After the promulgation of the legal amendment to the Costa Rica Competition Act on 2013, which introduced new antitrust violations and the mandatory merger notification regime before the Competition Commission, a renovated interested in antitrust compliance programs has surged due to the potential obligation of companies to be subject to the scrutiny of the Competition Authority upon entering into a merger or acquisition.
Although many large multinational companies have already antitrust compliance programs in place, there is still many work left to do in terms of “nationalizing” the different concepts and adapting them to the specific circumstances of the Costa Rican regulations, legal culture and market. Furthermore, compliance programs have remained a novelty among the majority of local Costa Rican companies, however many of them are beginning to ask more frequently about ways to protect themselves from potential investigations and antitrust violations – which carry hefty fines and damages to the reputation of the company - and are also seeking to increase knowledge and awareness of potential anticompetitive behaviors in a preventive way.
Antitrust law compliance policies serve as an efficient mechanism that fulfils at least two important objectives. First, they provide guidelines for the application of the different concepts of the Antitrust Law while reflecting the specific needs and risks of associated to a particular industry or business sector. Second, they offer evidence to the public authorities and officials with respect to the antitrust compliance culture of the company, which could under certain circumstances be considered as mitigating factors during the analysis of antitrust investigations, while determining the severity of the fines or circumscribing the liability of the officers involved on an antitrust violation.
The design and successful implementation of an antitrust compliance program requires knowing which risks are associated to a particular sector or industry and how to prevent those risks. The compliance program should also be written in a language that is easily understood by all employees at the different company levels and must provide practical examples that facilitate the understanding of the key concepts set forth in the law. Day to day topics such as proper drafting of email communications, handling of business conversations with competitors, participation in trade or industry associations, documentation of the board of directors´ minutes, are just some of the issues that could potentially be used against a company on the basis of a simple appearance of illegality.
The key components of program should incorporate training in order to clearly communicate the standards and procedures to all employees in antitrust matters. In addition to compliance training, a company should ensure that high-risk activities are routinely monitored and evaluated. Also, the compliance program should include auditing and testing activities in order to evaluate the progress that a company has achieved in this field and adopt actions in the areas that present a level of weakness. This means that the company should analyze the operation of its compliance program itself and should undertake to correct flaws when they are found.
Rigorous competition law compliance policies should form part of every business. The role of expert external legal advisors is critical in the implementation of a successful antitrust compliance program. In this regard, the antitrust experience that the advisors can provide, the objectivity in analyzing the companies´ risks as well as the confidentiality protections granted by the attorney-client privilege ensure that the compliance program fulfills its objective of preventing or detecting in advance anticompetitive behavior.
Finally we must note that compliance programs are not limited to antitrust areas, but to any regulatory law area that is relevant to the company activity, such as anti-corruption, consumer protection, labor, licenses, environmental among others.