The failure of the leniency program in Hungary

Leniency policy is designed to enhance the effectiveness of competition law enforcement. The common EU approach to leniency is laid down in the European Competition Network (ECN) model program, a soft law measure meant to bring about convergence across Member States. Hungary has implemented such a national leniency policy. This transplant, however, may be considered a failure : whistleblowing is almost non-existent. The reasons relate first to Hungarian business culture. It is a small market where business owners and managers know that they will have to continue to operate on the same market with those they blew the whistle on. Furthermore, snitching was shunned under the socialist history of the country. Finally, the absence of link between competition law and criminal sanctions means that wistleblowing can only yield a reduction of fines under criminal law. Managers are thus deterred from bringing leniency application, since this would mean they incriminate themselves.