The Leniency Program in Korea and Its Effectiveness

Koh, Sae Ran; Jeong, Jinook

doi:10.1093/joclec/nht023

Cited by 4 publications

(9 citation statements)

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“…Our study is closely related to the studies of Brenner (2011), Marvão (2014), Koh and Jeong (2014), Hoang et al (2014), Kim and Kim (2016), and Rosenboom 1 It is worth highlighting that when a company applies to the leniency program, it is acknowledging its liability as a participant in the cartel and, at the same time, providing solid evidence of the involvement of other companies. This decreases the likelihood of successful appeals against the competition authorities' penalty decision (Motta, 2009).…”

Section: Introductionsupporting

confidence: 55%

“…can be a significant driver for a cartel to be uncovered through a leniency application. Koh and Jeong (2014) consider bidrigging as a determinant of leniency applications-although its impact is not statistically significant. Kim and Kim (2016) divide their sample into two groups: the nonbidding cartel sample, and the bidding cartel sample.…”

Section: Cartel Structure and Cartel Activitymentioning

confidence: 99%

“…They also find that in those cases where the 2002 Leniency Notice was applied, recidivist groups are more likely to be the chief witnesses. Koh and Jeong (2014) and Kim and Kim (2016) analyze the factors that induce applications to the leniency program for penalized cartels in South Korea. The former analyze cartel-level characteristics over the period 2005-2012 and find that the number of leniency applications increased during the early years-2008-2009-of the global financial crisis, in cartels with a smaller number of members.…”

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confidence: 99%

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Who Blows the Whistle on Cartels? Finding the Leniency Applicant at the European Commission

2023

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Competition authorities need a better understanding of the determinants of cartel self-reporting in order to increase cartel members’ incentives to apply for the benefit from leniency programs and thus improve the effectiveness of anti-cartel policy. Using information on 683 firm groups that participated in 132 cartels that were penalized by the European Commission between 1996 and 2020, we estimate which type of cartel member is most likely to be the first or subsequent leniency applicant. Our results emphasize the role of firm groups as a driver to self-report: The higher is the proportion of firms that are part of the same group (relative to the size of the cartel), the greater is the likelihood of applying for leniency. Fines also incentivize cartelists—with the exceptions of ringleaders—to self-report. While ringleaders or instigators tend to avoid being first confessors, they appear to be more likely to self-report than are others only after someone else has revealed the cartel. Finally, cartels that do bid-rigging are less likely to be uncovered by a leniency application.

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Section: Introductionsupporting

confidence: 55%

Section: Cartel Structure and Cartel Activitymentioning

confidence: 99%

mentioning

confidence: 99%

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Who Blows the Whistle on Cartels? Finding the Leniency Applicant at the European Commission

2023

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“…South Korea promptly followed, launching the KFTC leniency program in 1997, which has resulted in a substantial increase in the cartels detected thanks to confessions by large conglomerates, especially after the 2005 reforms (Son 2010; Choi & Hahn 2014;Kim & Kim 2016). 37 The program appears to also be successful by destabilizing cartels, evidenced by the shortened duration of known cartels' operations (Choi 2011;Koh & Jeong 2013). Leniency programs are now quite common in many countries, but the KFTC's early adoption and successful implementation of the program suggest that South Korea is swift to adopt competition norms shared by the United States and the EU.…”

Section: Convergence Of South Korean Eu and Us Competition Law Preferencesmentioning

confidence: 99%

From rule‐takerto rule‐promotingregulatory state: South Korea in the nearly‐globalcompetition regime

Cho

Büthe

2021

Regulation & Governance

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When rapid economic growth catapults a country within a few years from the margins of the global economy to middle power status, does global regulatory governance need to brace for a challenge to the status quo? To answer this question, we extend the power transition theory of global economic governance to middle powers: A rising middle power should be expected to challenge the international regulatory status quo only if increasing issue-specific strength of its regulatory state coincides with preferences that diverge from the preferences of the established powers, which are enshrined in the status quo. We examine this argument empirically, focusing on South Korea in the realm of competition law and policy. We find that South Korea, a non-participant in the international competition regime until the 1980s, developed in the 1990s substantial regulatory capacity and capability and thus "spoiler potential." At the same time, however, its policy preferences converged upon the norms and practices established by the United States and the European Union, albeit with some distinct elements. Under these conditions, we expect a transition from rule-taker to rule-promoter. We find that South Korea has indeed in recent years begun to actively promote well-established competition law and policy norms and practicessupplemented by its distinct elementsthrough technical assistance programs, as well as various bilateral channels and multilateral institutions. The findings suggest that the power transition theory of global economic governance is usefully applicable to middle powers, too.

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“…Finally, there is an increasing number of empirical studies that measure the impact of leniency programs but are decidedly mixed and tentative in their findings. Miller (2009) examines the impact of the leniency program in the United States; Choi (2011) and Koh and Jeong (2014) consider the program in Korea; Stephan (2008), Brenner (2009), Klein (2010, and Zhou (2011) investigate the impact of the EC's leniency program; and Dong, Massa, and Žaldokas (2014) engage in a cross-country analysis.…”

Section: Introductionmentioning

confidence: 99%

When Can We Expect a Corporate Leniency Program to Result in Fewer Cartels?

Harrington

Chang

2015

The Journal of Law and Economics

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Leniency programs have become widespread and are generally quite active as reflected in the number of applications. What is not well understood is how they affect the number of cartels. This paper develops and explores a theoretical framework to help understand when leniency programs are likely to be effective in reducing the presence of cartels. Plausible conditions are derived whereby a leniency program can result in more cartels. On a more positive note, we identify situations and policies that a competition authority can pursue that will make it more likely that a leniency program will have the intended effect of reducing the number of cartels.

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The Leniency Program in Korea and Its Effectiveness

Cited by 4 publications

References 0 publications

Who Blows the Whistle on Cartels? Finding the Leniency Applicant at the European Commission

Who Blows the Whistle on Cartels? Finding the Leniency Applicant at the European Commission

From rule‐takerto rule‐promotingregulatory state: South Korea in the nearly‐globalcompetition regime

When Can We Expect a Corporate Leniency Program to Result in Fewer Cartels?

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