WuW Publishes Steger Article on Compliance Management Systems for US Antitrust Violations

February 2016

Germany’s leading antitrust journal WuW (Wirtschaft und Wettbewerb) has published Frankfurt associate Dr. Jens Steger’s article describing the latest developments in US antitrust compliance management systems (CMS) in light of United States of America vs. Kayaba Industry Co. Ltd. The article also connects these developments to potential German legislative actions affecting CMS.

In Kayaba, the employees of Kayaba Industry Co (KYB), a Japanese car supplier with operations in the US, were accused of rigging bids and price-fixing for auto parts. After completing its investigation, the US Department of Justice (DOJ) proposed that the court set the fine to be imposed against KYB to a drastically reduced amount of US $62 million. The initial fining range recommended under the Sentencing Guidelines was between US $103.7–207.4 million.

The DOJ highlighted certain reasons why it recommended reducing the fine, notably, that the company from the start of the investigation:

  • cooperated and worked together quite well with the authorities concerning the clarification of the antitrust violations, and
  • quickly put in place a comprehensive and effective CMS.

On September 16, 2015, KYB entered into a plea agreement with the DOJ accordingly.

Steger notes the DOJ proposal’s significance, coming as it did after several years of general discussions in which the US Department of Justice (DOJ) revisited and reviewed the disparity in CMS treatment with regard to antitrust law. After a possible solution was outlined in advance through two highly observed speeches given by DOJ members, the DOJ then recommended that Kayaba receive a fine reduction.

Steger concludes that this change in the DOJ policy presents an opportunity. He advocates that clients either check existing CMS or build a CMS that takes into account the strict requirements of the US authorities in order to align correctly for future developments. A CMS that meets such requirements can not only prevent antitrust violations, but can also help lead to a significant reduction of a possible antitrust fine. Moreover, he says the German legislator should take the above developments into account when considering the revision of the German Act against Restraints of Competition (ARC) within this year.

» Read the article (p. 49).

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