Competition law dawn raids and surveillance in Ireland – What would the Competition (Amendment) Bill 2022 change?
If enacted as currently drafted, the Competition (Amendment) Bill 2022 (Bill) would give effect to Directive (EU) 2019/1 (ie ECN+) by further empowering the Competition and Consumer Protection Commission (CCPC)) to investigate and enforce EU competition law in Ireland. The Bill is structured so that those additional powers also apply to the investigation and enforcement of Irish competition law.
The Competition and Consumer Protection Act 2014 (CCP Act) contains the powers of the CCPC to carry-out unannounced inspections (ie dawn raids) in relation to breaches of EU and Irish competition law (ie anti-competitive arrangements and abuses of dominance). The Competition Act 2002 (as amended) (Competition Act) contains the main provisions applying EU and Irish competition law in Ireland.
Currently, the CCPC (through its authorised officers and often accompanied by seconded members of the Irish police (ie the Garda Síochána)) has a range of dawn raid powers under the CCP Act. Separately, the CCPC assists the European Commission (Commission) on dawn raids in Ireland regarding EU competition law under Regulation (EC) 1/2003 (as well as assisting national competition authorities of other Member States in Ireland).
The main competition law dawn raid powers of the CCPC are to obtain information from undertakings, on production of a warrant, by entering (if necessary by reasonable force) and searching places where relevant activities are carried on by undertakings. In addition, the CCPC can search for, copy, seize and retain books, documents and records relating to those activities as well as requiring persons to give certain information to the CCPC. It is an offence to obstruct or impede the CCPC in the course of its dawn raids under the CCP Act.
Enhanced dawn raid powers under the Bill
On a dawn raid regarding an investigation into a breach of EU or Irish competition law, the Bill provides (or to some extent clarifies) that the CCPC would be able to:
(a) search any place at which books, documents or records relating to a relevant activity is kept (including, any place occupied by a director, manager or any member of staff)
(b) search any vehicle relating to a relevant activity
(c) seize and retain any computers or any other storage medium in which any record is kept relating to a relevant activity
(d) take "any other" steps which appear necessary to the CCPC to preserve or prevent interference with relevant information including:
- taking or obtaining, in any form, copies of such information
- continuing, at any time, to search such information seized or copied "at a premises other than the premises" dawn-raided - this may well include, in practice, at the CCPC's offices
(e) require any person (who appears able to facilitate access to documents or records stored in any data equipment or computer) to provide the CCPC with all reasonable assistance regarding the operation of that equipment or access to the stored records, including by:
- providing the documents or records to the CCPC in a form in which they can be taken (and are (or can be made) legible and comprehensible)
- giving to the CCPC any password necessary to make the documents or records legible and comprehensible
- otherwise enabling the CCPC to examine the documents or records in a form in which they are legible and comprehensible
(f) where the CCPC considers it necessary to preserve records and documents "or any other matter", secure for later inspection:
- documents or records accessed or found during the dawn raid, and any data equipment (including any computer), in which those documents or records may be held
- a place dawn-raided by the CCPC
"Records" would include any form of data or digital communications.
As part of a dawn raid regarding an investigation by the CCPC, breaking a seal affixed by the CCPC to secure any document, record, data equipment, computer or place would be a breach of a procedural requirement under the Bill – this could lead to an "administrative financial sanction" of up to the greater of €1 million and 1% of worldwide turnover of the undertaking involved.
While investigating a breach of EU or Irish competition law, the CCPC would be able to require an undertaking (or person) under investigation, in writing, to provide the CCPC with information connected to, and reasonably necessary for, the CCPC's investigation.
Separately, the Bill would enhance the Commission for Communications Regulation's (ComReg) EU and Irish competition law dawn raid powers under the Communications Regulation Act 2002 regarding electronic communications and postal services matters. ComReg has certain co-competition powers with the CCPC.
Competition law surveillance under the Bill
The Criminal Justice (Surveillance) Act 2009 (Surveillance Act) provides for powers of surveillance in connection with the investigation of arrestable offences.
The Bill would add (essentially) cartel offences under the Competition Act to the current list of offences applicable under the Surveillance Act. The CCPC would be able to apply to a District Court judge for a surveillance authorisation where it had reasonable grounds for believing that, as part of an investigation, the surveillance sought was necessary to obtain information including:
- whether the offence had been committed
- as to the circumstances relating to the commission of the offence
An authorisation may also be applied to obtain evidence for proceedings regarding the offence or to prevent the commission of the offence.
An authorisation would allow the CCPC to enter (if necessary by reasonable force) "any place" to carry-out the authorised surveillance.
In certain circumstances, the CCPC would be able to carry out such surveillance without the authorisation of a judge – eg where information or evidence in relation to the commission of a cartel is likely to be destroyed, lost or otherwise become unavailable. In addition, the CCPC would be able to monitor persons using a tracking device in certain circumstances.
Surveillance means:
(a) monitoring, observing, listening to or making a recording of a particular person or group of persons or their movements, activities and communications
(b) monitoring or making a recording of places or things
by or with surveillance devices (ie designed or adapted for use in surveillance (with some exceptions)).
Comment
ECN+ mandates increased enorcement powers for national competition authorities and the Bill reflects these in relation to the CCPC. However, the Bill goes further (in particular regarding the new powers of surveillance). In Ireland, the CCPC has always had wide-ranging investigation and enforcement powers but competition law dawn raids have not been frequently used by the CCPC in recent years (irrespective of the effect of COVID-19). While still too early to tell, the tenor of the Bill suggests likely increased investigation and enforcement of EU and Irish competition law (particularly on the civil side) by the CCPC. This may involve more dawn raids by the CCPC (perhaps also taking a lead from the Commission's recent increase in the use of dawn raids). The new EU and Irish competition law investigation and enforcement provisions under the Bill would add (and in some cases clarify) the CCPC's already significant powers.
For further information, in relation to this topic, please contact Alan McCarthy, partner or any member of ALG's EU, Competition & Procurement team.
Date published: 7 March 2022