Any company, no matter how small, can be subject to a dawn raid by authorities. Thus, every company must know what its rights and obligations are in order to respond efficiently while minimizing legal risks.
Dawn raids in Italy may be conducted by different authorities and for different reasons. Most commonly, dawn raids are conducted by administrative authorities, such as the Italian Competition Authority (AGCM), the Italian Data Protection Authority, or the Italian Tax Authority, or by public prosecutors in the course of criminal proceedings.
Despite the diversity in the types of authorities performing them and the relevant legal grounds, all dawn raids share certain common characteristics.
A dawn raid is always based on an order from the relevant authority and has the purpose of gathering evidence of possible illicit conduct. To achieve this end, the authorities usually have wide powers to search the company’s premises, examine and seize business records and documents (with some exceptions, such as legal privilege, trade secrets, protection of journalistic sources, and so on), and interview employees and company representatives.
The reactions of people dealing with dawn raids also tend to share certain characteristics: panic and disorganization.
Therefore, it is crucial to be prepared and ready to respond promptly if the authorities knock on the door, both to avoid significant consequences (such as fines or even criminal sanctions in some cases) and to ensure that the rights of the company and the limits of the powers of the investigators are respected.
Below are the questions that are frequently asked about dawn raids, along with answers designed to help you navigate dawn raids in Italy.
1. Must the raiding authority produce a mandate prior to beginning the raid?
Yes. With very few exceptions, inspectors cannot enter the premises without a proper mandate. The mandate must be provided to the party whose premises are to be raided before the raid begins.
In the case of a dawn raid in the context of a criminal investigations, a copy of the warrant must be provided and given to both the suspect (if any) and the person who has current access to the places subject to search. Should the suspect and the person who has access to the places be absent, it may be provided to a doorman or a similar figure.
2. Can the company refuse the inspection?
No. Dawn raids are carried out on a mandatory basis and people dealing with them have an explicit duty to cooperate with the raiding authorities. Indeed, obstructing them as they are carrying out their duties may result in negative consequences for the company and the people involved, such as fines or even criminal sanctions.
3. Can the raiding authorities begin their activities without the company’s lawyer?
Yes. The inspectors are permitted to begin the raid without a lawyer present, but they usually wait a reasonable amount of time (e.g., 30 minutes) for the company’s lawyer to arrive before starting a search.
4. Can the company refuse to provide confidential documents?
Yes. As a general rule, the party subject to a dawn raid can oppose the seizure of a legally privileged or otherwise confidential document. Guarantees to prevent the seizure of documents containing certain confidential information during an inspection vary depending on the type of confidentiality and type of proceeding.
For instance, the party subject to the raid can refuse to disclose documents that contain information covered by attorney-client privilege in connection with communications exchanged between the client and outside counsel (excluding internal counsel). It is then up to the raiding entity to verify whether or not there is a basis for this refusal.
To protect legal privilege in the context of antitrust raids, the European Commission instituted specific procedures aimed at protecting the confidentiality of documents when their privileged nature is disputed. Documents must be placed in a sealed envelope until privilege is ascertained. There is no specific similar provision in Italy, but many of those writing on the subject believe that the AGCM should proceed in the same way when it comes to documents for which a party raises an issue of privilege, as usually happens.
5. Must the company (or its employee) provide passwords/login credentials to the raiding entity?
Yes, if the mandate allows inspectors to request them. As a general rule, the company is required to provide raiding entities with access to the items covered by the mandate. A careful reading of the mandate is therefore crucial to understanding its scope and whether the information the raiding authorities are seeking can be provided through means that would be less invasive for the company or its employees.
6. Can employees refuse to answer questions from raiding entities?
No, unless the answer may lead to incrimination. In this case, the person interviewed may benefit from the right not to engage in self-incrimination and appoint a lawyer. In general, employees heard as witnesses are not entitled to have their lawyers present during the testimony.
7. At the end of the raid, will the inspectors draft a report?
Yes. Raiding authorities shall draft minutes of the activities carried out and the raided entity is entitled to obtain a copy. The content of the minutes varies depending on the type of dawn raid.
For instance, in criminal proceedings, the minutes of the raid do not include the questions asked and answers given, which are formally recorded in a separate report that is covered under the secrecy of the investigation and not provided to the raided party.