new approach came, in part, from suggestions at a public workshop held last year with in-house counsel, outside counsel and international enforcers.
“Therefore, effective immediately,” Delrahim said, “the Antitrust Division will: (1) change its approach to crediting compliance at the charging stage; (2) clarify its approach to evaluating the effectiveness of compliance programs at the sentencing stage; and (3) for the first time, make public a guidance document for the evaluation of compliance programs in criminal antitrust investigations.”
In a May speech, Delrahim hinted that such a change was coming. Again citing feedback from the workshop, he said, “We can and must do more to reward and incentivize good corporate citizenship.”
Based on that speech, antitrust lawyers at Paul, Weiss, Rifkind, Wharton & Garrison wrote an article suggesting robust compliance programs could provide “significant new benefits to companies facing criminal antitrust exposure.”
The article stated, “The potential value of a strong antitrust compliance program—beyond its inherent good-governance value—has been increased, perhaps very much, and it behooves companies to revisit their compliance programs to ensure that they are 'effective and robust,' thoughtfully designed, up-to-date and diligently implemented.”
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