As mentioned in our previous articles, if the Hong Kong Competition Commission (the "Commission") proceeds to a formal investigation, it will have at its disposal a full arsenal of investigative tools to obtain evidence of infringement.
You may recall that the Commission's investigation powers include:
The power to request information or documents; The power to request any person to appear before the Commission to answer questions; and The power to carry out on-the-spot inspections (so-called "dawn raid"). A dawn raid is a surprise inspection at a company's premises by officials of the Commission. Dawn raids get their name from the inspectors' habit of turning up at the beginning of the business day to guarantee an element of surprise and minimise any disruption to the search.
A dawn raid can be a stressful event for a company and its employees. Companies should therefore ensure that they are well prepared for any potential dawn raid.
Be Ready When the Inspectors Arrive
A dawn raid requires a speedy and adequate response. Receptionists and security staff should be trained and prepared to inform management of the dawn raid upon arrival of the officials.
Officials generally arrive in teams comprising of at least two Commission officials and IT experts, and officials may conduct simultaneous investigations at various companies or business locations. It is also important to keep in mind that dawn raids may not be confined to the premises of a company which is under investigation. For instance, the search can extend to the premises of the investigated company's suppliers or customers.
When the inspectors arrive, you are advised to take the following steps:
Contact relevant in-house or external legal advisors to assist in dealing with the officials. The Commission has indicated that it will wait a reasonable time for external counsel to arrive before commencing a search, provided that this will not adversely affect the investigation. Check the officials' ID documents and request documents evidencing their authorisation to investigate. The Commission is required to obtain a warrant from a judge of the Court of First Instance in order to conduct a dawn raid. Note the authorised scope of the investigation and ensure the officials limit their search and questioning to these matters. Designate an appropriate person to be the point of contact with officers of the Commission during the search. What Happens During an...