Brussels Court of Appeal Clarifies Obligation to Provide Statement of Reasons regarding Documents Seized during Dawn Raids

On 13 December 2017, the Brussels Court of Appeal (the “Court”) held that documents seized by the Belgian Competition Authority (Belgische Mededingingsautoriteit / Autorité belge de la Concurrence) (“BCA”) during an inspection had been legitimately included in the scope of the investigation as the BCA had provided a satisfactory statement of reasons following a court-mandated verification procedure.

In June 2011, the BCA inspected the premises of NV Distripaints and NV Novelta (the “Claimants”) during an antitrust investigation into both an alleged abuse of dominance and cartel behaviour. As the Claimants disputed the relevance of some documents seized by the BCA, the documents concerned were put in a sealed envelope for later consideration. Two years later, the BCA lifted the seal and decided that a number of documents were within the scope of the investigations. The Claimants decided to challenge this decision before the Court. The appeal was based on: (i) the alleged illegality of the inspection; (ii) the alleged abuse of rights that resulted from the unnecessarily long time period between the inspection and the lifting of the seals; and (iii) the failure to state sufficient reasons to justify the inclusion of specific documents in the scope of the investigation.

In an interim judgment, the Court partially rejected the arguments of the Claimants. It confirmed the legality of the inspection and noted that the Claimants did not contend that they had suffered injury following the long period of uncertainty between the inspection and the seal process. However, the Court did allow for the appeal to go forward with regard to the third claim. It stated in its interim judgment of 26 November 2014 that the Claimants had not been able to defend themselves properly against the brief standard statement of reasons issued by the BCA in order to justify the “in-scope” character of the seized documents.

The Court ordered the BCA to include the Claimants in the verification procedure, the purpose of which would be to have a meaningful discussion regarding the ‘in-scope’ character of the documents. First, the BCA was asked to provide a satisfactory statement of reasons for the disputed documents. In response, the Claimants had to be given the opportunity to challenge this statement of reasons. In the absence of a satisfactory reasoning, the documents must be considered “out-of-scope” and be removed from the investigation file. If the parties failed to reach a consensus, the Court would decide on the inclusion or exclusion of the documents.

Since the Parties did not reach an agreement following the ordered verification procedure, the Court was asked by the Claimants in February 2015 to review the process with regard to specific documents. Due to the reform of the Court and the creation of the new Market Court (see VBB on Belgian Business Law, Volume 2016, No. 12, p. 21 and Volume 2017, No. 2, p. 17, available at www.vbb.com), the case was only put into motion on 31 May 2017.

The Claimants submitted two requests to the Court: (i) a claim for damages resulting from the unreasonably long period of uncertainty regarding the outcome of the proceedings; and (ii) the rejection from the scope of the investigation of the documents for which the reasoning of the BCA was insufficient.

The Claimants’ claim for damages was based, firstly, on the long duration of the investigation in the period before the interim judgment of 26 November 2014 and, secondly, on the long period of time after that interim judgment. For the first period, the Court held that it had exhausted its jurisdiction by having already decided on the matter in the aforementioned interim judgment. With regard to the second period, the Court ruled that the Claimants could not recover damages on account of any uncertainty as they had themselves neglected to act by not requesting the Court to deal with the case prior to the hearing of 31 May 2017.

In their second claim, the Claimants argued that their rights to a fair trial had been violated in light of the contradictions in the original mandate of the BCA, identifying them both as a victim and an offender as regards the abuse of dominance and other antitrust allegations.

In its judgment of 13 December 2017, the Court recalled the principles set forth by the General Court of the European Union (the “GC”) in case T-289/11 Deutsche Bahn and Others v. Commission for the purposes of reviewing the statement of reasons of the European Commission (the “Commission”) accompanying seized documents. The GC established in this judgment that its review of the Commission’s statement of reasons is to “ensure that the principle of protection against arbitrary and disproportionate interventions and the rights of defence are respected […], while bearing in mind the need for the Commission to retain a specific leeway, without which the provisions of Regulation No 1/2003 would be rendered redundant […]” (Case T-289/11, para. 78).

The Court applied these principles in its review of the BCA’s statement of reasons and noted that the reasoning provided by the BCA for each individual document did not appear to be, prima facie, unacceptable, unreasonable or illegal in the context of its limited review. It concluded that the principle of protection against arbitrary and disproportionate interventions and the rights of defence had been respected and that, therefore, the documents seized could be included in the investigation.