The Act on the Protection of Competition amendment effective as of December 1, 2012 introduces legal institutes of the so called leniency programme and settlement into the Czech competition law.

Leniency programme

The most significant update is the so called leniency programme. Its principle lies in the Office for Protection of Competition having to withdraw from imposing the fine to a cartel participant or having to reduce the fine already imposed by up to 50 %, provided that such participant at the same time (i) comes forward to the Office with new and relevant information about the cartel, (ii) admits to being involved in the cartel, (iii) does not force other competitors to become involved in the cartel, and (iv) collaborates with the Office in resolving the case.

Although the Office has had the Leniency programme in use for many years, it has been based purely on the agreement between the Office and the cartel participant whereby the participants had no legal guarantee whether the Office would enter the agreement or actually fulfil such agreement. New legal legislation lays down for the Office the duty to withdraw from imposing the fine or reduce it, provided the aforementioned terms are complied with. Therefore, the amendment should be a greater motivation for the cartel members to collaborate with the Office.

Settlement

Apart from the leniency programme, the amendment lays down a concept parallel to the so called settlement used by the European Commission. The Settlement means that the Office shall reduce the fine by 20 % in case where the competitor admits to committing the infraction and the Office deems that such penalty is sufficient. The legislation aims at motivating the competitors to collaborate with the Office and hence reduce the Office administrative costs.

Unlike the leniency programme, the settlement option is open not only to the cartel member, but also to the competitors who abuse their dominant position or who joined together without having been issued the respective permission.