Pursuant to recent amendments to the Romanian Competition Law no. 21/1996 (the "Competition Law"), prior court authorisation is mandatory for dawn raids carried out by the Romanian Competition Council (“RCC”) in relation to both private and public premises. In addition, the law now expressly qualifies the persons subject to incrimination under the Competition Law criminal offences, and provides for the right, under certain conditions, for offenders to benefit from immunity or a reduction of the applicable sanction.
Mandatory court authorisation for RCC dawn raids
Dawn raids carried out by the RCC will now require a prior court authorisation, irrespective of whether business or private premises are inspected. Prior to the legislative changes, court authorisation was a requirement only for inspections carried out on private premises, similarly to the procedure of the EU Commission under EU Regulation 1/2003. Now, the RCC is under a legal obligation to request authorisation from the Bucharest Court of Appeal.
Incrimination and leniency conditions for Competition Law criminal offences
The Competition Law now limits criminal liability to persons holding a management position within the undertaking involved in an infringement of Article 5(1) of the Competition Law (the corresponding legal provision of Article 101(1) TFEU): manager(s), legal representative(s) or any other person in a management position who intentionally conceive(s) or organize(s) one of the prohibited practices are subject to criminal liability. The amendment seems to focus the criminal liability on the persons who masterminded the infringement (i.e. those involved in the conception and organisation), as opposed to simple participants/followers.
Under the new provisions, leniency is now available to the offender, subject to express conditions. Immunity from punishment is granted if: (i) before initiation of criminal proceedings, the person informs the prosecution authorities of his/her participation in the infringement and (ii) the information provided leads to the identification and sanctioning of the other offenders. After initiation of criminal proceedings, the offender may benefit from a reduced sanction of up to half of the limits set forth by the law, provided that the above conditions are met. However, leniency is not available to offenders involved in collusive public tendering for the purpose of distorting the bidding price.
Finally, the imprisonment sanction for the criminal offence was increased from three years to a maximum of five years.
The business environment welcomes the legal amendments in respect of dawn raids. The mandatory prior judicial authorization procedure for all RCC dawn raids may bring additional safeguards for the benefit of the undertakings concerned, limiting the possibility of arbitrary decisions and/or the exercise of inspection powers in an abusive manner.
The possibility for individuals to benefit from immunity from criminal sanctions in respect of competition law infringements (or at least a substantial reduction of the sanction) may bring a breath of fresh air into the leniency program, an area which is currently underdeveloped in Romania, in part due to the fear of criminal liability.