Reed Smith Client Alerts

Dawn raids, when enforcement officers arrive unannounced at a business’s premises to seize devices and documents, examine records, and question personnel, typically signal a significant escalation of the authorities’ investigative process. Such raids can severely disrupt business operations, and have an adverse impact on employee morale and the company’s reputation. How businesses react during the initial stages of a raid can be critical not only to minimizing such disruption, but to their ability to negotiate or navigate the outcome of a regulatory probe.

Authors: Calvin Chan

Asia-Pacific trends

There has been a general shift toward stronger search and seizure powers by regulatory authorities in the region. In April 2020, Australia amended its financial services laws to allow its Securities and Investment Commission to seize a broader category of materials than was previously permitted under its search warrant powers.1 A March 2020 Hong Kong High Court ruling cleared the way for the city’s Securities and Futures Commission to seize electronic devices from suspects and obtain passwords for these devices when carrying out an investigation.2 Singapore has also strengthened the enforcement powers of its specialist regulators, such as the Personal Data Protection Commission, the Monetary Authority of Singapore, and the Competition and Consumer Commission of Singapore. The officers from these government agencies are empowered to enter premises without a warrant and obtain materials that are relevant to their investigations.

There is also growing cooperation and coordination among regulators and enforcement agencies. For example, the Indonesian Competition Commission shares information and undertakes joint enforcement operations with the Indonesian police, which has more extensive powers to conduct investigatory searches and seizures. Investigations initiated by enforcement agencies or regulators outside the region have also resulted in high-profile raids on the offices of implicated multinationals in the region, including China, Singapore, and Malaysia.

Dawn raids can be triggered by a wide range of alleged regulatory misconduct that goes beyond what may be traditionally deemed as “serious offenses” such as corruption or fraud, money-laundering, and the theft of state secrets or espionage, to include other areas such as antitrust and data privacy.