O’Melveny Publishes Guide on New Hong Kong Leniency Regime

July 17, 2020

O’Melveny lawyers Philip Monaghan, Scott Schaeffer, and Charles Paillard recently authored the Hong Kong chapter of Immunity and Sanctions, a Global Competition Review (GCR) “know-how” publication.  Among other things, the chapter covers Hong Kong’s newly issued Leniency Notices for undertakings and individuals, which together mark a significant overhaul of Hong Kong’s leniency regime.

As under the previous policy, immunity from penalties is available to the first applicant reporting cartel conduct in contravention of the First Conduct Rule.  Subsequent applicants can receive reductions in fines in exchange for cooperation with the Hong Kong Competition Commission (HKCC).  New to the HKCC’s revised Leniency Notices is the introduction of two types of leniency applicants:

  • Type 1 applicants, who report cartel conduct before the HKCC opens an investigation, and
  • Type 2 applicants, who provide “substantial assistance” to the HKCC once it has opened an investigation. 

Neither applicant will face proceedings before the Competition Tribunal, but Type 1 applicants are also immune from follow-on damages actions.  Leniency is not available to cartel ringleaders or those who coerce other cartel participants.  The new leniency program for individuals generally adheres to the same principles as the corporate program.

The GCR chapter focuses on the nature of leniency, the procedural steps for applicants, the eligibility criteria, the marker process, the cooperation obligations, the process by which leniency is granted, and the circumstances where leniency can be revoked.

Should you have any questions about this alert, the Hong Kong leniency regime, or the Hong Kong Competition Ordinance, please contact any of the key contacts listed below.

This memorandum is a summary for general information and discussion only and may be considered an advertisement for certain purposes. It is not a full analysis of the matters presented, may not be relied upon as legal advice, and does not purport to represent the views of our clients or the Firm. Philip Monaghan, an O'Melveny partner licensed to practice law in England & Wales, Ireland, and Hong Kong, Scott Schaeffer, an O'Melveny counsel licensed to practice law in California and the District of Columbia, and Charles Paillard, an O'Melveny counsel licensed to practice law in France and a registered foreign lawyer in Hong Kong, contributed to the content of this newsletter. The views expressed in this newsletter are the views of the authors except as otherwise noted.

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