Antitrust regulators scrutinize instant messaging in Dawn Raids probe

Authors: Bernd Meyring, Thomas Elkins and Liliane Gam (Linklaters)

On June 24, the European Commission fined International Flavors & Fragrances (IFF) €15.9 million for deleting WhatsApp messages during a dawn raid, the first time that deleting phone messages led to a fine for obstructing work from the EC.

This blog post discusses what to look out for during dawn raids, the implications for cooperation obligations, and steps businesses can take to avoid being fined for obstructing raids.

Antitrust authorities focus on electronic documents and devices

As communications increasingly move to digital formats, electronic documents and digital devices have become a focal point of antitrust investigations. In a dawn raid, one of the first steps antitrust authorities take is to gain investigators access to a company’s entire IT environment. But the IT environment now encompasses much more than desktops and office servers, including:

• Instant messaging such as WhatsApp and other text messages, including “fleeting” messages.
• Digital devices, including smartphones, tablets and laptops, and even personal devices if they are used for business purposes.
• Data stored in the cloud.

From the outset of an investigation (whether as part of a dawn raid, a request for information, or a decision to open an investigation), companies under investigation are subject to a general obligation not to conceal, alter, or destroy documents. This obligation extends to those seeking lenient penalties outside the context of a dawn raid. A breach of this obligation constitutes obstruction and can result in significant fines (and, in some jurisdictions, criminal charges).

Summary: It can be expected that antitrust authorities will focus primarily on digital evidence, including private devices used for business purposes.

Authorities around the world are adapting to digital advances and have the technology and determination to detect attempts to hinder investigations by destroying digital messages or manipulating devices, as evidenced by the recent fine imposed on IFF by the EC, Ofcom’s decision to fine Sepura and recent guidance issued in the US.

Penalty for obstructing IFF traffic

The European Commission fined IFF for obstructing its work when a senior employee deleted WhatsApp messages exchanged with a competitor. The messages were deleted after the employee was informed of the European Commission inspection, which the European Commission considered to be a factor in making the breach “very serious.” The employee did not disclose the deletion to the European Commission, which could be considered a mitigating circumstance. The deletion was discovered when the employee’s mobile phone was examined by the European Commission’s computer forensics team.

Summary: It is expected that antitrust authorities will have the forensic tools necessary to detect deletion or manipulation of electronic information, including instant messaging.

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