The DOJ's new bounty system: Revolution in US antitrust law and implications for (German) companies

The US Department of Justice (DOJ) creates targeted financial incentives for whistleblowers who provide information on antitrust crimes. The Whistleblower Rewards Program (known as the "bounty system"), which was developed in cooperation with the United States Postal Service (USPS) and its Office of Inspector General (OIG), aims to intensify the detection and prosecution of antitrust violations and anti-competitive practices. This poses challenges and risks for companies, legal departments, and compliance officers, requiring them to adapt existing compliance structures.

Background and objectives of the bounty system

With the new bounty system, the DOJ aims to more effectively detect and sanction antitrust violations that are sometimes difficult to uncover, in particular price fixing, bid rigging, and market sharing. Antitrust violations are often committed in secret, which means that traditional investigative approaches reach their limits. The bounty system therefore relies on insider knowledge: individuals who voluntarily and on their own initiative provide relevant information can be rewarded with up to 30% of the fines imposed, provided that their information leads to a conviction and a minimum fine of US$1 million.

The program was developed in close coordination between the DOJ, USPS, USPS OIG, and the United States Postal Inspection Service (USPIS). The cooperation between these authorities is intended to ensure effective coordination in the receipt, evaluation, and prosecution of tips.

How it works and requirements for whistleblowers

The bounty system is subject to specific requirements:

• Reporting of criminal offenses: Rewards are given for information on criminal violations of US antitrust law (in particular Ssections 1-3 of the Sherman Act, i. e., price fixing, bid rigging, market sharing, monopolization) and related criminal offenses affecting competition or public procurement.
• Connection to the USPS: The reported violations must have a connection to the USPS, its revenues, or its assets. However, the authorities have indicated that they will interpret this connection broadly in order to maximize the effectiveness of the program.
• Originality and voluntariness: The information must be provided voluntarily, prior to a request from the authorities, and based on the whistleblower's own findings. It must not already be known to the authorities or derived from public sources.
• Exclusion of certain persons: Persons who have acted as initiators or principal perpetrators themselves, as well as employees of the DOJ, USPS, or other law enforcement agencies and their relatives, are not eligible for rewards.
• Exceptions for compliance and management personnel: In principle, compliance and audit staff as well as managers are also excluded from receiving rewards if they obtain information in the course of their duties. However, there are exceptions, for example if the report is necessary to prevent serious crimes or if the internal report was unsuccessful and is forwarded to the DOJ after 120 days.

Practical implications for companies

The new bounty system represents a paradigm shift in US antitrust enforcement and has far-reaching practical consequences for (German) companies:

• Increased risk of discovery and new reporting channels: Financial incentives increase the likelihood that insiders will report antitrust violations, even if they themselves are not at risk of prosecution. This applies not only to traditional whistleblowers, but also to employees who previously had no incentive to contact the authorities. Companies must expect internal grievances to be reported externally more quickly and more frequently.
• Interaction with the leniency program: For years, the DOJ has maintained a Corporate Leniency Program that grants immunity from prosecution to companies and individuals who are the first to report an antitrust violation and cooperate fully. The new bounty system complements this program by also giving third parties – who are not themselves subject to prosecution – an incentive to report violations. For companies, this means that the period of time during which voluntary disclosure can still lead to immunity from prosecution is becoming shorter. Internal reports must therefore be processed even more quickly and consistently.

• The importance of effective compliance systems: Given the increased risk of detection and the potential financial incentives for whistleblowers, a robust compliance management system (CMS) is more important than ever.

  Companies should:

1. Regularly train employees on antitrust risks and reporting channels,
2. Implement internal whistleblower systems and regularly test their functionality.
3. Establish clear processes for the internal investigation and management of reports.
4. Conduct anti-retaliation training for managers and the board of directors.
5. draft contractual provisions (e. g., confidentiality agreements) in such a way that they do not unduly restrict the possibility of reporting to authorities.

Internal and external coordination

The close coordination between the DOJ, USPS, USPIS, and OIG shows that US authorities will take even more coordinated action against antitrust violations in the future. Companies operating in the US or coming into contact with US authorities must prepare for increased regulatory cooperation and more intensive information exchange. This applies in particular to industries that regularly deal with public contracts or the USPS.

Addition to the DOJ's recently announced whistleblower program

The whistleblower program of the DOJ's Criminal Division, which was introduced in August 2024, had explicitly excluded antitrust violations from its scope. This "gap" is now closed by the program introduced by the Antitrust Division (together with other US authorities), thereby significantly expanding the scope of the whistleblower program initiated by the DOJ.

Deviations from previous practice and international relevance

The bounty system differs from previous US and European approaches in several respects:

• Monetary incentives for third parties: While the leniency program primarily relies on self-reporting and cooperation by offenders, the bounty system is explicitly aimed at third parties who are not themselves liable to prosecution.
• Modeled on the SEC program: The DOJ is following the example of the successful whistleblower program of the US Securities and Exchange Commission (SEC), which has led to numerous disclosures and high payouts in recent years.
• Broad interpretation of USPS relevance: The authorities have announced that they will interpret the relevance to USPS interests broadly, which significantly increases the scope of the program.
• Coordination with other authorities: The close cooperation between the DOJ, USPS, USPIS, and OIG is a novelty and is likely to further increase the effectiveness of antitrust enforcement.

For companies operating internationally, it is also relevant that the bounty system can also be applied to cases committed outside the US, provided there is a connection to the USPS or the US market.

Practical note

The DOJ's new bounty system marks a turning point in US antitrust enforcement. Companies must prepare for a significantly increased risk of antitrust violations being detected and prosecuted. The financial incentives for whistleblowers, close cooperation between authorities, and the expansion of the areas of application require a consistent strengthening and adaptation of compliance structures. For legal departments and compliance officers, this means strengthening internal reporting channels, processing reports quickly and professionally, and sensitizing the workforce to the new risks. This is the only way to effectively manage the risks associated with the bounty system and minimize potential damage to the company.