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From Antitrust Law Daily, February 28, 2017

AAI releases cartel enforcement recommendations for President Trump

By Jody Coultas, J.D.

The American Antitrust Institute (AAI) has released the cartel chapter of its Transition Report on Competition Policy to the 45th President of the United States, one part of a series of previews the AAI will make available in advance of the report’s publication.

The cartel chapter, entitled "American Cartel Enforcement in Our Global Era," is the sixth in the series of chapters made available for download. The chapter provides an analysis of cartel enforcement trends dating back to 1990 and makes a variety of policy recommendations that will help foster optimal deterrence, improve scholarly understanding of cartel behavior, and better protect consumers from what remains a growing threat.

The AAI recommends:

  • The U.S. Sentencing Commission should revisit the assumption that cartel overcharges are typically 10 percent of affected sales or, indeed, total market sales. The presumption should be raised to at least 20 percent for North American cartels and 30 percent for international cartels.
  • Congress should raise the Sherman Act maximum corporate fine for criminal price fixing to $1 billion and the Sherman Act maximum fine for individuals to $10 million.
  • Congress, or the Antitrust Division of its own accord, should institute whistleblower rewards in cartel cases akin to those made available in qui tam civil suits under the False Claims Act, and the administration should support legislation protecting cartel whistleblowers from retaliation.
  • After securing criminal convictions, the Antitrust Division should routinely inquire about, and publicly report on, details concerning how cartels were able to collude and sustain their collusion. It should also consider requiring, in sentencing agreements, that defendants turn over simple post-conviction reports for five years on their production costs, sales, and prices in the affected market.
  • The Division should receive a budget increase earmarked for its program to help educate foreign antitrust authorities in how to design effective leniency programs, impose appropriate monetary sanctions, implement criminal provisions in their antitrust laws, and improve their anti-cartel enforcement generally.

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