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Label legally-privileged docs, advises MHC

More than two-thirds of organisations (68%) have to deal with regulatory investigations either frequently (36%) or occasionally (32%), a survey from business law firm Mason Hayes & Curran (MHC) LLP has found.

The findings come in the wake of a recent wave of unannounced regulatory searches, known as dawn raids, carried out by regulators including the Competition and Consumer Protection Commission (CCPC), and the Commission for Communications Regulation (ComReg).

Those surveyed said that:

• More than two-thirds (68%) have to deal with regulatory investigations frequently (36%) or occasionally (32%),
• Ensuring legal compliance is the biggest concern when dealing with regulatory searches (52%),
• Almost two-thirds (64%) are not confident in disputing seizures of privileged material.

The survey of 200 industry professionals was carried out at the firm’s annual update on regulatory investigations and prosecutions.

The event offered practical advice to companies in dealing with regulatory investigations.

Scrutiny

Partner Shane Reynolds said: “Our findings highlight the increasing regulatory scrutiny that businesses are facing. This increase in regulatory activity is expected to continue in view of the CCPC’s and ComReg’s newly acquired powers to impose significant administrative fines.

“Our advice to companies is to be proactive in keeping pace with the current regulatory environment. Understanding the latest court rulings and how they impact your industry can help you stay one step ahead of potential issues.”

The heightened scrutiny has posed challenges for businesses. For more than half of respondents (52%), ensuring compliance with legal procedures is the top concern when dealing with dawn raids or other regulatory searches.

Fiona McNulty (health and prosecutions partner) said: "Legal compliance during searches is not just a procedural necessity; it's a safeguard against potential legal liabilities and penalties.

“For instance, during a dawn raid, having a well-rehearsed protocol in place can prevent the accidental disclosure of privileged information. This could otherwise result in significant fines or legal challenges.

“It is crucial for companies to regularly review their compliance procedures, conduct internal audits, and ensure their staff are trained to handle regulatory searches and enquiries effectively,” McNulty said.

The survey showed that almost two-thirds of respondents were not confident in disputing seizures of privileged material, underscoring potential vulnerabilities.

Confidential communications

Privileged material refers to confidential communications between a lawyer and their client, which are protected from disclosure in legal proceedings.

Shane Reynolds added: “Without the confidence to effectively challenge these seizures, organisations risk exposing sensitive information that could be detrimental in legal proceedings.

“This lack of confidence often stems from insufficient legal knowledge and preparedness, highlighting the need for specialised training and robust legal support. We also advise clients to engage early with regulators to manage document reviews and ensure confidentiality.

“Labelling privileged documents and having a legal team ready to challenge improper seizures can make a significant difference. Without such precautions, companies risk exposing sensitive information that could be detrimental in legal battles."