Dawn raids raise the stakes in competition enforcement

Pedro Callol

The entry into force in September 2007 of a new Spanish Competition
Law has brought a dramatic rise in the regulatory emphasis against
cartels, says Pedro Callol, Head of Competition at Roca Junyent. The
result being that the first leniency applications are now on the horizon.

La promulgación el año
pasado de la nueva ley
de la competencia ha
comportado cambios
fundamentales respecto
al contexto regulatorio
en España, y con esto,
un incremento de los
poderes de investigación
y de ejecución por parte
de las instituciones
locales (NCC), afirma
Pedro Callol, Director del
departamento de
competencia de Roca
Junyent. Las empresas
deben por lo tanto
entender la lógica que
ampara estos nuevos
poderes y saber cómo
gestionar las
problemáticas que
puedan surgir.

The entry into force in September 2007 of
a new Spanish Competition Law has
brought a dramatic rise in the
regulatory emphasis against cartels, says
Pedro Callol, Head of Competition at Roca
Junyent. The result being that the first
leniency applications are now on the horizon.

'There is no doubt that the recent
legislative changes have brought a renewed
vigour to the activities of the new National
Competition Commission (NCC) by bringing
its powers in line to those already enjoyed by
regulators across Europe,' he says.

Notable say some, has been the new
emphasis of the NCC on consumer goods
businesses as concerns over rising inflation
and declining economic activity increase.

'Some public authorities have commented
on an apparent link between cartel type
activities and rising prices, or at least less
competitive prices. The NCC has notably paid
a lot of attention to food, detergent, cosmetic,
wine and petrol prices – which they say are
not always reflective of falls in the price of
oil,' says Callol.

The changing regulatory framework has
also brought with it new investigatory and
enforcement powers to the NCC, including
the ability to conduct 'dawn raids' in the
fight against cartel activity.

'Dawn raids can be among the most
intrusive actions the State can make on a
company, enabling the NCC to seize
documents and IT equipment, including
blackberries and mobile phones. It can place a
huge strain on employees so it is important
that they are prepared and that the correct
strategies are in place to deal with such
situations,' believes Callol.

There is a growing perception, he adds,
that a number of recent actions have been
sparked by competitors as a direct result of
leniency applications made through the
NCC's new whistle-blowing procedures.

'A number of dawn raids have taken place
over the summer in connection with which
the courts will have to decide in due course.
Likewise, a number of actions in the antitrust
damages arena are now pending in court.
These present a very important step forward
in our new competition regime. The entire
competition landscape is changing.”

Dawn raids raise the stakes in competition enforcement

Garcia-Sicilia

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