The way people communicate is constantly under transformation following technological advances. Business communication is not away from this trend as cutting edge-technologies provide instant communication tools that brings efficiency and convenience in daily communication of employees. Not surprisingly, legal authorities in general and antitrust authorities in particular, are also keeping tabs on this transformation in order to preserve the efficiency of their investigative practices and evidence search during handling their cases.
Recently, the Dutch antitrust watchdog, The Netherlands Authority for Consumers and Markets ("ACM") imposed a noteworthy fine of 1.84 million euros to a company under antitrust investigation, for obstructing a dawn raid by deleting Whatsapp conversations. Indeed this remarkable case is not the first one where Whatsapp messages are taken into consideration in antitrust cases. Before getting into details of the recent Dutch case, let's go over a number of relevant previous cases from different national authorities and afterwards a few ones from Turkey:
- The Spanish Competition Authority (the Spanish Markets and Competition Commission / "CNMC") acknowledged Whatsapp correspondence as evidence for the violation market partitioning in the 2013 Almendra y Miel case1. The Spanish Supreme Court (Audiencia Nacional) also approved the decision.2
- The Spanish Competition Authority took into consideration the Whatsapp conversations in the 2016 Cementos case3.
- The Chinese Competition Authority (China's National Development and Reform Commission /"NDRC") based its violation claims on Wechat4 conversations, at the vehicle inspection cartel case.
- In the 2017 wristband cartel case5 against Zaappaaz, Promotions, Wrist-Band, Customlanyard, the Antitrust Division of US Department of Justice based its violation claims on the conversations found on social media platforms and encrypted messaging applications, such as Facebook, Skype and Whatsapp and determined that the companies reached and implemented their illegal agreements through these communication channels.
All these four cases show that Whatsapp findings have been legally considered as evidence very similar to traditional email findings. In the Spanish case in particular, the Supreme Court approval has reinforced this situation.
Regarding the practice in Turkey, so far, there is no case ended up with violation decision based on evidence coming out of Whatsapp conversations. But the Turkish Competition Authority ("TCA") has been taken Whatsapp correspondance into account officially in reasoned decisions of several cases since 2017 as follows:
- The first case in which TCA was confronted with Whatsapp communication is the Orthodontics decision6, where TCA conducted a cartel investigation against suppliers of orthodontics materials and equipments for price-fixing. The Authority did not find any violation of antitrust rules, but officially referred to Whatsapp conversations in the reasoned decision. As per the decision, the Whatsapp accounts in question was belonging to corporate lines, not private line of the individuals and the inspectors reached out these communications via web-based application.
- In the Frito Lay decision7, where TCA conducted a preliminary investigation for abuse of market dominance claims, the Authority took into consideration the Whatsapp conversations provided by the complainant. The Authority did not find any violation but the presence of Whatsapp content in the reasoned decision indicated the Authority legally valued this contend as evidence.
- In the MOSAS decision8, the Whatsapp dialogues of employees about the undergoing downraid with the content such as; disconnecting the internet, disrupting the modem, deleting the emails, was accepted as evidence of hindering or complicating the down raid. Thereupon, screenshots of the correspondences was taken by the inspectors.
- In the Cig Kofte decision9, TCA took into account the document provided by the complainant, which disclosed the existence of a Whatsapp group through which competitors get into contact and exchange information regarding the market.
- Another decision where TCA valued Whatsapp content, is the Mey-Efes merger decision10, which is an interesting hostile takeover attempt occurred between two giant producers of alcoholic beverages in Turkey. "Tekel Birası" is the brand under the possession of Mey and was being subject to be taken over by Efes. As understood from the decision, Mey did not show consent for this acquisition and declared that Efes submitted a merger file based on misleading information regarding their consent. On the other hand, Efes tried to demonstrate Mey's consent by handing over Whatsapp conversations between the executives of two companies. In the end, TCA found that the merger is not subject to notification but acknowledged Whatsapp correspondence as evidence demonstrating Mey's consent and accordingly did not fined Efes for misleading information.
The Recent Dutch Case
ACM, the Dutch antitrust watchdog has recently released a remarkable decision that shows the decisiveness of the Authority to preserve its investigative powers in phase new communication tools. The Authority imposed a fine of 1.84 million euros to company under investigation for deleting Whatsapp conversations during a dawn raid.
As per the legislation; the ACM is authorized to perform unannounced dawn raids during investigations. All companies under investigation are required to cooperate with ACM investigations and should not destroy or damage any evidence. ACM inspectors inform company executives about the dawn raid procedure at the outset and explain clearly that the employees must cooperate with the inspection team.
In this particular case;
- The inspectors explained the dawn raid procedure and requested to inspect all physical and electronic documents including corporate phones and got started,
- During the dawn raid, one of the two employees of the company who was requested to hand over the corporate phone, left several Whatsapp groups before handing it over to the ACM inspector. Afterwards ACM inspector informed the company manager to cooperate with the ACM investigations and not to destroy mobile content. Despite this warning some more employees left the internal Whatsapp groups during the dawn raid and also deleted conversations that could contain evidence related to the alleged violations,
- After this last act of the employees, the company instructed the employees not to touch the app messages, delete conversations or leave the Whatsapp groups.
Although the company indicated that it could retrieve the lost data/material by other means and hand it over to the ACM, these actions have been considered as a breach of the duty of cooperation according to article 5:20, first paragraph of the Dutch General Administrative Law Act. The ACM considered the commited actions of employees of the company as if they were 'in line with the normal business operations of the legal entity, the employees thought they were useful to the legal entity and the legal entity was able to decide whether or not the conduct would take place and, according to the actual course of events, the legal entity accepted this behavior'. The Authority, when determining the basic fine, considered; the seriousness, the culpability, the circumstances and the duration of the violation and as a result the company was fined for 2.3 million euros.
The ACM has also decided to reduce the basic fine by 20% to 1.84 million euros, since there was a special form of cooperation in the procedure during the investigation phase. Accordingly, the ACM has considered the following facts when applying the fine reduction:
- The manager and the company have cooperated with the ACM during the company visit and afterwards.
- They have informed the ACM inspectors that certain Whatsapp groups and chats were deleted or abandoned by employees.
- They also provided an overview with the names of deleted or abandoned Whatsapp groups and chats, the subject of chats, the participants in these chats and the mobile phones on which these chats could still be retrieved.
- The company acknowledged that the actions of the employees are illegal and the employees wrongfully left and deleted Whatsapp material.
- The company accepted the legal assessment as set out in the decision, the method of the fine and the amount of the fine to be imposed.
In view of the series of antitrust cases described above, and in particular the latest Dutch case, it can be conluded that the antitrust authorities take decisive action to preserve their investigative powers in the phase of new communication tools.
1. Almendra y Miel y Otro, expte. R/DC/0001/14, Date: 31.01.2014
2. Decision of Audiencia Nacional dated 18 July 2016, D. Claudio, Almendra y Miel SA y Confectionary Holding SL v CNMC, No 136/2014, ES:AN:2016:2986.
3. Cementos, expte. S/DC/0525/14, Date: 05.09.2016
4. The popular Chinese messaging application.
5. USA v. Azim Makanojiya, Case No: 4:17-cr-00478, Date: 07.08.2017
6. TCA Decision: 29.03.2018, 18-09/157-77
7. TCA Decision: 12.06.2018, 18-19/329-163
8. TCA Decision: 21.06.2018 18-20/356-176
9. TCA Decision: 10.01.2019, 19-03/13-5
10. TCA Decision: 07.02.2019, 19-06/54-20
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