18 December 2015

Preparing for Competition Commission investigations

This article was written by Neil Carabine, Edmund Wan, Martyn Huckerby and James Wilkinson. 

The Competition Commission has the power to carry out investigations into suspected contraventions of the Competition Ordinance, including unannounced “dawn raids”. This article provides tips on preparing for and responding to investigations.

Dawn raids

The Commission may apply to the Court for a search warrant to enter and search premises for documents that may be relevant to an investigation (known as a dawn raid). A warrant gives the Commission the power to copy and/or confiscate documents and equipment (such as computers) found on the premises.

Preparing for dawn raids

A company can adopt the following steps to prepare for dawn raids:

1. prepare a dawn raid manual and circulate to all employees. The manual should include:

  • a description of what the Commission is permitted and not permitted to do during a dawn raid;  
  • and the actions employees should take in responding to the raid; and

2. carry out training for employees, especially receptionists, managers, financial staff, sales staff, IT staff and in-house lawyers.  Training may include running a “mock” dawn raid.

During a dawn raid

Arrival of Commission officials

Employees should co-operate with the Commission officials. However, employees should also behave properly to best protect the company’s legitimate interests.

When the Commission officials arrive:

  • senior staff or in-house legal counsel should check the search warrant and the officials’ identification;
  • ask the officials to wait until in-house or external legal counsel is present before commencing the search. The Commission officials will wait a reasonable time for legal counsel to arrive;
  • request the Commission to direct all queries to a single contact person. The contact person can be the in-house or external legal counsel or a senior executive.


Each official should be shadowed at all times by at least one employee or legal adviser. Employees should immediately contact a member of the legal team if they see any unattended officials in the building.

Note taking

Take written notes of all:

  • areas searched by the officials;
  • documents copied or taken away by the officials; and
  • questions asked and responses to the questions.

Copying and seizure of documents and equipment

The Commission may make copies of relevant documents found on the premises. If it is not reasonably practicable to take copies (for example, if there is a large number of documents), the Commission may take possession of the documents. In that case, ask the Commission to provide a certified copy of each document seized as soon as possible after the search.

The Commission may also copy or seize computers and similar devices. Request an image copy of any data copied or seized.

Before any documents or IT data or equipment are removed, an index should be created and agreed with the Commission which records each item removed. In the case of documents this index should contain a description and the number of pages of each document.

Responding to the officials’ questions

A search warrant provides the Commission with power to require any person on the premises to give an explanation of any document appearing to be a relevant document or to state, to the best of his or her knowledge and belief, where such an explanation may be found or obtained.

Legal counsel should be present whenever questions are addressed. Make sure that each question and answer has been recorded. If an employee is unsure whether they are required to answer a particular question, they should politely ask to consult privately with the legal team.

Legal professional privilege

The Commission is not entitled to review documents that are protected by legal professional privilege.  Ask the Commission officials not to read or copy privileged documents.  If the Commission intends to seize privileged documents, request that the documents be sealed and not viewed until the privilege claims are resolved.

Confidential information

Inform the officials if there is any confidential information in certain documents. A company may not refuse to produce a document merely because it is confidential. However, the Commission must protect the confidentiality of the documents in accordance with the Competition Ordinance.


Obstructing the execution of a search warrant is an offence, punishable by imprisonment for up to two years and a fine of up to HK$1 million. Employees responding to a dawn raid should therefore take care to comply with the requirements of the warrant.

After the raid


Commission officials are permitted to seal individual rooms or parts of premises overnight if the search continues for a second day. The purpose is to protect and preserve evidence. Great care must therefore be taken that any seal once applied is not tampered with in any way (e.g. by cleaning staff). Always consider employing a security guard to protect any sealed doors.


After the officials have left the premises, immediately hold a debriefing meeting with staff involved in the dawn raid. Staff should report the information/documents taken by and questions asked by the officials. Advise staff not to inform third parties or other staff (not involved in the raid) that the raid occurred.

Next steps

Plan the next steps, including considering any leniency applications (after evaluation by external legal counsel), publicity and staff morale.

Notices to produce documents or information / answer questions

The Commission may issue a notice (Notice) requiring a person to:

  • produce documents or information in relation to a matter that may constitute a contravention of a competition rule; or
  • attend before the Commission to answer questions in relation to an investigation.

Failure to comply with a Notice is an offence, punishable by imprisonment for up to one year and a fine of up to HK$200,000.

Limits on Commission’s powers

The Commission may only require a person to produce a document or answer a question that:

  • relates to a matter that the Commission reasonably believes is relevant to an investigation; and
  • is not subject to legal professional privilege.

You may consider raising an objection if the Commission requests irrelevant or privileged information.

Protection of confidential information

A Notice may require a person to produce information that relates to a company’s confidential commercial activities.  The information must be provided to the Commission if it falls within the scope of the Notice.

The Commission must maintain confidentiality in relation to the confidential information, but may disclose it to third parties in some circumstances.  For example, the Commission may disclose confidential information:

  • in the performance of its functions under the Ordinance (subject to consideration of the potential harm that may be caused by the disclosure); or
  • in accordance with an order of the Competition Tribunal or in connection with Tribunal proceedings.

No right to silence

If a person receives a Notice to attend for questioning, the person must answer a question even it might expose the person to proceedings for pecuniary or financial penalties. However, the person’s answer is not admissible in any subsequent proceedings.

Obligation not to disclose confidential information

Confidential information received from Commission must not be disclosed to third parties

A person who has received “confidential information” from the Commission must not disclose that information to any other person. Unlawful disclosure of confidential information is an offence, punishable by imprisonment for up to two years and a fine of up to HK$1 million.

Confidential information may, however, be disclosed in certain circumstances, such as for obtaining legal advice in connection with legal proceedings, or in accordance with a law.

Confidential information” has a specific meaning under the Ordinance. It is information that:

1.has been provided to or obtained by the Commission in the course of, or in connection with, the performance of its functions under the Ordinance that relates to:

  • the private affairs of a natural person;
  • the commercial activities of any person that are of a confidential nature; or
  • the identity of any person who has given information to the Commission;

2.has been given to the Commission on terms that or in circumstances that require it to be held in confidence; or

3.has been given to the Commission and has been identified as confidential information in accordance with the Ordinance.

Can a company disclose the fact that it is being investigated?

It appears that the disclosure restriction relates only to “confidential information”, which has the specific meaning referred to above. In some cases, the fact that a company is being investigated may not fall within the meaning of “confidential information”. However, out of an abundance of caution, a company under investigation (and employees and officers of the company) should still be careful not to disclose the fact that it is under investigation.

Hong Kong Competition Law Guide

For more information on Hong Kong’s competition rules, see our Hong Kong Competition Law Guide.

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