Cartels and investigations

Renewed cartel investigation activity highlights need to have expert defence at hand

A competition investigation is a huge pressure for any business; a wrong move can lead to potentially costly outcomes, including – in addition to fines and disrepute – liability for cartel damages. The ability to defend a company properly in a cartel investigation is crucial when faced with potentially severe sanctions. Fines can involve multi-million sums and, in some jurisdictions, individuals can be imprisoned for collusion.

Board-level decisions

Immediate top management attention is vital. A boardroom-level decision is likely to be needed on how a business is to defend itself in a cartel investigation. Decisions have to be made on whether to cooperate, to blow the whistle, to apply for leniency or to opt for settlement, which can lead to a reduction of fines but can reduce the ability to appeal. 

Investigations can involve dawn raids and searches of premises, including interviews and gathering electronic documents. Although the number of dawn raids and the risk of the discovery of cartel activity fell during the pandemic, the rate of investigation has increased. 

Companies need to be able to defend themselves with effective actions when investigated. What happens when the server is located in a different jurisdiction and what search warrants are needed? What happens when employees are working from home: what are the rules to search homes? These situations require clear negotiation tactics and legal guidance.

Multiple jurisdictions

Cartel investigations often take place in multiple jurisdictions. Companies might need to ensure constitutional rights are not violated and this advice might be required on a multi-jurisdictional basis. Fines might need to be negotiated, with competition authorities often enjoying significant margins of discretion.

Moreover, authorities are enhancing their investigation powers with more sharing of data and improved cooperation with the courts. With procedures also under review in Europe and elsewhere, companies need to be ahead of regulatory changes – and, with the right lawyers by their side, be prepared and sure of a proper defence.

Osborne Clarke has proven capabilities providing multijurisdictional defence across a range of sectors from the international travel industry to global automotive suppliers and media companies. Our pan-European team has been involved in high-profile investigations, advising clients throughout all stages from compliance programmes and training to dawn raids and responding to authorities and appealing decisions.

Defences across Europe

We have a strong cartel damages practice, bringing and defending claims across Europe. Our specialist competition experience means that we give commercially focused advice on cartel claims and damage disputes from the moment they arise. Our team has represented clients in public and private enforcement, before the highest national courts as well as the European Court of Justice.

The ability to defend a company properly in a cartel investigation is crucial.