Dawn raids – What to do when the competition authorities come knocking

October 16, 2019

Dawn raids – What to do when the competition authorities come knocking

October 16, 2019

Miloš Velimirović

Miloš Velimirović

Partner

Dragan Martin

Dragan Martin

Associate

In the Republic of Serbia, the Protection of Competition Act (Competition Act) recognized the Commission for Protection of Competition (the Commission) as the competent authority in overseeing and enforcing its provisions. In order to exercise its powers, the Commission has been given the status of an autonomous and independent organization that, among other things, has the right to investigate potential competition infringements.

  1. Dawn raids – what are they

As the detection of competition infringements became more difficult with the rise of new technology, the Commission grew fond of a particular in-field investigation method called dawn raid.

Although investigators may barge in at any time, these kinds of raids are usually conducted early in the morning, as employees have the least amount of time to prepare themselves or get rid of damning evidence, thus the name dawn raids.

The investigation is conducted in a few following steps:

  • Entering into business facilities – investigators enter and inspect all business premises including vehicles, land and any other objects in which the company subjected to the raid is conducting its business;
  • Sealing the business premises – no one can come in or out of business premises during the raid;
  • Identification and proper notice – investigators approach authorized representative(s) of a company and present them with proper identification and acquainting them with the subject matter of the investigation;
  • Inspection of documents and other relevant material – investigators go through all documents and files that are relevant to the scope of the investigation, including the files stored electronically. These files may subsequently be searched not only through built-in search engines but also with the use of forensic IT equipment;
  • Confiscation, copying, and scanning of the documents – investigators may confiscate and withhold the documents for as long as it’s needed to copy them if copying was not possible due to technical reasons;
  • Taking the oral statements from the authorized representative of the company or employees.

After all of the abovementioned steps have been completed, the raid comes to an end and the premises are unsealed.

As more and more of these raids are conducted, it is to, that this practice will be continued in the future so the best solution is to stay prepared.

  1. What to do when inspectors come

The most important thing employees and management should keep in mind is to stay calm. Panic will only cause unnecessary stress that may be interpreted by the Commission as a sign that some wrongdoing has occurred. It is highly advisable to create clear internal rules and guidelines for all personnel to follow in a case dawn raid happens. In that way, every person subjected to the investigation will know upfront how to conduct themselves in front of investigators.

Call for your attorney immediately. Party subjected to the proceeding has a right to an attorney present during a raid. Although the call to an attorney will not delay the inspection, the attorney’s presence will ensure that the whole procedure is carried out in accordance with the law.

Remain as cooperative as possible. Compliance with the requests of investigators will prove extremely helpful as any obstruction of the proceeding will result in both monetary fines as well as criminal charges. Additionally, the investigators may use the assistance of the Police force.

Do not leave investigators unsupervised. Staying cautious is the best way to prevent the authority from overreach.

Dawn raids undoubtfully create disruption in business activities of the party subjected to the raid and cause stress to the workers and other personnel, however, as their number is expected to increase in the following years, these tips should prove helpful in making sure that the raid is conducted as quickly and efficiently as possible.

This text is for informational purposes only and should not be considered legal advice. Should you require any additional information, feel free to contact us.

Contact:

Miloš Velimirović , Partner
milos.velimirovic@sog.rs

Dragan Martin, Associate
dragan.martin@sog.rs

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