CMA wins legal challenge against CAT on home search warrants
The CMA has won an important legal challenge in the High Court after the CAT refused to grant it a domestic search warrant as part of a cartel investigation.
- CMA wins on all 3 grounds of judicial review
- High Court says CAT “erred in law” when it refused to grant the CMA a warrant to enter a domestic property, and “exceeded its powers” in other respects
- CMA CEO: “With the increase of remote-working – and electronic communication – it’s essential that we’re able to search domestic premises to secure evidence of potential breaches of competition law where appropriate to do so”
The High Court has today found comprehensively in favour of the Competition and Markets Authority (CMA) – on all 3 of its grounds – after the CMA sought judicial review of certain decisions made by the Competition Appeal Tribunal (CAT) relating to search warrants.
In October 2023, the CMA applied for warrants to search business and domestic premises as part of its investigation into suspected anti-competitive conduct regarding the supply of chemical admixtures for use in the construction industry. The CMA conducted raids to gather evidence as part of its investigation.
While the CAT granted warrants authorising the CMA to search 3 business premises in England and Scotland, it refused the warrant regarding the domestic property. The CAT said it was necessary for the CMA to identify specific evidence demonstrating that an occupier of the property had a “propensity” to destroy physical or electronic documents held on their property – as their suspected involvement in a secret cartel was not enough.
The CMA was concerned that the CAT’s decision would damage its ability to gather the necessary evidence to effectively investigate and enforce against secret cartels, particularly given the CAT’s indication that the warrants judgment was a guideline case to be followed in the future. As such, the CMA applied to the High Court for judicial review in December 2023.
The High Court agreed with the CMA that the CAT had made an error in its application of the law – namely, that it was incorrect to state that specific evidence of a “propensity” to destroy electronic or physical documents was always required for a domestic search warrant, and that the CAT’s judgment should not therefore be followed in future cases.
Sarah Cardell, Chief Executive of the CMA, said:
We welcome this important ruling from the High Court, which found comprehensively in our favour on all 3 grounds.
The original judgment by the Competition Appeal Tribunal risked seriously undermining our ability to enforce effectively against illegal cartels.
With the increase in remote-working – and electronic communication – it’s essential that we are able to search domestic premises to secure evidence of potential breaches of competition law where appropriate to do so.
For more information, see the CMA’s case page: Suspected anti-competitive conduct in relation to the supply of chemicals for use in the construction industry.
Notes to editors
- The judgment of the High Court is available to read on the CMA’s case page.
- The CMA has the power under section 28 (in respect of business premises) and under section 28A (in respect of domestic premises) of the Competition Act 1998 to seek search warrants from the High Court in England and Wales, the Court of Session in Scotland, the High Court of Justice in Northern Ireland or alternatively the CAT, in support of its investigations under section 25 of the Competition Act 1998. The test under both section 28 and 28A provides that the relevant court or the CAT (as applicable) may grant a search warrant if it is satisfied that there are reasonable grounds to suspect that there are documents on the premises which the CMA could require the production of by notice (under section 26 of the Competition Act 1998) but “if the documents were required to be produced, they would not be produced but would be concealed, removed, tampered with or destroyed”.
- The decisions of the CAT that were challenged by the CMA related to the 3 following judgments / orders of the CAT: Warrant Applications Oct 2023, Warrant Applications Nov 2023, and Warrant Applications Dec 2023.
- Anyone who has information about a cartel is encouraged to call the CMA cartels hotline on 020 3738 6888 or email [email protected].
- For media enquiries, contact the CMA press office on 020 3738 6460 or [email protected].