CMA Wins Legal Challenge on Cartel Home Searches

THE COMPETITION and Markets Authority (CMA) has won an important legal challenge in the High Court today after a tribunal refused to grant it a domestic search warrant as part of a cartel investigation.

The High Court found in favour on all three grounds of appeal after the CMA sought judicial review of decisions made by the Competition Appeal Tribunal (CAT) on search warrants.

Cartel Home Searches 

In October 2023, the CMA applied for warrants to search business and domestic premises as part of its investigation into a suspected construction chemical admixtures cartel. The CMA conducted raids to gather evidence as part of its investigation.

While the CAT granted warrants authorising the CMA to search three business premises in England and Scotland, it refused the warrant regarding a domestic property.

The CAT said it was necessary for the CMA to identify specific evidence showing that an occupier had a “propensity” to destroy physical or electronic documents held on their property. It said their suspected involvement in a secret cartel was not enough.

The CMA was concerned that the CAT’s decision would damage its ability to gather evidence to effectively investigate secret cartels, particularly as the decision was a guideline case to be followed in the future. It led to the CMA applying to the High Court for judicial review in December 2023.

CMA Wins Legal Challenge

The High Court agreed with the CMA that the CAT had made an error. It said CAT was incorrect to state that specific evidence of a “propensity” to destroy electronic or physical documents was always required for a domestic search warrant. It added that the CAT judgment should not be followed in future cases.

Sarah Cardell, Chief Executive of the CMA, said: “We welcome this important ruling from the High Court, which found comprehensively in our favour on all three grounds.

“The original judgment by the Competition Appeal Tribunal risked seriously undermining our ability to enforce effectively against illegal cartels.

“With the increase in remote-working – and electronic communication – it’s essential that we are able to search domestic premises to secure evidence.”

The investigation is into the supply of chemical admixtures and additives which are ingredients in concrete, mortars and cement used in the construction industry. The CMA is working with its counterparts in Europe and the USA.

Anyone who has information about a cartel is encouraged to call the CMA cartels hotline on 020 3738 6888 or email cartelshotline@cma.gov.uk.

>> Read more about construction cartels in the news