How effective are leniency programs in detecting, deterring and dismantling cartels within the EU and Malta?

Abstract

This dissertation examines whether the European Union’s expansion of private antitrust enforcement through Directive 2014/104/EU (the Damages Directive) has affected the effectiveness of leniency programmes in cartel enforcement. It addresses a central tension within EU competition law: the coexistence of private damages actions and reliance on leniency-based public enforcement for cartel detection. While the former seeks to ensure effective compensation for victims, leniency programmes depend on strong incentives for cartel participants to self-report. This study investigates whether these two objectives can coexist without undermining each other. Using a doctrinal and analytical methodology, the study explains why leniency is essential to cartel detection. Drawing on deterrence theory and game theory, it shows that leniency programmes destabilise cartels by creating a “prisoners dilemma” dynamic. Leniency enhances evidence collection, increases cartel fragility, and reduces enforcement costs, making it a cornerstone of EU enforcement. It is demonstrated that prior to 2014, leniency operated within a stable institutional framework, supported by predictable incentives such as first-mover advantages. However, the Damages Directive has altered this equilibrium. By strengthening disclosure rules, establishing joint and several liability, and facilitating follow-on damages actions, the Directive increases the expected civil liability faced by leniency applications. The dissertation concludes that the EU enforcement framework requires recalibration. It proposes a balanced approach that preserves leniency incentives while ensuring effective compensation, including limiting civil liability for immunity recipients and strengthening protections for leniency materials. Ultimately, effective cartel enforcement depends on maintaining coherence between public and private enforcement objectives.