The European Commission announced on 30 September that it has carried out unannounced inspections (otherwise known as ‘dawn raids’) at the premises of a company active in the vaccines sector.
The dawn raids constitute a preliminary step in the Commission’s investigation into whether the inspected company has undertaken practices which may amount to anticompetitive disparagement.
Disparagement refers to the situation where a company makes false, misleading or unjustifiable negative statements about a competitor’s products, services or business. This conduct can have anticompetitive exclusionary effects on the competitor by (for example) influencing potential customers’ purchasing decisions away from the competitor and towards the disparaging entity. In certain circumstances, the disparaging entity may also undertake such exclusionary conduct to preserve its status as the sole or leading supplier of a product, therefore preventing downward pressure on the price of its product from new market entrants.
This investigation is the third disparagement case pursued by the Commission in recent years (following the Vifor and Teva cases). In the cases to date, the conduct of the investigated company has been undertaken as part of a communication strategy of disseminating information to customers which casts doubt on the quality, safety or efficacy of the competitor’s product.
A finding of anticompetitive disparagement can carry significant penalties for the infringing company.
Are you dawn raid ready?
Mills & Reeve’s competition team has a wealth of experience advising on investigations by the UK Competition and Markets Authority and other competition regulators. We can advise on all aspects of competition investigations, including attending and advising on all aspects of unannounced inspections across the UK, as well as assisting with dawn raids readiness through advising on dawn raids policies and procedures, running practical dawn raids training for all levels of the business, and running mock dawn raids.
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