Who Blows the Whistle on Cartels? Finding the Leniency Applicant at the European Commission

Competition authorities need a better understanding of the determinants of cartel self-reporting in order to increase cartel members’ incentives to apply for the benefit from leniency programs and thus improve the effectiveness of anti-cartel policy. Using information on 683 firm groups that participated in 132 cartels sanctioned by the European Commission between 1996 and 2020, we estimate which type of cartel member is most likely to be the first or subsequent leniency applicant. Our results emphasise the role of firm groups as a driver to self-report: the higher the proportion of firms that are part of the same group (relative to the size of the cartel), the greater the likelihood of applying for leniency. Fines also incentivise cartelists (with the exceptions of ringleaders) to self-report. While ringleaders or instigators tend to avoid being first confessors, they appear to be more likely to self-report than others only once someone else has uncovered the cartel. Finally, cartels that do bid-rigging are less likely to be uncovered by a leniency application