Inside Leniency Play: Why Dentsu’s move could change CCI probe

A day after Dentsu India publicly acknowledged its role in the recent Competition Commission of India’s (CCI) probe into media agency practices and confirmed it has applied for leniency under the CCI regulations, legal experts have weighed in on what this means—for Dentsu, for other implicated agencies, and for the advertising industry at large.

How Leniency Works—and Why Dentsu’s Timing Matters

Under Section 46 of the Competition Act, 2002, and the CCI’s Lesser Penalty Regulations (2009), a company that is the first to report its involvement can secure up to 100% immunity from penalties. But the benefits are conditional.

“The first applicant must provide full, true, and vital disclosures that enable the CCI to either form a prima facie opinion or initiate a formal investigation,” explained Alay Razvi, Managing Partner, Accord Juris. “If Dentsu’s application meets this threshold, they could avoid substantial monetary penalties—and shield their executives from individual liability.”

While Dentsu has publicly admitted its role, the extent of immunity it may receive will depend on the quality of its cooperation, the value of its evidence, and whether it remains consistent throughout the CCI’s proceedings.

What Must Be Disclosed to Qualify

“The bar for leniency is high,” noted Shivani Gupta, Advocate at Delhi and Gujarat High Court. “Applicants are expected to not only stop participating in the activities but also supply incriminating evidence—ranging from pricing emails, chat records, internal memos to meeting documentation.”

 This cooperation must continue throughout the investigation, and any concealment or destruction of evidence can disqualify the applicant or lead to revocation of immunity. Legal experts add that even the best-intentioned disclosures can be rejected if found materially incomplete or misleading.

Industry-Wide Implications: The Domino Effect

Legal precedents globally suggest that Dentsu’s move could open the floodgates for more disclosures.

“Leniency frameworks are designed to destabilise such activities,” said Karan Singh Chandhiok, Partner, Chandhiok & Mahajan. “In jurisdictions like the U.S. and EU, first-mover disclosures have led to higher detection rates and systemic reform. India is likely to see similar patterns.”

According to a global study by Nathan Miller (2009), detection rates for such practices increased by 62% in the U.S. after the DOJ revamped its leniency program. Other jurisdictions have seen a similar rise in voluntary disclosures once immunity incentives were made clearer.

In Dentsu’s case, the disclosure has already led to what appears to be a broader industry inquiry, with more agencies likely to come under scrutiny. While Dentsu may avoid penalties, subsequent applicants—if any—can still apply for reduced fines, capped at 50% and 30% depending on the value of their disclosures and cooperation.

“The leniency framework is a self-detection tool,” added Rohit Jain, Partner at Singhania & Co. “It is aimed at incentivising the first mover to break ranks and aid the Commission in busting such practices. However, the full benefit is subject to fulfilling continuous cooperation requirements. Dentsu’s case will be a benchmark for the advertising industry.”

Can Leniency Be Revoked?

Experts caution that leniency is not guaranteed even for the first applicant. It may be revoked if the information turns out to be misleading, if cooperation lapses midway, or if the applicant fails to meet the stipulated disclosure standards.

“It’s not enough to come forward—you must stay the course,” said Gupta. “If Dentsu’s disclosures don’t add substantial value or don’t help the CCI proceed with enforcement, they may still be penalised.”

Dentsu’s admission has already triggered calls for greater transparency and possibly a regulatory overhaul in India’s media buying ecosystem. Industry insiders suggest that the case could set a precedent and encourage other firms to reassess internal practices.

 
What This Means for Advertising Ecosystem

While the exact scope and impact of the said practices are still under investigation, the case underscores the need for tighter compliance frameworks across holding companies and agencies. With the CCI now actively engaged, stakeholders across the media value chain are bracing for more disclosures, regulatory action, and potentially—industry reform.

An industry marketer, speaking on condition of anonymity, offered a candid reflection, “I am all for challenging the status quo and pushing for change. But what breaks it for me is when it’s done in the shadows, without taking a visible, unapologetic stand. Whether the issue touches our industry or reflects one’s personal values, staying silent when it matters most, only to later surface and reframe the act as a bold, change-making gesture—it doesn’t sit right with me. And especially when it’s packaged as sunshine and intent.”