Originally published in Blakes Bulletin on Competition, June 2007
On April 16, 2007, the Competition Bureau issued a request for public comments by July 12, 2007, on a draft publication relating to the Commissioner of Competition’s powers of search and seizure titled: “Draft Information Bulletin: Sections 15 and 16 of the Competition Act”.
The Draft Information Bulletin gives an overview of the scope of sections 15 and 16 of the Competition Act (the Act), when the Commissioner seeks search warrants, and the procedures by which those warrants are obtained and executed. Some of the key topics covered in the Information Bulletin, including some of the key issues that you and your company should keep in mind if faced with a warrant, are summarized below.
The Commissioner may obtain a search warrant under section 15 of the Act in connection with either a civil or criminal investigation. The Commissioner is not required to commence an inquiry under section 10 of the Act before bringing an application for a search warrant. (Whereas she must commence a section 10 inquiry before she can obtain an order compelling a person to be examined under oath, produce specified records or make a written return of information under section 11 of the Act).
The test set out in section 15 of the Act for issuance of a search warrant is that the judge be satisfied that there are reasonable grounds to believe that: (i) a person has contravened an order made under the Act; (ii) grounds exist for the making of an order under Part VII.1 (deceptive marketing practices) or Part VIII (reviewable practices) of the Act; or (iii) an offence under the Act has been or is about to be committed. The judge must also have reasonable grounds to believe that there is, on the premises to be searched, any record or other thing that will afford evidence with respect to the matter under investigation.
Where a warrant has been obtained under section 15 of the Act to search for one or more records, section 16 authorizes a search of data either stored on or accessible from any computer system on the premises for the records described in the search warrant. Section 16 further authorizes seizure of a printout or other copy of the data found. The definition of “computer system” is broad and may include Blackberries and cell phones.
A search warrant is obtained ex parte (without notice to the person who is under investigation or the person whose premises are to be searched), to guard against destruction of evidence. The Draft Information Bulletin states, “searches are one of the Bureau’s most effective investigative tools to combat cartels and mass marketing fraud as the element of surprise provided by the execution of a search warrant is deemed essential to obtaining the required information.”
When the search warrant is executed, the search team will first secure the premises, including, for example, sealing shredders and restricting access to computer systems. However, the Draft Bulletin notes: “Once the premises are adequately secured, the team leader may accommodate a request to delay a search for a reasonable period of time until the arrival of a senior corporate official and/or counsel.”
Any claim for solicitor-client privilege over records should be made promptly, as the search team is then required by section 19 of the Act to seal those records without examining or copying them, and a judge will later determine if the privilege claim is valid. If the privilege claim relates to records on a computer system, which may be difficult to segregate during the search, it may be necessary for the Bureau to preserve and seize a copy, to be reviewed later under a process agreed to by the parties.
During the search, the Bureau may seek to question individuals to obtain evidence from them. The Bureau has no power to arrest or detain such individuals; however, if they provide information, it may be used as evidence.
The Draft Information Bulletin is available on the Bureau’s Web site at: http://www.competitionbureau.gc.ca/internet/index.cfm?itemID=2298&lg=e. The request for comments can be found at: http://www.competitionbureau.gc.ca/internet/index.cfm?itemID=2298&lg=e.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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