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Short Reads

General Court delivers judgments on the scope of dawn raid decisions

The General Court delivers judgments on the scope of dawn raid decisi

General Court delivers judgments on the scope of dawn raid decisions

02.07.2018 NL law

On 20 June 2018, the General Court rendered its judgment in two connected appeals submitted by České dráhy, the Czech Railways Operator, challenging two dawn raid decisions by the European Commission. Based on arguments concerning the scope of the investigation, the Court annulled in part the first dawn raid decision and fully upheld the second dawn raid decision.

The Commission investigated an alleged predatory pricing practice by České dráhy. In the course of this investigation, it issued a dawn raid decision the scope of which was defined as including, but not limited to, predatory pricing behaviour on the Prague - Ostrava route after 2011.

Considering the information available to the Commission at the time when the dawn raid decision was taken, the Court found that the Commission did not have the right to include references to more than predatory pricing in the scope of the dawn raid decision. The Court noted that, when suspecting predatory pricing practices, the Commission's investigation can of course have the suspicion that these practices are part of a possibly wider exclusionary strategy. However, unless the Commission possesses documents pointing towards such a wider strategy, extending the scope of the dawn raid is not justified.

During the first investigation, the Commission seized general documents concerning České dráhy's costs that led the Commission to suspect other anticompetitive practices and to issue a second dawn raid decision. České dráhy argued that these documents were unlawfully seized, as they did not directly concern pricing on the Prague - Ostrava route and were hence outside the scope of the first investigation. The General Court found that the Commission was within its rights to seize the documents, since, even if they were only indirectly linked to the suspected behaviour, the Commission was entitled to seize documents relevant for determining both the direct and the indirect costs on the concerned route.

These decisions give further guidance on the Commission's powers to investigate suspected anticompetitive behaviour via dawn raids.

 

This article was published in the Competition Law Newsletter of July 2018. Other articles in this newsletter:

  1. General market studies are insufficient proof to establish dominance, two Dutch District Courts rule
  2. Excessive pricing findings set aside by UK court in prominent pharma ruling

Team

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