UK and EU competition authorities launch first parallel dawn raids since Brexit

Out-Law News | 20 Apr 2022 | 3:22 pm | 2 min. read

The UK’s Competition and Market Authority (CMA) and the European Commission have conducted parallel dawn raids for the first time since the completion of the UK’s withdrawal from the European Union.

The raids took place at the business premises of several firms active in the automotive sector that are suspected of breaching competition laws governing how end-of-life vehicles (ELVs) are recycled in both jurisdictions. The Commission’s unannounced inspections involved companies and associations in several EU member states, while the CMA’s dawn raids involved a number of vehicle manufacturers and some industry bodies in the UK. Dawn raids are used by competition authorities as a preliminary step into investigating suspected anticompetitive practices.

The Commission said its dawn raids were “conducted in compliance with all coronavirus health and safety protocols to ensure the security of those involved”. Alongside the dawn raids, the Commission also sent formal requests for information to several companies active in the automotive sector.

Bret Angelique

Angelique Bret

Partner

The agencies are likely to cooperate during the course of parallel investigations where it is useful for them to do so. But these investigations are independent of each other and could potentially result in different outcomes

Angelique Bret, competition law expert at Pinsent Masons, said: “This marks the first time since Brexit that the UK and EU competition agencies have openly carried out coordinated dawn raids to investigate suspected competition law breaches. As far as we are aware, this is the first dawn raid that the CMA has openly conducted since the Covid-19 pandemic began. The Commission has been more active over this period, having conducted at least four dawn raids during 2021 and two dawn raids so far in 2022 - including the ELVs investigation.”

“Given that EU competition law no longer applies in the UK, since 31 December 2020, suspected competition law infringements affecting UK markets will be investigated exclusively under UK competition law, by the CMA, while suspected antitrust infringements with an effect on trade within the EU will be investigated by the Commission under EU competition law. The agencies are likely to cooperate during the course of parallel investigations, such as the ELV investigation, where it is useful for them to do so. But these investigations are independent of each other and could potentially result in different outcomes,” Bret added.

A spokesperson for the Commission confirmed that, in a separate incident earlier this month, it conducted a dawn raid of an employee’s home – the first for some time - in connection with an unspecified competition law investigation. The Commission said it will conduct more residential premises dawn raids in the future, as changes to working patterns spurred on by the Covid-19 pandemic result in more employees regularly working from home. The CMA said it is also more likely to conduct dawn raids of domestic premises in the future if it suspects that employees who work from home may have been involved in competition law breaches.

Tadeusz Gielas, competition law expert at Pinsent Masons, said: “Firms should ensure that they have an up-to-date competition dawn raid compliance manual in place that also includes guidance for employees working from home - in the event of residential dawn raids - and is readily accessible to employees working out of the office.”

Pinsent Masons offers a free-to-use Competition Dawn Raid Tool which behaves like a mobile app and offers immediate access to both streamlined, practical dawn raid guidance as well as relevant expert contacts.