Both corporations and individuals in Australia can apply for immunity in relation to cartel conduct. The application can be made in relation to civil or criminal proceedings. It is generally referred to as ‘first in’ immunity as it is only available to the first entity to disclose cartel conduct.1 It is not necessary to have the required information at the initial stage of the immunity application.
Corporations in civil proceedings
In order for a corporation to be eligible for conditional immunity, it must satisfy the following criteria:
- they must be or have been a party to the cartel;
- they must admit that their conduct may constitute a contravention of the Competition and Consumer Act 2010 (CCA);
- they are the first of the cartel to apply for immunity;
- they have not coerced others to participate in the cartel;
- they have ceased or indicate they will cease involvement in the cartel;
- the admissions are a truly corporate act;
- they have provided full, frank and truthful disclosure and have cooperated fully and expeditiously while making the application; and
- they must also undertake to continue to act in this way.2
Additionally, related corporate entities and officers/employees of the corporation may apply for derivative immunity if the corporation qualifies for the above. In conjunction with the above criteria, immunity is only available if the ACCC has not yet received written legal advice that they have reasonable grounds to institute proceedings in relation to that cartel.3
Individuals in civil proceedings
Aside from the ‘corporate act’ criterion above, individuals must meet the same criteria as corporations in order to be eligible for conditional immunity in relation to cartel conduct.
The CDPP and the ACCC have agreed to facilitate immunity for criminal proceedings at the same time as immunity for civil proceedings as they recognise the need to maximise certainty within cartel cases.4 If the ACCC is satisfied that an applicant is eligible for immunity, they can make a recommendation to the CDPP that immunity from prosecution also be granted. Although the CDPP will consider this recommendation, they ultimately make an independent assessment. If they too are satisfied the applicant meets the criteria, they will write a letter of comfort which recognised the ‘first-in-status’.5 In order to maintain this status, applicants must continue to provide full, frank and truthful disclosure whilst also maintaining confidentiality regarding details of the investigation.
The corporation or individual seeking immunity must first request the placement of a marker. A marker effectively preserves the ‘first-in-status’ and allows the applicant a limited time (generally 28 days) to gather information and demonstrate they meet the conditional immunity criteria. Once the information has been gathered, the applicant must provide a proffer. This essentially means the applicant is required to give the ACCC the information they have acquired. A proffer can be made orally or in writing.
If the ACCC determines there is sufficient information, the applicant will be requested to sign a waiver in regards to their identity and the information provided for each affected jurisdiction. It is important to note that the ACCC endeavours to protect any confidential information provided along with the applicant’s identity; however, sometimes this cannot be achieved. If a criminal prosecution is to proceed, the ACCC will make a recommendation to the CDPP that criminal immunity also be granted to the applicant.
Finally, the ACCC is then at liberty to grant conditional immunity to the applicant. Final immunity is only granted if the applicant maintains eligibility and continues to provide full, frank and truthful disclosure throughout the remainder of the investigation.
In circumstances where an applicant is not eligible for ‘first in’ immunity, they are still able to cooperate if they desire to. If a party chooses to cooperate, the ACCC can make submissions to the Court regarding the cooperation provided. Generally, the Courts afford more lenient treatment to parties that have provided cooperation in relation to cartel conduct.
While cooperating with the ACCC, a party may discover the existence of a second cartel that is unrelated to the first. In these circumstances, the party can apply for conditional immunity for the second cartel and ‘amnesty plus’ for the original. Essentially, ‘amnesty plus’ is a recommendation to the Court by the ACCC for a further reduction in penalty in relation to the first cartel. Parties who wish to seek ‘amnesty plus’ should initially apply for a marker in relation to the second cartel.6
- Australian Competition and Consumer Commission, ‘ACCC immunity and cooperation policy for cartel conduct’ (September 2014).
- Ibid., 4.
- Ibid., 7.
- Ibid., 14.