Do Companies Have The Right To Be Heard During A Dawn Raid?

The Slovenian courts were recently asked to rule on companies' right to be heard during unannounced investigations (so-called 'dawn raids') by the Competition Protection Agency.

Facts

The agency conducted a dawn raid due to a suspicion that the company in question was in a dominant position, during which the company allegedly refused to cooperate with the agency's officials. Based on this, the agency issued a fining decision stipulating that the company had violated its duty to cooperate and imposed a significant fine on it. The agency's allegations were largely based on the following factors:

Agency representatives had to wait 54 minutes to begin the inspection. They were denied access to computers. The company employees refused to give information on the location of certain documents. Notably, the agency's report on the investigation, which was the basis for issuing the decision, neither included a detailed description of the dawn raid, nor listed or described the alleged failures.

Against this background, the company filed an action against the agency's decision, arguing that its ability to comment on the agency's findings was unlawfully limited, as the agency did not describe the alleged infringements or provide for their legal qualification in its report. By doing so, the agency violated the company's right to be heard on the facts and circumstances before the adoption of the decision, and consequently the company had no opportunity to present its opinions on the allegations, which could have shed a different light on the case.

The administrative court confirmed the agency's decision and set aside all the allegations; however, its decision was later reversed by the Supreme Court. A retrial before the administrative court followed, in which the Supreme Court's decision was incorporated accordingly and some important procedural safeguards were clarified.

Legislative framework

According to the Prevention of Restriction of Competition Act, the agency must prepare a report after completing a dawn raid. This report must include, among other things:

a brief description of the investigation; a list of statements given by representatives or employees; and a list of documents and other items that the agency obtained during the investigation. Following delivery of the report, the company under investigation has 15 days to provide its comments.

In its first decision, the administrative court held that the facts established in the decision derived...