Businesses Struggle with Compliance as Regulatory Investigations Increase

More than two-thirds of organisations (68%) have to deal with regulatory investigations either frequently (36%) or occasionally (32%), according to our latest survey.

The findings come in the wake of a recent wave of unannounced regulatory searches, known as dawn raids, carried out by regulators including the Competition and Consumer Protection Commission (CCPC), and the Commission for Communications Regulation (ComReg).

The survey of 200 industry professionals was carried out at our annual Regulatory Investigations & Prosecutions Update. The event offered practical advice to companies in dealing with regulatory investigations and provided actionable steps for attendees.

Shane Reynolds, Health & Prosecutions Partner, commented: “Our findings highlight the increasing regulatory scrutiny that businesses are facing. This increase in regulatory activity is expected to continue in view of the CCPC’s and ComReg’s newly acquired powers to impose significant administrative fines.

Our advice to companies is to be proactive in keeping pace with the current regulatory environment. Understanding the latest court rulings and how they impact your industry can help you stay one step ahead of potential issues.”

This heightened scrutiny has posed new challenges for businesses. For more than half of respondents (52%), ensuring compliance with legal procedures is the top concern when dealing with dawn raids or other regulatory searches.

Fiona McNulty, Health & Prosecutions Partner, said: "Legal compliance during searches is not just a procedural necessity; it's a safeguard against potential legal liabilities and penalties. For instance, during a dawn raid, having a well-rehearsed protocol in place can prevent the accidental disclosure of privileged information. This could otherwise result in significant fines or legal challenges.

It is crucial for companies to regularly review their compliance procedures, conduct internal audits, and ensure their staff are trained to handle regulatory searches and enquiries effectively.”

The survey revealed that almost two-thirds of respondents are not confident in disputing seizures of privileged material, underscoring potential vulnerabilities. Privileged material refers to confidential communications between a lawyer and their client, which are protected from disclosure in legal proceedings.

Labelling privileged documents and having a legal team ready to challenge improper seizures can make a significant difference.

Shane Reynolds further commented: “Without the confidence to effectively challenge these seizures, organisations risk exposing sensitive information that could be detrimental in legal proceedings. This lack of confidence often stems from insufficient legal knowledge and preparedness, highlighting the need for specialised training and robust legal support.

We also advise clients to engage early with regulators to manage document reviews and ensure confidentiality. Labelling privileged documents and having a legal team ready to challenge improper seizures can make a significant difference. Without such precautions, companies risk exposing sensitive information that could be detrimental in legal battles."

Read more about our survey findings on Irish Legal News or the Law Society of Ireland Gazette.