Introduction

In 2003 the European Court of Human Rights (ECHR) ruled that the dawn raid carried out by the Czech Office for Protection of Competition (CCA) on Delta Bakery's premises infringed the company's right to a fair trial, breached other fundamental rights and violated Article 8 of the European Convention on Human Rights (for further details please see "Competition Authority cannot perform dawn raids without prior judicial approval"). According to the ECHR, Czech law did not provide the procedural guarantees necessary to prevent the competition authority from abusing its power. The case was reopened before the Constitutional Court.

Before the ECHR judgment, dawn raids required a judicial warrant only when they were conducted on private premises, not business premises.

CCA's response

At a conference held in Brno in November 2014, the CCA declared that it had been paralysed by the ECHR's decision and had thus put all planned dawn raids on hold in order to evaluate the impact of the judgment. CCA Vice-Chair Michal Petr confirmed that the CCA could perform dawn raids only with prior judicial approval, unless a legislative change was made. Petr also revealed that the CCA was scrutinising the judgment and looking for a solution in order to resume dawn raids.

On February 19 2015, at a CCA conference in Brussels, Petr announced that the CCA would once again begin conducting dawn raids on business premises without prior judicial warrants. Petr's statement was confirmed and, as of February 19 2015, the CCA resumed dawn raids on business premises.

According to Petr, the CCA, in cooperation with the court, concluded that there is no systemic problem in the Czech legal system in this regard. He declared that Delta Bakery was an extremely specific case and that the CCA was not obliged to infer general conclusions from the case. He also pointed out several discrepancies in Delta Bakery.

The CCA further stated that the absence of a judicial warrant is justified by a follow-up judicial review of the legality of the dawn raid, based on Section 65 of the Code of Administrative Justice.

Comment

However, a judicial review based on Section 65 does not comply with the requirements set out in Delta Bakery and other ECHR and General Court case law.

According to the relevant case law, any administrative intervention of the rights of a physical or legal person must be approved by the court, either ex ante or ex post. As General Court case law has already stated in relation to dawn raids conducted by the European Commission – which also performs dawn raids without prior judicial approval – the absence of prior judicial authorisation is counterbalanced by subsequent judicial review. However, judicial review must be immediate. Judicial review based on Section 65 is not immediate, as the parties to the proceedings must wait until a decision on the merits of the infringement is in force. Further, appeals regarding the legality of CCA dawn raids can take up to two years. This lengthy process does not fulfil the procedural guarantees necessary to prevent the CCA from abusing its power.

As of February 19 2015, any company in the Czech Republic may be subject to a CCA dawn raid without a prior judicial warrant. Thus, companies should establish dawn raid policies and inform their employees about the issue to ensure that they fulfil their legal obligations and guarantee that their rights are duly respected in the event of a dawn raid.

Despite the CCA's new approach, raided companies should request that the CCA produce a judicial warrant, referring to the ECHR judgment. If the CCA enters a premises without a warrant, the company should record its objection and the CCA's failure to comply with the ECHR's ruling and Article 8 of the European Convention on Human Rights in the dawn raid protocol. This approach may help raided companies to contest all evidence obtained during a raid.

For further information on this topic please contact Jitka Linhartová at Schoenherr by telephone (+420 225 996 500) or email (j.linhartova@schoenherr.eu).

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