Rebating Antitrust Fines to Encourage Private Damages Actions

Winand Emons and Severin Lenhard

No 14369, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: To encourage private actions for damages in antitrust cases some jurisdictions subtract a fraction of the redress from the fine. We analyze the effectiveness of this policy. Such a rebate does not encourage settlement negotiations that would otherwise not occur. If, however, the parties settle without the rebate, the introduction of the reduction increases the settlement amount, yet at the price of reduced deterrence for those wrongdoers who are actually fined. Under a leniency program the rebate has no effect on the leniency applicant: she doesn't pay a fine that can be reduced. The overall effect of a fine reduction on deterrence is, therefore, negative.

Keywords: Antitrust; Damages; Deterrence; Leniency (search for similar items in EconPapers)
JEL-codes: D43 K21 K42 L40 (search for similar items in EconPapers)
Date: 2020-01
New Economics Papers: this item is included in nep-ind, nep-law and nep-reg
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Citations: View citations in EconPapers (1)

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Working Paper: Rebating Antitrust Fines to Encourage Private Damages Actions (2020)
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