Dawn raids - unwelcome visitors at the door

Our relaunched microsite on antitrust and white collar crime dawn raids sets out practical tips and updated information on the powers of officials to enter premises, access evidence and interview staff.

  • Submitted 9 January 2015
  • Applicable Law Belgium , European Union , France , Germany , Italy , Japan , Netherlands , Portugal , Spain , UK
  • Topic Antitrust & Merger Control > Dawn raids

Having officials from a competition authority or regulator arrive unannounced to demand documents or search files is an unwelcome interruption in the working day which heralds months of investigation.  Falling into one of the many traps that await the unwary in the course of a raid, however, is an indefensible error on the part of the responsible managers which can cost both the company and individuals dearly.  In recent years, companies have:

  • faced a 10% increase in fine where reception staff prevented European Commission officials from entering the premises pending the arrival of external competition Counsel 1
  • been fined €2.5m where IT staff provided an alternative password to the holder of an account frozen by the officials and diverted emails to an alternative server during the raid 2
  • been fined €38m 3 and €8m 4 in separate cases where a seal placed by officials was breached
  • faced a 30% uplift (amounting to €9.9m) for obstruction where, in contravention of company policy, one employee refused to answer on the spot questions and another shredded documents during the inspection.5

Whilst managers may not be able to identify rogue elements within the company that engage in hidden cartel activity, they can do their best to educate and prepare the workforce to deal with the harder edge of enforcement, should officials come to the premises to investigate the records of the business. They are then less likely to make things worse for the company and for themselves.

Dawn raids are often the first (public) sign that officials are investigating a set of companies or individuals for potential wrong-doing, but they are rarely the very first step in an investigation.  Officials may have been tipped off as to potential wrong-doing by a disgruntled ex-employee as a means of getting back at the company, or by a company also involved in the activity as a means of securing immunity from fines.  There will still be scope for leniency applications, even at this stage, and amidst all the disruption of a raid, discussions should be going on within the company as to the scope and viability of a potential leniency application.

Our relaunched dawn raid microsite has been prepared by specialists from a range of European jurisdictions and Japan.  The sections that have been updated and expanded include those on what to expect when a raid is launched and what the inspectors are permitted to do in relation to digital and hard copy material, and in interviews and less formal questioning.

Backing up the information on the powers of an inspection team, our Practical Tips for individual jurisdictions provide core practical suggestions for avoiding the many pitfalls that face staff during a dawn raid and set out the key decisions that need to be made at speed and under pressure.  While the tips are no substitute for a tailored dawn raid response programme and regular focused training, with both of which we can help you, they do scope out key behaviours that should be second nature to staff and management in a situation that is anything but routine.

1  T-357/06 Koninklijke Wegenbouw Stevin BV v European Commission.

2  T-272/12 Energetický a průmyslový and EP Investment Advisors v Commission

3  C-89/11 P E.ON Energie v Commission

4  Case COMP/39.796 – Suez Environnement breach of seal decision

5  Case COMP 38432 – Professional Videotape, where Sony was given the uplift

This document (and any information accessed through links in this document) is provided for information purposes only and does not constitute legal advice. Professional legal advice should be obtained before taking or refraining from any action as a result of the contents of this document.