- Has your national competition authority published guidelines on competition compliance programmes (“CCPs”)? If so, what are the key components of an effective CCP?
- Are there any recent cases in your jurisdiction where the NCA/competent courts have discussed the impact of CCPs?
- What arguments have been taken into account in relation to a CCP? Has the fact that a company has a CCP been assessed in terms of the effort made or the results achieved, i.e. the efficiency of the programme? Is the focus on future changes in CCPs or on existing programmes?
- Has the role of the management and/or employees of the company been assessed with respect to preventing, participating in, detecting and reporting violations, or remediating violations? Is there a link between the role of the company's management and/or employees and an effective CCP?
- Has the fact that an undertaking has a CCP been helpful in reducing a fine for an infringement of competition law? What facts, arguments or commitments were used to justify the reduction and what is the maximum reduction that can be granted? If a reduction is not granted, why not?
- Are CCPs (their adoption or updating) used as evidence for "self-cleaning" measures when an economic operator risks being excluded from a public procurement procedure for collusive behaviour?
- Please indicate any additional considerations / rules, trends that are important in your country in relation to CCPs.
- Are there legal developments on the horizon in relation to CCPs?
jurisdiction
1. Has your national competition authority published guidelines on competition compliance programmes (“CCPs”)? If so, what are the key components of an effective CCP?
The Ukrainian national competition authority, the Antimonopoly Committee of Ukraine (the “Ukraine NCA”), has not yet adopted or published guidelines on competition compliance programmes (“CCPs”) in Ukraine.
2. Are there any recent cases in your jurisdiction where the NCA/competent courts have discussed the impact of CCPs?
There have been no recent cases where the Ukraine NCA or competent courts have discussed the impact of CCPs. Relevant practice is yet to be developed. In general, during its antitrust investigations, the Ukraine NCA tends to review various internal documents of companies, such as commercial policies and similar documents. If a contradiction between a company’s actual actions and its internal policies is identified, and the authority deems it appropriate, the Ukraine NCA may use this to support its position on an infringement.
Although there is no relevant enforcement practice directly related to CCPs thus far, CCPs have been actively discussed in Ukrainian antitrust circles for some time, including in the Ukraine NCA. For example, in November 2021, former Deputy Head of the authority stated that making a CCP a mandatory legal requirement was not supported by the Ukraine NCA, as this practice is uncommon in leading countries. She also stressed that during her time as a state commissioner in the Ukraine NCA, which she took on in April 2021, no company has approached the Ukraine NCA seeking a fine reduction on the grounds of the implementation of a CCP. The former deputy head, however, noted that this instrument has a right to exist, as this demonstrates the company’s commitment to cooperation, and in certain cases implemented CCPs could indeed serve as a basis for reducing fines for infringers.
3. What arguments have been taken into account in relation to a CCP? Has the fact that a company has a CCP been assessed in terms of the effort made or the results achieved, i.e. the efficiency of the programme? Is the focus on future changes in CCPs or on existing programmes?
No relevant practice available so far.
4. Has the role of the management and/or employees of the company been assessed with respect to preventing, participating in, detecting and reporting violations, or remediating violations? Is there a link between the role of the company's management and/or employees and an effective CCP?
As stated above, CCPs have not been in the spotlight of either the courts or the Ukraine NCA, and thus there is no relevant practice from the respective bodies. In general, the Ukraine NCA and the courts tend not to consider such elements as intent when qualifying infringements, attributing the behaviour of the management and employees of a company to the company itself. We are unaware of any recent cases where a company succeeded in convincing the Ukraine NCA or courts that it could not be held liable for the actions or omissions of its management/employees, e.g. when those contradicted the company’s internal policies. Furthermore, we are also unaware of any recent cases where similar arguments were raised at all. Practice regarding this issue is yet to be developed.
Considering Ukrainian law and practice, if a company cooperates with the Ukraine NCA during its proceedings and takes active steps to report and/or remediate a violation, depending on the circumstances of the case and the procedural instruments used, the company may achieve either: (i) the closure of the case without being fined; or (ii) a reduction in the fine. The first scenario might occur if the company, e.g. fulfils the Ukraine NCA’s recommendations or becomes the first successful applicant within a leniency procedure, thereby obtaining full immunity from a fine. The second scenario could take place if the company, e.g. succeeds in obtaining reduction in a fine through leniency or settlement procedures, or as a result of cooperating with the authority during proceedings.
For either of the above scenarios to happen, effective participation by the management and employees of the company in preventing, detecting, reporting, and remediating infringement is crucial. CCPs could be a valuable tool to establish these processes properly.
5. Has the fact that an undertaking has a CCP been helpful in reducing a fine for an infringement of competition law? What facts, arguments or commitments were used to justify the reduction and what is the maximum reduction that can be granted? If a reduction is not granted, why not?
The Ukraine NCA is now determining fines for competition law infringements based on the recently adopted Procedure for determining the amount of a fine imposed for violation of legislation on protection of economic competition approved by the Order of Ukraine NCA No. 22-rp dated 14 December 2023 (the “Procedure”). The Procedure establishes specific criteria to be taken into account when imposing fines, including a list of mitigating circumstances, the presence of which may result in a reduction in the fine. The existence of CCPs as such is not listed among these circumstances. In turn, mitigating circumstances are defined rather broadly and include: (i) termination of infringement before the Ukraine NCA’s statement of objections; (ii) cooperation with the Ukraine NCA that contributes to clarifying the circumstances of the case or detecting signs of other competition law infringements, including those committed by others; and (iii) remediating the infringement. A CCP that effectively works at least in detecting and remediating infringements might play an important role in ensuring that the above mitigating circumstances appear.
6. Are CCPs (their adoption or updating) used as evidence for "self-cleaning" measures when an economic operator risks being excluded from a public procurement procedure for collusive behaviour?
There is no publicly available practice so far. Considering existing Ukrainian legislation and the Ukraine NCA’s approach not to close a bid rigging case without fines if infringements can be proven, the only potential way for a company involved in bid rigging to avoid a three-year public procurement ban in Ukraine would be to obtain full immunity under the leniency procedure. A CCP, if adequately drafted and implemented—especially regarding monitoring and reacting to behaviour containing signs of infringement—can be a valuable instrument in obtaining such immunity.
Conversely, outside full immunity under leniency, relying on CCPs (their adoption or updating) as evidence for “self-cleaning” will unlikely allow a three-year ban to be avoided, but it may affect the Ukraine NCA’s approach towards determining the amount of fine and may be viewed by the latter as a mitigating circumstance.
7. Please indicate any additional considerations / rules, trends that are important in your country in relation to CCPs.
As previously reported, in 2023 Ukraine launched the first stage of a comprehensive competition law reform. Although CCPs have not been included in the legislative changes, procedures for reviewing competition law infringements and the Ukraine NCA’s powers related to, e.g. dawn raids, have undergone significant changes, triggering the necessity to adopt/amend CCPs which would account for the legislative changes
Among others, the first stage of Ukrainian competition law reform saw the introduction of settlement procedures for anticompetitive concerted practices and abuse of dominance, as well as the modernisation of the leniency procedure. Following this modernisation, Ukrainian leniency procedure now envisages not only full immunity for the first applicant that reports anticompetitive concerted practices, as it was previously, but also enables a reduction in the fines for subsequent applicants up to 50%, depending on their position in the queue.
To benefit from a 15% fine reduction, a company must admit the infringement, terminate it, and remediate it. To benefit from leniency, a company must supply the Ukraine NCA with substantial evidence of the infringement, cease participating in the infringement, except in cases when such participation is needed to ensure integrity of the case review, and cooperate with the Ukraine NCA. An effective CCP may significantly increase the likelihood that the preconditions for the successful use of the above procedures are in place.
It is also worth mentioning that, due to the significant reshaping of the procedure for the Ukraine NCA’s dawn raids introduced in the first stage of competition law reform and the broadening the authority’s powers in this regard, it makes sense to consider adopting or updating dawn raid policies, which usually serve as integral part of CCPs, in light of the new legislative framework.
8. Are there legal developments on the horizon in relation to CCPs?
Ukraine is currently on the second stage of competition law reform. Recently, the Ukraine NCA released a new draft law for public discussion. Although it does not directly refer to CCP-related specifics, if adopted it will trigger a necessity for businesses to reconsider CCPs. This is because the draft law proposes groundbreaking changes to provisions including: (i) abolishing the concerted practices approval regime and replacing it with a self-assessment system similar to those used in the EU; (ii) introducing the concept of abuse of a more advantageous negotiating position and introducing liability for such abuse; and (iii) incorporating provisions regarding the invalidity of transactions made in breach of the rules on anticompetitive concerted practices and abuse of dominance, as well as those transactions that violate the Ukrainian merger control regime. To this end, after the second stage of the competition law reform is implemented, it will make sense to revise existing CCPs or, if a company does not have CCPs, to consider adopting them.
