Court Order Highlights the European Commission’s Extensive “Dawn Raid” Powers

An order of the European Court refusing to grant interim relief to Nuctech, a Chinese maker of security scanners, has highlighted the European Commission’s (the Commission) extensive powers to access company information following unannounced inspections, or “dawn raids”.

The order confirmed that:

• The Commission can inspect the EU premises of a company that is incorporated in another jurisdiction, such as China
• The Commission must be allowed to access information from such companies even if it is held on servers outside the EU
• Although, in principle, a company can argue that complying with a data request would infringe foreign laws and expose it to criminal sanctions, the burden of proving this has been set very high and it is unlikely to be argued successfully
• Companies are also unlikely to get interim relief by arguing that an ongoing investigation exposes them to either reputational harm or financial damage