Peter Scott: Richard, we’re going to be talking about the role that leniency programmes play in Europe in particular, but around the world. Andin particular, the fact there’s been a material reduction, I think, in the level of leniency applications coming forward over the last few years. That’s been attributed in large parts to the Damages Directive and the rise of private enforcement. Do you think the Damages Directive risks killing the Commission’s goose that lays the golden egg?
Richard Whish: Well, I don’t think the Damages Directive itself would have that affect in the sense that I think that the whole damages issue had become a very significant one before the Damages Directive. This is one of those areas where the market had already evolved, it seems to me claimant lawyers, enormous potential claims, funding, methods in the market that didn’t used to exist, these damages claims pre-date quite considerably the Damages Directive itself. So I wouldn’t lay the blame at the feet of that particular piece legislation. I think it’s clear why there are fewer applications which is that the whole area has become so immensely complicated and so very risky. Yes, there’s the damages claims but there far more jurisdictions out there in which there’s a potential penalty that might be imposed and/or authorities such as China, South Africa, India, Brazil; they are all up and running and they are imposing substantial penalties; there’s criminal sanctions. There’s a whole host of considerations and I can see why it would be that a potential whistle-blower would stop and think very carefully before taking the plunge.
Peter Scott: And in terms of the Commission’s efforts to try to redress the balance back in terms of making the carrot bigger. Not only do you avoid potentially a huge fine, but in terms of dealing with the risk of private enforcement, the proposal in the Damages Directive is to avoid a whistle-blower being liable on a joint and several liability basis. Do you think that will make any material difference for companies?
Richard Whish: Well it’s an interesting one and obviously people have to decide that on a case-by-case basis. To a certain extent, it’s an attempt to replicate something like what they have in the United States where the whistle-blower doesn’t bear responsibility for treble damages but only for single damages. Of course we don’t have treble damages so you can’t have that in our Directive. Will this make a difference? I suppose in some cases it might, but I suppose there are risks the other way as well. We’ll have to wait and see.
Peter Scott: Turning to new tools that the Commission and National Competition Authorities might look to do to uncover more cartels and encourage leniency. Very recently, the Commission announced a new hotline to incentivise individuals to come forward, safe in the knowledge that any complaint will be received on an anonymous basis. Do you think that initiative will make any real difference?
Richard Whish: It’s an interesting one, isn’t it, we have to distinguish the whistle-blower in the sense of the undertaking that is going to get immunity from being fined from the informant who decides that they want to tell an authority that something bad is going on either because they’ve got a moral scruple or - I’m actually told often - jilted lover who wants to get revenge on somebody for some past unhappiness. I suppose there will be cases, the CMA and before it at the OFT has had a system like this that exists in South Korea, I think Germany have done it. I’m sure it will make a contribution, but I suspect somehow it might be fairly marginal.
Peter Scott: From a company’s perspective it strikes me that a downside of these incentivising individuals to go directly to the regulator, is that it potentially cuts across internal compliance efforts to persuade disgruntled employees to use the internal hotline to complain to the right team within the organisation to then make a proper application for leniency with the benefit of avoiding fines and any individual sanction. Do you think there is a risk of these efforts that are cutting across those compliance efforts?
Richard Whish: Well, yes, I think this is part of the complexity, it does strike me how very different one cartel can be from another cartel so there might be some cases where this is more of a problem than in others. But it is obviously amongst those whole range of very difficult considerations that have to be taken into account.
Peter Scott: Great, thanks very much Richard.
Richard Whish: Thank you Peter.