Colombia: Competition Authority Publishes Guide on Competition Compliance Program

Industry and Commerce Supervision Bureau Issues Guidelines on Implementing Competition Compliance Programs

in a nutshell

Compliance with competition laws

The Industry and Commerce Supervisory Authority (SIC), the only agency for competition protection in Colombia, has published a guide to provide orientation in the implementation of competition compliance programs (seeguide”).

Although the Guide has a doctrinal scope and does not impose any obligations, its publication will enable the market to understand the relevance of these types of programs, the benefits of implementing them, and the key elements they should include in the SIC. can understand the vision that Develop. As such, SIC emphasizes the value of these programs as mechanisms for the prevention and early detection of anticompetitive behavior.

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1. Competitive Compliance Program Benefits
2. General Recommendations for Implementing a Competitive Compliance Program
3. Key Considerations for Risk Management in Competition Matters

In its guide, the SIC shows that an effective compliance program does more than just enable companies to identify risks and prevent violations of competition laws. Through the Guide, the agency also provides organizations with proactive measures in the event of early detection of conduct that may violate these laws.

SIC identifies the following benefits of a compliance program:

• Prevent fines, sanctions, disqualification of officers/directors, criminal investigations and/or civil lawsuits for damages
• Strengthen the market and increase economic efficiency
• Improve talent management and contribute to the survival of the company
• Reputational benefits that go hand in hand with promoting a culture of compliance

SIC has defined certain elements as the pillars of an effective competitive compliance program (program).

The SIC Guide recommends certain elements that the SIC believes are essential for the effectiveness of this type of program. Among these elements, the following are highlighted:

• Commitment of company managers as a key element in the culture of complianceSIC emphasizes that the tone of compliance must come from the company’s management (top tone). Management must demonstrate a commitment to protecting competition in a way that conveys the importance of a culture of compliance throughout the organization.
• Appropriate risk managementAppropriate measures are proposed for risk identification, analysis, measurement and control.
• Allocation of sufficient and appropriate resources for the programAccording to SIC, resource allocation is critical to program implementation, evaluation, and continuous improvement. Depending on the characteristics of each company, resources are considered sufficient.
• Appointment of Compliance OfficerThe SIC suggests that the selection of the most effective model to achieve the objectives outlined in the program should be made on a case-by-case basis. A compliance officer may therefore be an internal corporate collaborator, an academic compliance agency, or an external consultant. Whatever profile you choose, your priority should be the decision-making ability and autonomy of your program personnel.
• Grievance channel known to all collaborators and interest groupsSIC argues that it is essential to implement a complaints channel that guarantees the confidentiality and anonymity of complainants. These measures must facilitate effective participation of program recipients. Channels the company can enable include email, phone hotlines, and technical tools.
• Training program on compliance with regulations and best practices in competition mattersThis guide recommends implementing a training process to send a clear and consistent message about the purpose and benefits of the program and the compliance responsibilities of each individual within your company.
• Implementing Incentives and Disciplinary ActionsAccording to SIC, incentive systems can have a positive impact on program adherence, employee trust in reporting channels, and program institutional mechanisms. The guide also recommends establishing internal protocols to enable inquiries and investigations to be conducted, and to punish agents who violate competition laws. This guide emphasizes the importance of due process and the right to defense in accordance with current labor law.
• Due diligence on suppliers and third party partnersThis guide proposes including verification mechanisms regarding the integrity of suppliers or third-party partners, particularly their compliance with competition laws in business.

crisis management: To achieve this objective, each entity must carry out specific analyzes of its activities and market conditions to identify risks and take adequate and proportionate measures to mitigate them. . The elements proposed by SIC should be oriented towards:

• Identify, recognize and describe situations that may give rise to violations of national competition laws in order to understand the nature and characteristics of the challenges facing the company.
• It establishes the level of probability or occurrence of each identified risk, detailing the risk-generating factors that produce the associated risk and their respective rates of occurrence.
  1. risk assessment: This consists of establishing the impact of each risk within the organization. This allows companies to determine their risk management and mitigation needs, priorities, and alternatives.
  2. Risk response: According to SIC, this last aspect of the program consists of the implementation of mechanisms that allow analysis of the effects of each mitigation action and the benefits expected from its implementation. Based on the information collected, remedial actions are suggested to be taken before terminating the process.

you can find a guide here.