Uptick in fines for obstruction of dawn raids

Legal News
Companies being investigated for infringements of the competition rules may face substantial fines for acts obstructing unannounced inspections (dawn raids), such as deleting data or providing incorrect or misleading information, even if no substantive competition law infringement is ultimately found. In recent years, there has been an uptick in fining decisions regarding obstruction of dawn raids from several competition authorities across the EU. For instance, the European Commission fined a company EUR 15.9 million because a single employee had deleted WhatsApp messages during a dawn raid. This underscores the importance of companies preparing for potential dawn raids.

Background

As part of efforts to investigate potential infringements of the competition rules, the European Commission ("EC") and national competition authorities ("NCAs") frequently conduct unannounced inspections – colloquially referred to as "dawn raids" – at the premises of companies and (less frequently) their executives and employees for the purpose of collecting evidence and information on suspected infringements.

During dawn raids, authorities may generally enter and examine, for instance, offices and vehicles and copy any information relating to the company under inspection, irrespective of the medium on which the information is stored. This typically involves the inspecting authority performing data extractions from the company's IT systems of all data relating to certain employees or certain parts of the business, as well as from computers, tablets and mobile phones of relevant employees.

Under EU Regulation 1/2003 and corresponding national legislation, companies are required to submit to dawn raids decided by the EC or an NCA (sometimes subject to a court order), and a company may be fined for refusing to do so or for otherwise obstructing an inspection, for instance by destroying documents or deleting data, by producing documents or data in incomplete form, or by giving incorrect or misleading information.

Case law on obstruction of dawn raids has historically been limited. In a few cases, the EC has issued separate fines for obstructions of dawn raids (see cases AT.39796, Suez Environnement, AT.39326, E.On, and AT.39793, EPH), and in other cases, the EC has instead considered obstruction an aggravating circumstance in relation to the infringement of the substantive competition rules (see cases AT.38354, Industrial Bags, AT.38432, Professional Videotapes, and AT.38456, Bitumen Nederland). 

Recent case law

In recent case law, the EC and various NCAs have opted for treating obstructions as standalone infringements of the procedural competition rules and have issued separate decisions and substantial fines relating to such behavior.

This includes:

  • Decision of 24 June 2024 by the EC regarding IFF - EUR 15.9 million: 
    International Flavors & Fragrances Inc. ("IFF"), a US company operating in the specialty chemicals industry, and its French subsidiary IFF France SAS were fined EUR 15.9 million because a single (senior) employee had intentionally deleted WhatsApp correspondence with a competitor during the dawn raid. This was discovered by the EC’s forensic IT experts during their subsequent review of data secured from IFF employees' mobile phones. The fine corresponded to 0.15% of IFF's total annual group turnover, but this was after a 50% reduction due to "proactive cooperation during and after the inspection" by IFF. Otherwise the fine would have been set at a level corresponding to 0.3% of IFF's total annual group turnover. The EC's assessment of the appropriate size of the fine is likely to be a persuasive precedent for NCAs, in particular in jurisdictions where there is no existing national case law.
  • Decision of 30 September 2024 by the Greek NCA regarding Motor Oil Hellas - EUR 9.2 million + EUR 50,000: 
    Motor Oil Hellas, a Greek company operating in the energy sector, was fined EUR 9.2 million and the company's CEO was personally fined EUR 50,000 for denying the NCA access to the CEO's office. Motor Oil Hellas has contested the decision, arguing that the office space in question constitutes private property, with the office just happening to be located in the building that also houses the headquarters of Motor Oil Hellas. Interestingly, the NCA has apparently discontinued the underlying competition case, highlighting the tendency towards authorities pursuing obstruction cases on a standalone basis.
  • Decision of 31 March 2025 by the Finnish Market Court regarding Attendo - EUR 1.5 million: 
    Attendo Suomi Oy, a Finnish company operating in the care services sector, was fined EUR 1.5 million because one employee had deleted work-related WhatsApp messages during the dawn raid conducted by the Finnish NCA. The NCA had sought a fine of EUR 4.4 million, but the Market Court decided to impose a lower fine, taking into account, inter alia, that (i) Attendo had taken steps to prevent this sort of behavior by hosting seminars on how employees should conduct themselves in the event of dawn raids, (ii) the legal director of Attendo had instructed the employee in question during the dawn raid specifically not to delete his messages, and (iii) Attendo had itself become aware of the deletion of messages, restored the deleted messages, and shared a copy with the NCA.
  • Decision of 9 October 2024 by the French NCA regarding Loste group - EUR 0.9 million: 
    Loste, CA Animation and CA Conseils et Services (all part of the Loste group, a French group operating within the food product industry) were jointly and severally fined EUR 0.9 million for obstructing a dawn raid at the companies' premises. During the dawn raid, the legal director of CA Conseils et Services knowingly gave false and misleading information by informing the NCA that the head of the Loste group was not present at the premises, despite having just seen him on premises and alerted him of the ongoing dawn raid. Moreover, after the dawn raid, the head of the Loste group knowingly provided false and misleading information by telling the NCA that he had been away on business in the UK.

Plesner's comments

The recent case law indicates an increased willingness by competition authorities in the EU to investigate and sanction obstructions of dawn raids, even where no substantive competition law infringement is ultimately found – or even pursued. 

Furthermore, it illustrates that obstruction can take many forms, and that even acts or omissions by individual employees can result in substantial fines. 

This underscores the importance of companies preparing for potential dawn raids. In particular, companies may benefit from:

  • preparing guidelines/protocols for, and conducting employee training on, how company representatives should act in the event of a dawn raid, as this may both reduce the risk of obstructions and contribute to a reduced fine in case obstructions still occur; 
  • ensuring that IT staff are equipped to respond to a competition authority's data requests, as failure to do so could in itself constitute obstruction, and to restore any files that may have been deleted by employees, as this may contribute to a reduced fine; and
  • conducting general competition law compliance training, as this may reduce the risk of competition law infringements and, in turn, the risk of dawn raids.

Plesner frequently assists clients during and after dawn raids by the Danish NCA (including where it assists the EC or another NCA), and can advise on all aspects of dawn raid preparedness. 

Do you want to know more?

Please contact Plesner's EU and Competition Law team for a copy of our standard dawn raid guidelines or to discuss potential opportunities for training on dawn raid preparedness and/or competition law compliance training. 

The full texts of decisions mentioned above are available on the relevant authorities' websites:

 

Related news

See all