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Before the Raid

Head office of an ordinary company, somewhere not very far away. The office of the in-house lawyer.

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I like working in-house. I never know what’s going to happen next...

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Click on the correct answer

I'm a bit worried about our discussions with competitors – what if there's a dawn raid?

It's dangerous to delete emails – investigators can often recover them, and someone always keeps a copy. It's far better to avoid trouble by ensuring compliance.

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The Dawn Raid Starts

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Hello, we're from the Commission, we want to do an inspection and we want to see the CEO

There is no right to refuse entry until a particular person is present, but conversely it's important to ensure that the proper process is followed. The first step is to check who is seeking access and their written authority to enter.

Hello, we're from the Commission, we want to do an inspection and we want to see the CEO

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I've checked their documents – they look OK – what should I do next?

It's vital to talk to a real person – don't rely on voicemail or emails. Keep trying until you find someone responsible.

I've checked their documents – they look OK – what should I do next?

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Click or tap all answers that apply

The dawn raid coordinator arrives in reception. Official waves a piece of paper - here's our authorisation – we are carrying out an inspection!

This is going to be a long day, with some important practical steps to take now.

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Hmm, this is an authorisation not a decision from the Commission and they've got the address for next door, not here. What shall I do?

This is a difficult one. If you refuse to let them in, they will come back shortly with a corrected document. It may be better not to take this point if it's obviously a simple clerical error.

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We need to start immediately!

Inspectors will usually wait for a short period, although they may wish to secure particular offices while they do so. It can be useful to arrange a call with the external legal team to discuss practical issues like this.

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We'd like to go straight to the CEO's office and start searching before anything gets shredded

Investigators will only wait a short period, but there is often scope for flexibility in how the investigation is carried out while waiting for the external lawyers' arrival.

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One Hour Later

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OK, we've waited for an hour, but now we need to start

Don't forget that external lawyers can provide useful input while en route. It may be possible to set up a call with the inspectors.

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Hmm, the lawyers are about to arrive, but I will accompany the investigators to...

Investigators have wide powers to talk to individuals on-site, to ask for explanations of documents etc that they find. They can also take confidential material. A key role of the dawn raid team is to shadow the investigators and to make sure that they keep to the terms of their authorisation.

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Please show me the customer files for 2013

The business is required to cooperate with the investigators.

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I want to see these files marked "legal"

The European Court of Justice confirmed in 2012 in its Akzo Nobel Chemicals judgment that advice from in-house counsel is not covered by legal privilege when the Commission is investigating. In other jurisdictions, such as Australia, and some EU Member States in the case of inspections by national authorities under national competition law, legal privilege can also apply to in house lawyers' communications, while in China there is no legal privilege at all. Always check the application of legal privilege in your jurisdiction.

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I'll need to read this email to check that it really does contain privileged legal advice

There is usually a mechanism for any disputes to be resolved by a third party or the courts – it's often necessary to show the investigators a heading or something similar, so that they can check, but they shouldn't look at the whole document in order to assess privilege. It may be possible to have disputed material secured (in a sealed envelope etc) until its status as privileged advice can be verified.

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I'll need to take these files away with me

Many authorities have powers to take originals under certain circumstances – check what powers the investigators have.

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It makes sense to look after the investigators – you've got to work with them!

Are you OK for tea and coffee, shall I arrange some?

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I want to look at the diary for the Vice-President of sales for EMEA

Investigators have the power to look at personal documents too – although they are usually receptive to sensitivities about personal information.

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Does "Meeting GHZ" mean a meeting in the Grand Hotel Zurich?

Investigators are entitled to ask for explanations of a document – and the business must cooperate.

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It says here that there was a meeting in Zurich on 20 September last year. Was that to fix prices?

The privilege against self-incrimination is recognised in most jurisdictions such as the EU (Case 374/87 Orkem) and Australia.

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I'm certainly taking this document – it's an admission that the company took part in a cartel, and it names all the individuals involved

The European Court of Justice made it clear in its Orkem judgment that the privilege against self-incrimination doesn't cover documents that were already in existence, even if they incriminate the business. The same principle applies in other jurisdictions where the privilege against self-incrimination exists.

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Ideally you want to try to get a step ahead of the investigators and see if you can work out what has been happening. So some of the team could usefully carry out a separate internal assessment.

I'd better find out what's been going on – I'll get someone else to start interviewing those involved, and reviewing the files. Management need to know what our exposure is and whether we can limit it.

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I've got a few questions about IT issues

It's important to involve IT specialists as early as possible, to answer questions and to advise on issues such as accessing emails, blocking email accounts etc.

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Please set a new password for Daniel García's email account and make sure no-one else can access it.

The Commission fined two Czech energy companies €2 million in 2012 for re-enabling access to email accounts that had been blocked during an inspection. In other jurisdictions re-enabling access to emails during an investigation may amount to illegal hindering or obstruction of the investigation.

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It's important for the company to form its own view of what has been happening.

I'd better also get someone in the external legal team to interview Daniel straight away and find out what he's been doing

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There's too much on this PC for us to look at here – we'll just copy the whole hard drive and take it away for review

Many authorities have the power to "seize and sift" – to take material away for review back at their offices if they can't do it all on-site. They should provide safeguards, eg. securing drives etc containing seized data until they are opened and reviewed in the presence of the advisers of the business”.

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While we're here we might as well see what else you have been up to...

The investigators must stick to the terms of their authorisation. They can't take the opportunity to look for evidence of other infringements; a so-called "fishing expedition".

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I'm taking this phone. Even if it's personal, I think that a phone may have been used to arrange cartel meetings and I'm authorised to take it away and look for them

We always check carefully whether the investigators can look at personal phones – most can if they think that a phone has been used to arrange a cartel, but they may need additional court authorisation. If they give us back the SIM then we can put it in another phone and continue to use the number.

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We're not finished yet – we want to seal this office overnight!

Yes, competition authorities have the power to seal premises. Make sure you instruct all personnel that the seals cannot be broken. You may be able to agree with the inspectors that all documents will be placed in one sealed room.

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The Commission fined E.On €38m for breaking a seal in 2008. The European Court upheld the fine, even though there was no evidence that any evidence had been affected. In other jurisdictions failure to take steps to prevent persons accessing materials during an investigation may amount to illegal hindering or obstruction of the investigation.

I'd better make sure no-one goes in overnight – I'll put notices up and also make sure the cleaners know. Hmm, perhaps I'd better have one of the security team sit outside the door overnight. We don't want to get fined for breaking the seal.

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At The End

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Here's a list of everything we've taken – please sign here to say that it's correct

It's important to ensure that you have a full record of the day's activities.

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Phew, I'm glad that's over. Now what?

There's usually a lot to do after the investigators leave – assessing the risk to the business and next steps.

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That's it!

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Your Score

Better luck next time! Try the game again to improve your score and avoid a fine.

Correct Answers: 0

Incorrect Answers: 0

If you'd like, you can always take the quiz again here.

Remember; any company, no matter how small, could be subject to a dawn raid, so make sure you're prepared.

Thanks for playing the Dawn Raid Game! If you'd like to know more about how we can help, please be in touch with either our Competition & EU Law group co-heads Jose Rivas and Peter Willis or your usual Bird & Bird contact. Take a look at https://www.twobirds.com/en/practice-areas/competition-and-eu-law for more news and information.

Best Wishes,

The Team at Bird & Bird

One firm. Your firm.

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