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Dawn of justice

The CJEU has found that the European Commission is obliged to record interviews it conducts when collecting information for its investigations, says Alan McCarthy.

In the 9 March 2023 decisions of the Court of Justice of the European Union (Cases C-682/20P Les Mousquetaires and ITM Entreprises, C-690/20P Casino, and C-693/20P Intermarché Casino Achats), the court set aside, in part, the judgments of the General Court and annulled the decisions of the European Commission ordering inspections (dawn raids) at the premises of French undertakings in the distribution sector due to suspicions of possible anticompetitive practices.

After receiving information concerning exchanges of information between under-takings in the food and non-food distribution sector, the commission adopted, in February 2017, decisions ordering several companies to submit to dawn raids. In those dawn raids, the commission visited the premises of the relevant companies, where copies of the content of computer equipment were taken.

The dawn-raided companies brought actions before the General Court seeking annulment of the commission decisions. In 2020, the General Court upheld those actions – but only in part. Those undertakings then appealed that decision to the CJEU.

‘Any-form’ recordings

The CJEU found that the commission is required to record any interview that it conducts to collect information relating to the subject matter of an investigation. In that regard, the obligation applies irrespective of whether the interview in question was conducted before the formal opening of an investigation to collect indicators of the possible competition law infringement or afterwards, to collect evidence of a possible infringement. The commission may record the interviews in any form, including orally, thereby ensuring the effectiveness and speed of the investigation.

The General Court erred in law in holding that the obligation to record did not apply to interviews conducted by the commission with suppliers of the undertakings in question, on the ground that no investigation had yet been formally opened in respect of those undertakings.

To determine if those interviews came within the scope of the commission’s obligation to record, the General Court should have considered if they were aimed at collecting information relating to the subject matter of an investigation, having regard to their content and context. Such an examination would have led to the conclusion that those interviews had to be recorded.

Since the information obtained in disregard of the obligation to record constituted the essential elements of the indicators on which the commission’s decisions were based, they were not substantiated by sufficiently serious indicators, and the Court of Justice annulled the commission decisions.

This important judgment sets out clearly the obligations on the commission to record interviews (in this case, with suppliers of those undertakings) to be able to use such information from those interviews as indicators of a possible infringement. This places an important procedural requirement on the commission in competition-law dawn raids (and investigations in general).

Closer to home, the Competition and Consumer Protection Commission (CCPC) has wide-ranging dawn-raid powers under the Competition Act 2002 (as amended), and these are going to be materially increased as a result of the Competition (Amendment) Act 2022, which is due to commence shortly.

There are few clear procedural guidelines for CCPC dawn raids, and the CJEU’s decision throws sharp relief on the obligations on regulators to have clear procedures to protect the rights of undertakings (and individuals) under suspicion of anticompetitive practices.

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