EU Law and Practice Contributed by: Andrzej Kmiecik, Richard Burton and Catherine Gordley, Van Bael & Bellis
2. Early Stages of Cartel Enforcement 2.1 Initial Investigation Cartel investigations are typically triggered in one of four ways: • a customer or competitor may complain to the European Commission; • the Commission may open an investigation on its own initiative (ex officio investigation); • the Commission may be tipped off by an indi - vidual “whistle-blower” ; or • a participant in the cartel may submit a leni - ency application. Once an investigation is opened, the Commis - sion has wide powers of investigation and fact- finding under Regulation 1/2003. It may request information from undertakings and also has the power to carry out unannounced inspections (so-called “dawn raids” ). Following its investiga - tion, if the Commission wishes to prosecute a case, it issues a Statement of Objections (SO) to the cartel participants and provides the address - ees of the SO with an opportunity to be heard. Ultimately, the Commission issues a decision which can be subject to appeal before the EU courts. 2.2 Dawn Raids/Search Warrants The European Commission can carry out unan - nounced inspections at companies’ or company employees’ premises, and commonly conducts such inspections as part of its cartel investiga - tions. Procedure Inspections may be conducted under a simple authorisation from the European Commission, which gives undertakings the right to refuse to submit voluntarily to inspection. However, an
inspection may also be conducted under a for - mal Commission decision, which means that undertakings must submit to inspection. The Commission is empowered to enter not only the company’s main premises but also, accord - ing to Regulation 1/2003, “any other premises, land and means of transport” , including the homes of the undertaking’s employees. Howev - er, the inspection of these “other premises” can be carried out only following a formal Commis - sion decision and with the authority of a court in the relevant EU member state. Officials of the national competition author - ity of the EU member state in whose territory the inspection is to be conducted must, at the request of the Commission, actively assist the Commission in its inspection, in particular where an undertaking refuses to submit to an inspec - tion under a Commission decision. If the Commission conducts an inspection, the company being inspected should request a copy of the Commission officials’ mandate and review it, paying particular attention to whether its scope is sufficiently defined as to subject mat - ter and timeframe. The company’s external law - yers should be called immediately, and officials should be asked to wait until the lawyers are present (although the officials may not wish to comply). Companies being inspected are strong - ly advised to co-operate with any Commission inspection, as obstruction of the inspection can lead to the imposition of significant fines. Where the Commission has not finished collect - ing relevant documents during an inspection, the Commission may decide to continue the inspec - tion at its premises. In this case, a copy of the documents or data still to be searched is placed in a sealed envelope or container. The Commis -
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