General Court bolsters up the European Commission: Dismissal of action brought by German fragrance company for annulment of inspection decision authorising a dawn raid to be conducted on the undertaking.

In March 2023, in coordination with the US Department of Justice, the Swiss Competition Commission and the UK Competition and Market Authority, in various Member States, the Commission raided Symrise and several other undertakings active in the fragrances industry, because of alleged anticompetitive conduct infringing Article 101(1) TFEU (see here). The Commission suspected that the undertakings had engaged in coordinating commercial strategies, exchanging competitively sensitive information and in coordinating standards together with the International Fragrance Association (IFRA).

Following the dawn raid, Symrise challenged the legality of the related inspection decision before the General Court seeking its annulment. The undertaking argued that the inspection decision

• was an arbitrary “fishing-expedition”, because of a lack of sufficient grounds for suspecting Symrise’s involvement in any competition law infringement, violating the fundamental right of inviolability of private premises as guaranteed in the European Charter of Fundamental Rights;
• was disproportionate, as it did contain no limitation in time, infringing the fundamental right of inviolability of private premises;
• failed to specify clearly and precisely the subject matter of the inspection, as prescribed in Article 296(2) TFEU, making it impossible for Symrise to understand the scope of the inspection and inhibiting the undertaking’s right to defence.

The General Court rejects all pleas brought forward by Symrise:

• The General Court states that the Commission did not conduct a “fishing-expedition”, because the Commission had sufficient grounds for suspecting a violation of competition law by Symrise. In this regard it is particularly noteworthy that the General Court confirms that the indicia justifying a dawn raid can derive from prior ex officio investigations conducted by the Commission (in contrast to information provided e.g. as part of a leniency application by an undertaking). In the case at hand, the Commission possessed certain information from various requests of information and an open source intelligence report, hinting towards competition law infringements.
• Furthermore, the General Court dismisses the claimant’s argument that the inspection decision was disproportionate, because it lacked a limitation in time. The General Court argues that it is sufficient for the claimant to receive confirmation of the end of the inspection, once the Commission has finished reviewing the data in the Commission’s premises in Brussels.
• Additionally, the General Court holds that the inspection decision was sufficiently clear and precise, because it enabled the company to understand the reasons which led to the Commission’s suspicion of competition law infringements. According to the General Court, the inspection decision also described the investigators’ powers in a sufficiently precise manner.

As already noted, the judgement is exemplary for several recent cases in which companies raided by the Commission challenged the legality of inspection decisions before European Courts.

A look into the past reveals a mixed picture regarding the outcome of such legal actions: In some cases, raided undertakings successfully challenged the respective inspection decisions. For example, in 2015, the ECJ partially annulled inspection decisions issued in relation to Deutsche Bahn (C-583/13 P), because of an infringement of the undertaking’s right to defence (see here). In other cases, the Commission succeeded, as the courts fully dismissed the respective companies´ legal action for annulment. An example would be the ECJ’s dismissal of an appeal brought by Alcogroup and Alcodis in 2019 (see here). However, considering the ECJ’s recent annulment of the inspection decision regarding Intermarché, Casino and Intermarché Casino Achats in 2023, because the decision was not sufficiently grounded (the Commission had failed to record interviews with third parties conducted in preparation of the inspection decisions), it was of some significance for the Commission to succeed against Symrise. An annulment of the inspection decision would have given rise to doubts about how robust and sustainable the Commission’s general approach to dawn raids remains in light of an increasing trend for raided undertakings to bring actions for annulment of inspection decisions.

The higher frequency of legal actions may be a coincidence, but it may also be related to the observation that several competition authorities are frequently testing the legal limits of dawn raids (see Luther Antitrust & Competition Law Forecast 2025 under I.) “provoking” undertakings to challenge the legality of inspection decisions. At least for the Commission there is not much of a hurdle (at least by external control) for this kind of “test-ballooning”, because the Commission has the competence to issue inspection decisions independently without the prior authorisation by a court (unless the inspection concerns private premises, cf. Article 21(3) Directive No 1/2003).

For undertakings, this “test-ballooning” is quite worrisome, because, regardless of whether an undertaking was actually involved in an actual infringement of competition law, the mere fact that it was subject to a dawn raid implies severe reputational losses, leads to considerable costs for legal defense, and usually triggers potential victims that had allegedly overpaid prices to bring antitrust damage claims against the raided undertaking (particularly in the U.S.).

However, the authorities’ increasingly wide approach in conducting dawn raids stresses the unaltered paramount importance of such investigations for the Commission and national competition authorities to detect and sanction anticompetitive behaviour. Further evidence of this great significance is that competition authorities react with zero tolerance in case of any obstructions of dawn raids. Recently, the Commission has repeatedly highlighted that they take any obstructions of dawn raids very seriously. The Commission also emphasised that obstructions will be pursued and sanctioned. A vivid example in this regard was the fine amounting to EUR 15.9 million, which was imposed by the Commission on International Flavors & Fragrances (see here) in 2024 following the deletion of WhatsApp messages by an employee during a dawn raid (see Luther Antitrust & Competition Law Forecast 2025 under I.). Notably, this dawn raid was directly related to the antitrust allegations raised against Symrise. A recent example at the national level illustrating the increased risk for companies to be sanctioned for obstructing a dawn raid is the fine imposed by the Finnish Competition and Consumer Authority (“FCCA”) on the care company Attendo Sumi Oy, because an employee deleted work-related WhatsApp messages and the call log from their phone during a dawn raid. Initially, the FCCA imposed a fine of EUR 4.4 million on the company, which was later reduced to EUR 1.5 million by the responsible Finnish Market Court. With regard to the reduction the Market Court strongly took into account the undertaking’s cooperation efforts following the deletion of WhatsApp messages. The fine was the first ever fine imposed by the FCCA for the obstruction of a dawn raid (see here).

The General Court’s judgement – if upheld by the ECJ – certainly fosters the Commission’s position regarding issuing an inspection decision, as it stresses the Commission’s wide discretion to collect indicia justifying an inspection. However, it will be of great interest to see to what extent the European courts will strengthen the Commission’s position in other scenarios in the near future. This largely depends on the outcomes of further cases currently pending before European courts. In the Michelin case (see here) the General Court will have to decide on whether to annul an inspection decision issued by the Commission, because of an infringement of fundamental rights due to an alleged inadequate statement of reasons in the decision. Additionally, Red Bull has recently submitted an action before the General Court (see here) in response to the Commission’s cost decision imposing on Red Bull the costs for the transfer to Brussels of the data seized during a dawn raid targeting the undertaking, where the data inspection was continued.

In any case, for undertakings this development signifies a blessing and a curse at the same time. On the one hand, successes such as those achieved by Intermarché, Casino and Intermarché Casino Achats imply that undertakings have a real chance of countering actions by the Commission in relation to a dawn raid. On the other hand, Symrise’s defeat implies that there is no reason to presume that the Commission will apply stricter standards for issuing inspection decisions.

That said, possible dawn raids will continue to be a “sword of Damocles” for companies, even without wrongdoing as they can quickly fall under the (not seldom unfounded) suspicion of engaging in anti-competitive behaviour triggering the right of the Commission and national competition authorities to conduct a dawn raid (and the success of a legal challenge of the investigation being often uncertain).

Yet, companies should still take the greatest care to avoid even minor antitrust law infringements in order not to give the Commission or national authorities a reason to conduct inspections. Robust compliance management systems can play a great role in minimizing the risks of inspections and their significant impact on the companies under investigation.