Plenary I: Overview of Anti-Cartel Enforcement Manual Chapters Compilation of best practices
Investigative Strategy
Main issues raised in the UNCTAD Cartel Detection and
Investigation Manual made for the “Komisi Pengawas
Persaingan Usaha” (KPPU) of Indonesia
Pierre M. Horna
Officer in charge of the COMPAL Programme
Competition and Consumer Policies Branch
ICN Cartel Workshop, Panama City, 2 October 2012
Content of the presentation:
1. Investigative Strategy
2. Challenges
1. Investigative Strategy
• Whether a cartel becomes known to the KPPU depends on a variety of
variables. Many of those variables depend on the actions of third parties
and are not in the control of the KPPU.
• Once a complaint is received or an inquiry is launched by the KPPU,
information takes on a new character as potential evidence. Whether
information is developed into usable evidence or leads to evidence
depends on quality of the agency's investigation and the skill of its
investigators. Turning information into evidence requires planning and
strategy.
• The importance of having a well thought out strategy and plan of
investigation cannot be overstated. They are critical to successful
investigations. They are the key to whether initial allegations of
wrongdoing are progressed to charges of a violation. They can make
the difference between the success and failure.
1. Investigative Strategy
• The earliest stages of an inquiry are often the most important. Even if
the preliminary stages of an inquiry are limited by severe time
constraints, a rote, “cookiecutter”, one-size-fits-all type approach
should not be taken. Every industry is different. Every violation of the
law is in some aspects unique.
• At the earliest stages, strategic choices involving timing, secrecy and
surprise may determine the outcome of an investigation: whether
documents are found or “go missing”, whether witnesses are
forthcoming with information or refuse to provide cooperation.
• Failing to have a strategy or a bad strategy may result in problems or
oversights that are not capable of being overcome at later stages in the
investigation, regardless of the skill of investigators in following leads
or interviewing witnesses.
1. Investigative Strategy
• The investigation plan uses the case hypothesis to create a plan of
action. Even at the earliest stages of an inquiry a written plan of
investigation is necessary. The plan should be an organic document that
is modified and grows with each new step in the investigation.
• A properly constructed plan of investigation will allow the investigation
team to challenge their assumptions about witnesses and evidence,
review hypotheses about the violations and proofs, and make
determinations about whether and how investigative leads should be
pursued.
• Along with regular team meetings about investigation activities and
results, the investigation plan will provide the road map for the
investigation and guide each step in the investigation.
1. Investigative Strategy
• The investigation plan should
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outline the actions the staff is going to take to prove the hypothesis of the case and it what order;
identify the evidence required to establish an infringement;
indicate where the evidence is expected to be found;
contain a strategy about how the evidence will be obtained;
identify potential witnesses and sources of background information.
incorporate a timeline and plan that is designed maintain the secrecy of the investigation ; and
obtain the best advantage for the agency in terms of surprise.
• Other elements should be taken into account when designing the strategy of the
investigation:
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Investigation Matrix
The Value of Secrecy About the Allegations and Investigation
The Value of Surprise
Drop-in Visits and Interviews
Simultaneous Investigative Activities
Strategic Use of Summonses
Going Public With the Investigation
Using Strategy to Plan an Investigation
1. Investigative Strategy
Strategic Planning and Phases of the Investigation
A. Complaint Intake and Verification
1. Statements and Documents from the Reporting Party
a. Interviews of the Reporting Party
b. Document Handling and Authenticity
c. Sources of Corroboration of Allegations
d. Obtaining a Signed Statement
2. Verification of Allegations
B. Investigation Phase
o Regulatory Requirements for the Investigation
o Summonses, Enforcement and National Police Assistance
o Criminal Charges and Procedural Considerations
2. Challenges
UNCTAD to focus on:
1. Lack of useful tools for cartel investigations:
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No leniency or immunity;
No administrative search powers;
Difficulty in obtaining evidence with summons.
2. Evidence rules in Indonesia
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Proof requires two types of evidence from five approved
types of evidence
Indirect evidence not permitted
2. Challenges (cont’)
• Internal Challenges
• Tight time frames for various stages of the initial
assessment of evidence and full investigation.
• Different groups within the KPPU handle initial
assessment and full investigation.
• Sharing full knowledge and context gained from
one stage of the investigation to the next.
• Limited time for judges to handle objections
with limited knowledge of competition law.
Plenary I: Overview of Anti-Cartel Enforcement Manual Chapters Compilation of best practices
Thank you for your attention
Pierre.Horna@unctad.org
ICN Cartel Workshop, Panama City, 2 October 2012