YourABA July 2011 Masthead

Designing a compliance program for antitrust enforcement regimes begins with identifying commonalities

“Think globally, act locally,” were words of guidance from Washington, D.C., lawyer Mark Whitener, General Electric Co., in talking about designing a compliance program for antitrust enforcement regimes.

Competition law is particularly challenging in the international legal context, said Whitener. There is the inherent flexibility of the laws themselves as well as great variability in the enforcement approaches taken in different countries. Developing a compliance program can be especially challenging where competition law and the culture of competition is still emerging, such as in Russia, India and China. These three nations were the focus of a recent ABA-sponsored CLE program, "Russia, China and India: Designing Compliance Programs for Developing Antitrust Enforcement Regimes.”

Neglecting to build positive relationships in the country where business is being conducted can be an invitation to becoming a target to a new, emerging competition law regime that is looking for cases to “prove itself.”

Generally, companies should have a competition law compliance policy that is global in nature. That policy can take a consistent approach to many of the key issues related to three major areas of competition: merger control, cartel behavior and abuse of dominance. “As we’ve seen competition law develop in recent years, as many countries join the fray, there are common elements in approaching the three issues,” explained Whitener, pointing out that the simplicity of a global approach can help in educating a company’s business leaders as well as rank and file personnel about behavior that is prohibited and what conduct requires consultation.

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In regard to merger control, Whitener said that a global approach could emphasize the importance of adhering with filing requirements while also acknowledging some of the differences between countries, such as the varying thresholds that may not always be transparent, especially those in some of the jurisdictions looked at during this program.

There can also be a core approach to employee guidance relative to cartel behavior, where certain types of behavior such as bid rigging and price fixing is going to be categorically prohibited in most countries. In this particular area, there is enough commonality from country to country that a global approach to competition policy makes sense, explained Whitener.

There may be more variability and ambiguity from country to country with respect to abuse of dominance issues than in the other areas mentioned, and not only in Russia, India and China, continued Whitener. Still, a global approach could focus on industries where market dominance is at least arguable, and then focus on the kinds of conduct that could potentially be viewed as abusive.

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Also applicable to any foreign country, Whitener suggested that an in-house counsel build positive relationships in the country in which business is being conducted. Those relationships should include individuals with the government, customers and trading partners. Neglecting those relationships can be an invitation to becoming a target to a new, emerging competition law regime that is looking for cases to “prove itself.”

Even with a global approach to developing a policy, counsel still must identify the exceptions that from country to country require acting in a different manner. Whitener’s advice to “act locally,” refers to the importance of addressing the outliers and the exceptions where a general, common approach may not work.

The program was sponsored by the Section of Antitrust Law Corporate Counseling Committee, the Young Lawyers Division and the Center for CLE. Daniel Sokol, University of Florida Levin College of Law, moderated the program. Beijing-based Susan Ning of King & Wolf, Pallavi Shroff of Amarchand & Mangaldas & Suresh A Shroff & Co. in India, and Maria Ankoudinova of Jones Day in India also participated in the program as panelists.

Course materials that provide specific guidance on antitrust enforcement and guidance in Russia, China and India are available here.

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