Antimonopoly Committee retains "raid" rights despite government moratorium

On 22 February, the Government Decree No. 1104 supplementing Law of Ukraine "On Temporary Peculiarities of State Supervision (Control) in the Sphere of Business Activity" No. 1728-VIII (the Decree) was published. The Decree confirms the list of government agencies that are allowed to conduct "dawn raids", surprise on-site inspections, and planned audits despite the moratorium on inspections. The Antimonopoly Committee of Ukraine (AMC) is one of the agencies that gained immunity and may continue to call unexpectedly to detect and investigate competition law infringements.

According to the applicable competition laws, the AMC is empowered to conduct the following types of inspections:

  • planned one, i.e. inspection with a prior notification, and
  • unannounced one, i.e. dawn raid.

In the course of conducting such inspections, the AMC has extensive powers to inter alia search for evidence supporting their suspicions of misconduct on company premises and in vehicles, while private residences can also be subject to search if approved by a court. They also retain the right to request, examine and seize documents and other information, including confidential files or business secret files. They can make copies of documents and data or seize paper documents, material or electronic evidence. They can also search and make copies of a company’s hardware and media storage, including email and document servers, PCs and laptops, hard drives, CDs, USB sticks, etc.

Historically, before the moratorium came into effect, the AMC was more active in its inspections. To compare, in 2014 the AMC conducted 217 inspections, which was four times less than in 2013. In the following years, according to the AMC's annual reports, the regulator has scaled down its inspection activity by carrying out 87 inspections in 2015 and 118 inspections in 2016. Despite the fact that the figures for 2017 are not yet available, we know that the numbers would not differ significantly. While we do not expect extreme increase in inspections, the Decree allows the AMC to inspect the business in the due course in 2018 just as well.

For any further information or clarification, please feel free to contact Vladimir Sayenko, Valentyna Hvozd or Oleksandr Nagorny.