Property Rights Foundation of America®
Founded 1994

March 2002:

Where is the Fundamental Right to Privacy going in the European Union?

EUROPEAN UNION INSTITUTES DAWN RAIDS

"Powerless" EU's Warrantless Searches Can Lead to Heavy Fines

The anti-trust agents of the European Union are raiding corporate offices at a rate of about once a month, according to The Wall Street Journal.(1) Early one morning in 1999, when the EU agents raided Coca-Cola's London offices without a warrant, they dug into computers and e-mail servers, examining hundreds of messages for evidence of favoritism toward particular retailers. Coke was powerless to stop them as they searched and left with copies of confidential messages and legal documents prepared by the company's in-house lawyers.

Such gathering of memos and e-mails between a firm and its attorney would be prohibited in the U.S., the United Kingdom, Germany, Belgium, and many other countries. Communications with legal counsel can't be used as evidence because they are considered confidential, to protect the right to legal representation.

Even though there is no judicial review of the dawn raids, the EU can use the evidence gathered to impose anti-trust fines of up to ten percent of a company's world-wide revenue.

Ironically, the EU has no power to issue subpoenas, and has no jails or criminal law. According to the Journal, a former EU antitrust investigator, Julian Joshua, said, "What we really needed was to get the documents, and to do that we needed to catch them by surprise."

The warrantless searches have gone unnoticed by the public, unless the targeted companies announced that they were hit.

"Jonathan Evans, a British member of the European Parliament, says that the European Commission, the EU's executive branch, 'appears to be investigator, prosecutor, judge and jury,'" according to an article written by Philip Shishkin appearing in the Journal on March 1, 2002.

The Journal stated that the only approval needed for the searches is from the EU's powerful antitrust chief, Mario Monti, "who usually bases his decision on whether the haul of evidence will likely be big enough to justify the time and expense." However, this European Union practice contravenes historic legal traditions.

Protection from warrantless searches is a fundamental right in American law.(2) The tradition of requiring judicial search warrants is ancient, even predating the U.S. Constitution and Bill of Rights. Blackstone's Commentaries of the Laws of England written during 1765 to '69 was the basic legal reference summarizing the common law of England which became the foundation of American common law. Blackstone and the references he cites from even earlier traditions require that warrants be issued by justices before searches are conducted. In fact, charges had to be made before search warrants could be issued.(3)

The European Company Lawyers Association attacked the practice of gathering of memos from in-house lawyers through warrantless searches for its "human rights implications," according to the Journal. The American Chamber of Commerce in Belgium urged the commission to meet American search warrant standards.

Additional Powers Sought

Arguing that employees can hide documents in their homes, Mr. Monti now wants to expand the raids to executives' personal belongings in their homes, according to the Journal. He wants the power to interrogate employees about antitrust practices without advising them that they have a right to an attorney. An EU official stated that the European case law only requires that investigators not object if an attorney is present, but that they are not required to advise of the right to representation.

The right to privacy, private property rights, and the right to legal counsel are inextricably connected. The power struggle between the European Union and the member nations reported in the Journal article has implications for the future of private property rights that should be watched closely.
- Carol W. LaGrasse

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Notes:

1 Shishkin, Philip, "European Regulators Spark Controversy With 'Dawn Raids,'" The Wall Street Journal, March 1, 2002, page A-1.

2 Bill of Rights, United States Constitution:

Amendment IV: "The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized."

Amendment V: "No person shall be...deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use without just compensation."

Amendment VI: "In all criminal prosecutions, the accused shall enjoy the right to a speedy and public trial...and to have the assistance of counsel for his defence."

3 Blackstone, Sir William, Commentaries on the Laws of England in Four Books, p. 102, "Powers of Justices of Peace" (Ed., For the use of American Students, George Chase, LL.B., Third Edition, Banks & Company, Albany, N.Y. 1900).

See also Privacy - National on PRFA web site: prfamerica.org

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