Legal professional privilege

Waiver of legal professional privilege

Recent cases have highlighted that parties and practitioners must take care to avoid the unintentional waiver of legal professional privilege. For example, in ASIC v Park Trent Properties Group Pty Ltd [2015] NSWSC 342, the Supreme Court of New South Wales held that the defendant had waived privilege over legal advice provided in the preparation of a compliance manual by voluntarily disclosing the manual to the Australian Securities and Investments Commission (ASIC). Key to the court’s finding was that:

• The legal advice shaped the substance of the manual, and
• The manual was deployed to obtain an advantage

This decision reaffirms that privilege can be waived by disclosing the effect of the legal advice, regardless of whether the advice itself is disclosed. Accordingly, it reminds parties to think twice before voluntarily disclosing compliance material that has been prepared by lawyers.

The Western Australian Supreme Court recently found that the privilege in lawyer-client emails may be waived if a third party is copied. In TEC Hedland Pty Ltd v. The Pilbara Infrastructure Pty Ltd [2018] WASC 300, the central issue was whether the maintenance of the privilege is inconsistent with the use of the relevant communication. TEC had agreed to supply electricity to Pilbara. B&V, the party copied into the emails between TEC and its lawyers, had been engaged to perform a test procedure. The test procedure was one of the issues in dispute. The court referred to the Full Federal Court decision of Bennett v Chief Executive Officer of the Australian Customs Service [2004] FCAFC 237 and endorsed the principle that:

'for a client to deploy the substance or effect of legal advice for forensic or commercial purposes is inconsistent with the maintenance of the confidentiality that attracts legal professional privilege'.

The court concluded that TEC had waived privilege over the emails with its lawyers by copying B&V. This case confirms the importance of ensuring only essential parties, and not third parties, are copied into privileged communications.

Illegality

The principle that legal professional privilege does not apply to communications made for improper and / or illegal purposes is well settled. The Federal Court has applied this principle in circumstances where the lawyers involved were not necessarily aware of the illegality. In Aucare Dairy Pty Ltd v Huang [2017] FCA 746, there was evidence to indicate that the defendant, Huang, had moved and / or placed ownership of assets of an insolvent company beyond the reach of Aucare, with whom the insolvent company had previously been in a failed joint venture with. The court found that Huang's lawyers knew and / or participated in the alleged fraud, despite the plaintiff not having suggested this and there being no direct evidence that this was the case. The court ordered production of privileged correspondence between Huang and her lawyers. This case emphasises that there is a risk that where there is evidence of illegality and / or improper purpose by a party, that party will not be entitled to legal professional privilege.

Directors

In Equititrust Ltd (in Liq) (Receivers appointed) (Receivers and Managers Appointed) v Equititrust Ltd (in Liq) (Receiver appointed) (Receivers and Managers Appointed) (No.3) [2016] FCA 738, the Federal Court held that a director may only claim privilege over documents containing legal advice if it relates in some way to the director in their personal capacity, and not merely to the operations of the company. A former director of Equititrust claimed privilege (both joint and common interest) over a range of documents produced by Equititrust that contained legal advice. The court held that only 11 of the 625 disputed documents were privileged. In relation to joint privilege, the court found that there was scarce evidence that the director had personal concerns in the matters raised by the documents disputed and clarified that: legal advice addressed to a director or 'the Directors' did not necessarily mean that the advice was provided on the basis of joint privilege; and the fact that a director was involved in procuring the legal advice did not on its own establish joint privilege. In relation to common interest privilege, the court highlighted that commonality of interest is a prerequisite for the privilege to apply – the mere fact that legal advice was communicated to Equititrust does not mean that its directors had a common interest privilege in that advice; and the fact that a company can only act though its directors does not give rise to a common interest. This case reminds directors of the need to clearly identify legal advice obtained in their personal capacity in order for it to be subject to privilege.

Trustees

In Hancock v Rinehart (Privilege) [2016] NSWSC 12, Gina Rinehart claimed privilege over documents produced by her former lawyer pursuant to a subpoena issued by her daughter, Bianca, as the new trustee of the Hope Margaret Hancock Trust (Gina was the former trustee). The Supreme Court of New South Wales found that there was no evidence to support Gina's claim of privilege. Gina had not adduced any evidence about the circumstances and purposes of the disputed documents, including whether the documents had been created for Gina in her capacity as trustee. The court noted that if the costs of obtaining legal advice are paid from the trust fund, the suggestion is that advice was obtained on behalf of the trust and not the trustee personally. This case reiterates the position that legal advice obtained by a trustee belongs to the trust and not the trustee personally.

Even though the issue of (the lack of) legal professional privilege in Austrian antitrust and competition law has been a matter of discussion for many years, the Austrian legislator did not choose to introduce legal professional privilege in Austrian antitrust and competition law with the recent amendments to the Austrian Cartel Act, which entered into force in 2013.

There do not appear to be any recent cases or other legal developments in Bahrain regarding legal professional privilege.

The following three leading cases have recently confirmed the application of legal professional privilege in Belgium:

Brussels Court of Appeal, 5 March 2013

In a matter of competition law, the Brussels Court of Appeal decided that materials prepared by in-house lawyers at the request of their employers benefitted from the protection of professional secrecy and legal professional privilege (see Scope).

Belgian Constitutional Court, 24 September 2013, RW 2014-15, 1340

When an individual provides information to the police (whether or not on an anonymous basis), it is up to the public prosecutor's office to assess what action should be taken and whether it is possible to gather evidence of potential criminal offences that may be revealed by the information received. The fact that the evidence is provided in breach of professional secrecy will not result in any subsequent investigation based on the information being unsound, nor will any evidence subsequently obtained necessarily be held to be inadmissible.

Belgian Constitutional Court, 26 September 2013, case n° 127/2013

The Constitutional Court stated that the purpose of professional secrecy is to protect clients' fundamental right of privacy and trust in their lawyers (acting in their capacity as lawyers) when communicating confidential information. Confidential information is protected by Article 6 of the ECHR as in order to be effective the right of defence requires that a relationship of trust be created between clients and their lawyers. Such a relationship can only be maintained if clients have assurances in law that their lawyers will not disclose confidential information provided to them.

No details for this country.

No details for this country.

Court practice on legal professional privilege in Bulgaria is quite rare OR infrequent. This topic has not been subject to any thorough theoretical research, either. As to the trends in legislation, the latest amendments to the Bar Act were promulgated in State Gazette, no 97 of 7 December 2012. They introduce clearer and more detailed rules on the practising of the profession of a qualified lawyer in Bulgaria of foreign citizens of another EU Member State, of a state party to the EEA Agreement or of Switzerland, and who are qualified for practising a lawyer’s profession in one or more of those countries. In this regard, those changes broaden the scope of legal professional privilege protection covering the activity of the said professionals.

IGGillis Holdings Inc v Canada (National Revenue) 2018 FCA 51

The Federal Court of Appeal affirmed the existence of common interest privilege among parties to a commercial transaction. IGGillis entered into a corporate transaction with Abacus. The lawyer for Abacus prepared a memo outlining the tax implications of the transaction. The Abacus memo was shared with IGGillis. The Canada Revenue Agency ('CRA') required IGGillis to produce the memo. IGGillis and Abacus opposed the production of the memo on the basis of common interest privilege.

The Federal Court of Appeal affirmed that the Abacus memo was protected from production based on common interest privilege. Where legal opinions are shared by parties with mutual interests in commercial transactions, there is a sufficient interest in common to extend the common interest privilege to disclosure of opinions obtained by one of them to the others within the group, even in circumstances where no litigation is in existence or contemplated.

Common interest privilege is not a stand-alone ground for claiming privilege but rather is a defence to a claim that solicitor-client privilege was waived. An application for leave to appeal to the Supreme Court of Canada was dismissed.

Alberta v Suncor Energy, 2017 ABCA 221 - privilege and internal investigations

There was an employee death at one of Suncor’s worksites. Suncor initiated an internal investigation and claimed privilege over all information pertinent to its investigation. The Alberta government challenged Suncor’s blanket claim of privilege. The Alberta Court of Appeal limited Suncor’s blanket claim of privilege and held that the privilege claims over the documents collected during Suncor’s investigation must be considered on a case-by-case or category basis. The Supreme Court of Canada dismissed an application for leave to appeal.

Minister of National Revenue v Duncan Thompson, 2016 SCC 21.

The Canada Revenue Agency (CRA) sought access to a lawyer’s accounts receivable. The lawyer was in arrears of taxes. The lawyer provided the balance owing on the accounts receivable but no further information. The Supreme Court of Canada (SCC) held that the CRA was not allowed to access the lawyer’s accounts receivable because it was not the intention of the legislature for this type of information to be disclosed. The SCC reiterated that privilege belongs to the client and can only be waived by the client. The CRA was trying to gain access to information in the lawyer’s possession without notice to the client, and no opportunity for the client to challenge the release of privileged information.

Alberta (Information and Privacy Commissioner) v. University of Calgary, 2016 SCC 53.

This case involved a wrongful dismissal action against the University by a former employee. During the course of the litigation, the former employee made an access to information request under the province’s Freedom of Information and Protection of Privacy Act. The University refused to release certain information on the basis it was privileged. The Alberta Privacy Commissioner ordered production of the privileged material in order to determine whether privilege was properly asserted. The Supreme Court of Canada (SCC) set aside the Privacy Commissioner’s order for production of privileged material.

The SCC noted that solicitor-client privilege is not merely a privilege of the law of evidence, but a substantive right that is fundamental to the proper functioning of the legal system. The SCC found that the Alberta privacy legislation did not abrogate the substantive right to solicitor-client privilege. To give effect to solicitor-client privilege as a fundamental policy of the law, legislative language purporting to abrogate it, set it aside or infringe it must be interpreted restrictively and must demonstrate a clear and unambiguous legislative intent to do so.

Confidential and privileged information in Chilean competition law

The consolidated text of Decree Law No. 211 ("DL 211") sets out the legal framework for competition regulation which applies in Chile. It contains provisions regarding the treatment of privileged and confidential information in investigations and procedures carried out by the Fiscalía Nacional Económica (National Economic Prosecutor or “FNE”). The scope of legal professional privilege is not defined by DL 211, therefore the general principles applied by the Chilean Bar Association Professional Ethics Code (hereinafter “PEC”) extend to competition investigations and procedures.

To understand the scope of legal professional privilege it is useful to review the extent to which the FNE can request information. According to article 39 letter h) of the DL 211, the FNE has a duty (and corresponding power) to request information necessary for the purposes of undertaking investigations. Pursuant to the same article it is possible to apply to the Tribunal for the Defence of Competition (TDLC) for the denial of a request for information if disclosure could cause harm to the client’s interests and those of third parties. The TDLC must respond to the application as soon as possible, with a verbal or written report of the FNE, and its pronouncement is not subject to appeal.

In the context of a merger control procedure, parties are required to provide sensitive commercial information to the FNE such as: sales, financial statements, main suppliers, customer profiles. If a party under investigation fails to provide the requested information, it may be subject to sanctions set out in article 39, letter h) of DL 211, which include fines or imprisonment. Furthermore, those who are obliged to respond to requests for information made by the FNE and fail to do so, or do so partially, can be sanctioned with a penalty fee of up to two annual tax units for each day of delay[1].

In summary, the FNE has the power to request information from parties when carrying out an investigation, which includes any investigation that is opened during a merger control procedure. Parties are obliged to provide such information and can be sanctioned if they fail to do so, unless they submit a formal application to withhold disclosure on the basis that sharing such information may cause harm to their interests or those of third parties.

Treatment of privileged and confidential information by the FNE

Article 39 of DL 211 provides that the FNE must preserve the confidentiality of certain parts of the investigation file, including: (i) the identity of those that have made declarations or provided background; (ii) formulas, strategies or trade secrets; (iii) any other information whose disclosure may significantly affect the competitive development of the owner; and (iv) where necessary to safeguard the efficiency of the FNE’s investigations. This criterion is applied by the FNE on a case by case basis.

Article 55 of the DL 211 governs the confidentiality of an investigation file that is opened during a merger control procedure. This states that the file becomes public when Phase I ends[2], with the exception of those parts of the file to which article 39 (summarised above) applies. In such cases, the parties can provide public versions (redacted versions) excluding such information.

In summary:

• Confidentiality and/or privilege in respect of information and/or documents are determined by the FNE, pursuant to a request of the interested party or ex officio, on a case by case basis.
• In general terms, the FNE considers whether the information in question has the potential to affect the competitive development of the markets in order to assess whether it is confidential and/or privileged. The FNE has interpreted this criterion extensively throughout investigations, in order to avoid acting as an information facilitator to competitors.
• The obligation to maintain confidentiality extends to prosecutors, employees and any other person who renders services to the FNE.
• The burden of providing public (redacted) versions for the public file lies with the party that is seeking to protect confidentiality. Information can only be redacted if it is confidential and/or privileged.

Legal professional privilege in merger control procedures

Due to the absence of specific legal rules governing legal professional privilege in the context of competition procedures and merger control in Chile, the general provisions of the PEC are applicable to such cases.

In this regard, a lawyer has a duty of confidentiality in respect of all information provided by a client in the context of a professional relationship. This duty commences when any person becomes a client by expressing a serious intention to obtain professional services, and the lawyer expressly or tacitly consents to providing such services. This legal professional privilege extends to potential clients.

Generally, all communications and documents that involve legal advice sent to or from counsel are subject to legal professional privilege. This implies that correspondence between a client and an external lawyer, internal notes reflecting external legal advice and legal advice (even when not related to competition proceedings) are subject to legal professional privilege.

In order for information to be covered by legal professional privilege, the information must be confidential. Confidentiality is assessed both subjectively, meaning that the owner of the information must have an expectation that such information will not become known by anyone other than the person to whom it is being disclosed, and objectively, which implies that the disclosure must be made in circumstances whereby it would not be possible for third parties to have knowledge of it.

A further limitation is that legal professional privilege only covers information relating to the legal matter on which the lawyer has been instructed or that has a connection with the instruction. This excludes other types of assignments that may be entrusted to, or performed by, the lawyer, and which do not engage the professional qualifications of the lawyer: for example, purely economic or administrative matters, in which legal knowledge are not essential.

In practical terms, during merger control procedures, the FNE has allowed parties to disclose relevant information to prosecutors from divisions other than the Mergers Division so that they can determine whether the documents are subject to legal professional privilege. If the parties are not willing to show the non-redacted versions to the impartial team, a procedure through the TDLC must be initiated.

It is also important to note that the FNE may ask parties to complete a confidentiality waiver form which enables it to exchange information with other competition authorities. If this happens, it is important to bear in mind that different legal professional privilege rules could become applicable, with differing outcomes.

In conclusion, lawyers in Chile are subject to a strict duty of confidentiality, which extends to the application of legal professional privilege. Due to the absence of specific legal rules governing legal professional privilege in the context of competition procedures and merger control in Chile, the general provisions of the PEC are applicable to such cases. This is particularly relevant considering that merger control procedures tend to involve requests for detailed and sensitive information, which will always remain confidential from third parties and competitors (where it adversely affects the party’s competitive position) even where it is not subject to legal professional privilege.

Recent cases and/or other legal developments in Chile

On May 8, 2013, case N° 4380-12, the Supreme Court of Chile accepted a Complaint Appeal (a special disciplinary remedy against judges for faults or serious abuse committed in the exercise of their duties) filed by the State Defence Council, “CDE” (an autonomous body that is in charge of defending the interests of the Chilean State), against a decision of the Santiago Court of Appeals, upholding a decision from the “Council for Transparency” (an autonomous body that is in charge of supervising and resolving any complaint for denial of access to public information), which required the CDE to exhibit all documents, reports and communications in its own files which were being used to prepare the defence of the Chilean government in a lawsuit brought against it.

The CDE argued that lawyers cannot be forced to disclose information that they have acquired in the exercise of their profession and that the CDE maintains a relationship with the State that is akin to a lawyer-client relationship, to which the duty of confidentiality attaches.

The Supreme Court accepted this argument and allowed the appeal, declaring that the files were subject to professional secrecy and therefore protected from disclosure.

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[1] To December 2019, 2 UTA annual tax units was equivalent to USD 1,593.

[2] The Chilean merger control procedure consists of two main phases of investigation and eventually a procedure before the TDLC. In Phase I, the FNE has 30 administrative days to issue a resolution approving the operation unconditionally, approving the operation with mitigation measures, or resolving that the operation is potentially harmful for competition. In the latter case, the FNE has to formally start Phase II, which consists of an investigation that lasts 90 administrative days, at the end of which the FNE has to issue a resolution approving the operation unconditionally, approving it with mitigation measures, or prohibiting the operation on the basis that it will harm competition. If the FNE prohibits the operation, the parties can initiate a procedure before the TDLC to obtain approval.

No details for this country.

There were several cases of searches of lawyers and/or their offices in Croatia and seizure of documents some years ago, which the Bar Association considered unlawful. Those cases were brought to the attention of the highest authorities in Croatia; however, the Bar Association has not made public any further information on the legal consequences that have arisen in connection with those searches and seizures.

Those cases were in connection with criminal investigations in which the accused were not the lawyers but their clients. Even though the relevant statutory provisions are unclear in this regard, the Croatian legal doctrine assumed the legal standpoint that searches of lawyers and/or their offices and temporary seizure of documents located in law offices in criminal investigations in which only clients, and not lawyers themselves, are accused should be considered unlawful.

Furthermore, the Croatian legal doctrine considers that all information and documents provided to lawyers by their clients are strictly confidential and, if disclosed, cannot be used in any proceedings against the lawyers’ clients and are to be considered as inadmissible evidence, save in cases regulated by a special law for example, in relation to:

• anti-money laundering or
• tax audits and inspections.

There were also recent cases of searches of lawyers and/or their offices and temporary seizure of documents located in law offices, in cases where the lawyers themselves were accused.

No details for this country.

We are aware of one case heard by the authorities, namely the Billa – Meinl case (decision of the Supreme Administrative Court file no. 5 Afs 95/2007). This case involved legal professional privilege in its purest form, ie communication between an undertaking (subject to investigation by the national competition authority) and its external counsel (registered as a Czech lawyer) relating to a particular competition matter. The national competition authority took possession of documentation during a dawn raid, but immediately returned it and excluded it for the purpose of subsequent fact finding. The Supreme Administrative Court, hearing an administrative action against the decision of the national competition authority, confirmed, in obiter dictum to its judgment, the existence of legal professional privilege in this respect. The Court stated that legal professional privilege forms a part of the undertaking's right to legal protection and that the authority having become acquainted with the content of a document protected by legal professional privilege might violate that right.

Legal professional privilege in the context of merger control

Under Czech law, there is no specific regime in place relating to the application of legal professional privilege in merger control procedures (ie there are no specific guidelines issued by the Czech Antimonopoly Office or any relevant case law on the point).  Instead, the general principles relating to the protection of communications between a lawyer and a client apply (for example as applied in the context of dawn raids as explained above). In the case of multinational mergers, the relevant EU rules apply (see the EU chapter regarding legal professional privilege).

However, according to the Supreme Administration Court, the fact that the administrative body is familiar with the contents of the correspondence between a lawyer and a client and that this correspondence was seized during an on-the-spot inspection is not automatically considered to breach the right to legal protection. While investigating whether the right to legal protection was breached, the particular circumstances of the case had to be balanced, namely:

• under what circumstances the administrative body became familiar with the contents of the confidential correspondence
• which activity or inactivity of the undertaking under investigation took place when marking the documentation as confidential, and
• whether the contents of the correspondence were confidential (ie between a client and a lawyer) and whether the correspondence was marked as confidential

Nevertheless, this is being considered as an error of the proceedings, but it shall require further inquiry to determine whether the error is critical or crucial or significant and whether it had any impact upon the lawfulness of the decision of the Office. The error will be considered as critical or crucial or significant when the familiarisation with the correspondence between a lawyer and a client constituted such a breach of right to legal protection that it fundamentally impacted the investigation and decision making of the Office.

There is no case law on legal professional privilege in Denmark. The latest legal development is the DCCA’s dawn raid guidelines from 2016, in which the authority recognizes the concept of legal professional privilege and establishes a framework for dealing with disputes regarding legal professional privilege. 

There do not appear to be any recent cases or other legal developments in Egypt regarding legal professional privilege.

In February 2017, the Law Society of England and Wales published a new guidance note on Legal Professional Privilege which was developed in consultation with the Law Society's LPP working group and reflects the Law Society's view of good practice in the area.

In Director of the Serious Fraud Office v Eurasian Natural Resources Corp Ltd (see footnote 1), the Court of Appeal overturned a controversial first instance decision relating to the scope of litigation privilege, particularly in the context of criminal investigations. The Court of Appeal held that, on the facts of the case, litigation privilege did apply to certain categories of documents including notes of interviews with employees and former employees, and the work product of forensic accountants. The judge at first instance had concluded that documents brought into being for the purposes of avoiding litigation (in this case, by self-reporting the matter to the Serious Fraud Office) could not be privileged. However, this was squarely rejected by the Court of Appeal, and the judgment has established that documents brought into existence for the dominant purpose of not only defending, but also resisting or avoiding reasonably contemplated criminal proceedings, will be protected by litigation privilege.

Of further interest is that the Court indicated that it did not agree with a previous decision (which was binding on it, but which had been widely criticised) which restricts who the 'client' is for the purposes of legal advice privilege to the employees tasked with seeking advice on behalf of the company. The Court indicated that it would prefer to expand this narrow view of the client to take account of modern multinational companies in which many employees may be required to interact with the company's lawyers.

In Sotheby's v Mark Weiss Ltd (see footnote 2), the High Court held that communications between a lawyer and a client with two purposes 'of equal importance and relevance' would not satisfy the dominant purpose test used to establish litigation privilege. In this case, the claimant commissioned a series of reports to inform certain commercial decisions and legal decisions. However, the High Court held that neither the commercial nor the legal angle could be determined as the dominant purpose of consequent communications about the reports between the company and its lawyers. The High Court also confirmed that even if litigation is the 'inevitable' consequence of taking a particular commercial decision, it must be shown that the dominant purpose of documents produced for making that decision is necessarily their use in the contemplated litigation.

In WH Holding v E20 Stadium LLP (see footnote 3) , the Court of Appeal confirmed that 'conducting litigation' (being one of the necessary elements comprising the test of litigation privilege) includes taking steps to avoid or settle litigation. However, to be covered by litigation privilege, the communications must have been made for the dominant purpose of obtaining advice or evidence in relation to the conduct of that litigation, rather than 'conducting litigation' in a broad sense. The Court of Appeal rejected the attempt to extend the scope of litigation privilege to cover purely commercial discussions, maintaining that the disputed documents (being emails between board members discussing a commercial proposal for the settlement of a dispute), were not covered by litigation privilege. The Court of Appeal did accept that litigation privilege could apply if advice or information obtained for the sole or dominant purpose of conducting litigation cannot be 'disentangled' from a broader document, or if it would otherwise reveal the nature of such advice or information.

Footnote 1: [2018] EWCA Civ 2006
Footnote 2: [2018] EWHC 3179 (Comm)
Footnote 3: [2018] EWCA Civ 2652

There have been no recent cases or other legal developments in Estonia regarding legal professional privilege. 

How to proceed when EU legal professional privilege is disputed during a dawn raid conducted by the European Commission investigating possible breaches of EU competition law?

The European Commission's powers in investigating anti-competitive behaviour include the power to conduct dawn raids to examine and copy books and other records found at the premises. Documents protected by EU legal professional privilege are an exemption to the European Commission's powers.

In the course of a dawn raid, if a document is protected by EU legal professional privilege, the person claiming EU legal professional privilege protection should give the European Commission's inspectors a cursory look at the headings of the document to demonstrate that the document is indeed protected by EU legal professional privilege. The person is entitled to refuse to allow the European Commission's inspectors to take a cursory look where the person believes a cursory look is impossible without revealing the content of the documents, and provides the European Commission's inspectors with appropriate reasons for this belief.

Where the protection of EU legal professional privilege is disputed during a dawn raid by the inspectors of the European Commission, the following procedure is to be followed:

1. The disputed document is placed in a sealed envelope.
2. The European Commission's inspectors may remove the sealed envelope from the premises.
3. If the matter cannot be resolved directly with the European Commission, the person claiming EU legal privilege protection may ask the Hearing Officer to examine the claims of EU legal professional privilege. The Hearing Officer may inspect the document and will communicate their preliminary view and take appropriate steps to propose a mutually acceptable decision.
4. Where no resolution is reached, the Hearing Officer will formulate a reasoned recommendation and deliver it to the European Commission, which is not binding on the European Commission but which the European Commission will examine.
5. The European Commission then takes a decision on whether or not to grant EU legal professional privilege protection to the document. The person claiming EU legal professional privilege may apply to the General Court of the EU to annul a negative decision by the European Commission.
6. The European Commission will not look at the document before the deadline for seeking annulment of the decision by the General Court of the EU has passed, or, if seeking annulment, before the annulment proceedings are closed.

Companies should exercise caution when making claims of EU legal professional privilege, as unwarranted and deceitful claims are prohibited and may be punishable by a fine.

Exchange of information within the European Competition Network

The European Competition Network consists of the European Commission and the national competition authorities of the 28 EU Member States, and allows them to cooperate on competition matters. The members of the European Competition Network have the power to exchange and use information collected for the purpose of applying EU competition law, including confidential information. National competition authorities may use information exchanged within the European Competition Network in order to enforce EU law, or to enforce their national competition law when it is applied in parallel with EU law and does not lead to a different outcome.

This has implications on the treatment of legal professional privilege. A national competition authority in one Member State (eg the UK) is able to obtain a document from an authority in another EU Member State which is subject to more relaxed legal professional privilege rules (eg Germany). A national competition authority, in this case, is thus able to obtain and use documents even if they were collected under rules which are less protective than its own. Companies, particularly large multinationals, must therefore ensure they have adequate and efficient policies to ensure that legal professional privilege protection is most effectively used.

Private damages actions for breaches of EU competition law

Natural and legal persons that have suffered damage due to breaches of EU competition law have a right to obtain damages from those found to have breached EU competition law. Private damages actions are brought in national courts of EU Member States. In order to increase the possibility of bringing private damages actions for breaches of EU competition law, an EU Directive has been adopted. The Directive requires all EU Member States to allow for courts to impose disclosure obligations in private damages actions for breaches of EU competition law. As regards such disclosure, the Directive requires EU Member States to 'ensure that national courts give full effect to applicable legal professional privilege under (European] Union or national law when ordering the disclosure of evidence'. It remains to be seen how EU Member States will implement that provision and when the EU or national legal professional privilege regime will apply in private damages actions for breaches of competition law. EU Member States have until approximately December 2016 to implement the Directive.

Legal professional privilege in the context of merger control

Due to rapid technological development in the past few years, the merger control landscape has made room for complex highly technical mergers. A lack of understanding of certain sectors or the level of complexity of some transactions can create uncertainty as to the potential theory of harm put forward by a competition authority.

This lack of understanding around new sectors has in turn led to substantial requests for information from competition authorities. In the past, the number of requested documents from the Commission were of several hundred, whereas now the number has increased to several hundred thousand. The Commission relies heavily on internal documents to assess the markets and the strategy of the parties involved.

Deadlines might not be proportionate to the volume and complexity of the information requested. Responding to an RFI that corresponds to thousands of documents requires having access to resources that some respondents might not have access to. Considering the above, it is evident that an undertaking that wishes to make any claims of legal privilege will be in a difficult position. Therefore, the excessive amount of information requested by the Commission effectively undermines the concept of legal professional privilege. However, the Commission may decide to stop the clock in merger control proceedings until the request for internal documents has been complied with, so as to avoid the withholding of internal documents by merging parties.

Evidently, legal professional privilege plays a more significant role in complex merger cases than it used to.

Legal professional privilege has not been clearly defined within the context of merger control. EU case law on legal professional privilege relates to cartel proceedings and there is no EU case law on merger cases so far. Nevertheless, legal professional privilege has been recognized as a fundamental right and therefore it cannot be disregarded within the context of merger control proceedings. Furthermore, the EU's submission to the OECD paper (mentioned in the 'scope' section above) put forward that the Commission typically applies the same principles derived from the existing case law also in merger control proceedings.

Given that there is lack of jurisprudence for legal professional privilege in the context of merger control, we would have to look at the past behaviour of the Commission which indicates a narrow interpretation of the EU case law relating to legal professional privilege. In practice, case teams can be more flexible in light of the increased volume of documents . This does not preclude the Commission from examining legal professional privilege claims more closely nowadays. Claims of legal professional privilege claims add a significant administrative burden of work on the parties. Legal professional privilege claims are submitted in privilege logs, which must set out the reason why a document or part of it is protected by legal professional privilege.

There are two practical aspects that need to be considered having to do with responsive documents covered by legal professional privilege and responsive documents covered by legal professional privilege rules of a third country.

Responsive documents covered by the EU legal professional privilege rules

Written communications emanating from an independent EU qualified lawyer to their client within the context of a merger control proceeding are protected by legal professional privilege. Communications that are not related to competition law proceedings, eg communications in relation to other areas of law such as employment or tax, are not covered by legal professional privilege. Additionally, communications dated before the competition law proceedings might be considered not to be covered by  legal professional privilege, given that they are not connected to the proceedings.

Company documents that reflect the legal advice obtained by external counsel are covered by legal professional privilege. However, it is quite common for company documents containing legal advice to also deal with other non-legal issues as well. In such cases, the documents will be partially redacted.

Responsive documents covered by third country legal professional privilege rules

When legal advice is being obtained by external counsel that are not EU qualified, this advice is not covered by EU legal professional privilege rules. The issue becomes more complex for transactions that have an international dimension, in which multiple competition authorities investigate a transaction.

It is quite common that authorities will ask for confidentiality waivers from the parties, in order to be able to exchange information with other competition authorities. If that is the case, the different ways in which legal professional privilege rules around the world apply can become problematic, given that some are less strict than others. Where this is the case, a document obtained by one competition authority can be disclosed to another competition authority, which the latter would not normally have access to under the legal professional privilege laws of its jurisdiction. In that regard, it is quite common that documents requested by the Commission are covered by US legal professional privilege but not EU legal professional privilege (eg in-house counsel communications), which can amount to a waiver of US legal professional privilege.

Below we set out some examples of communications and documents, and their respective treatment from the Commission in relation to legal professional privilege.

• Correspondence between client and external lawyer: Correspondence that emanates from an external legal counsel to the client is covered by legal privilege. However, the same does not necessarily apply for correspondence from the client to the external legal counsel. Such correspondence would have to be justified in the privilege log.
• Internal notes reflecting external legal advice: In Hilti the Court found that 'internal notes which are confined to reporting the text or content of those communications' with an independent lawyer containing legal advice are covered by legal professional privilege. The Commission sometimes interprets the reading of Hilti very narrowly as to consider only documents containing exclusively legal advice to be protected by legal professional privilege. However, the key message from Hilti is that the content of legal advice needs to be protected irrespective of the form of the communication that contains it. In practice, the Commission will ask for a partial redaction of documents that are partially covered by legal professional privilege.
• Legal advice not related to competition proceedings: The decisional practice in cartel cases indicates that legal professional privilege covers written communications between the client and their lawyer, after the initiation of a proceeding, and it can also extend to earlier communications if there is a link with the subject matter of the proceeding. Within the context of merger control, earlier communications between a lawyer and their client are protected by legal professional privilege if there is a link with the subject matter of the proceeding for a specific transaction. Legal advice that refers to alternative transactions would therefore not be covered by legal professional privilege.
• Correspondence with economists: legal professional privilege is limited to communications with lawyers. There is no EU case law dealing with communications with economists in merger cases. Moreover, the Best Practices Notice of the Commission clearly indicates that legal professional privilege does not extend to other professions, therefore it would be hard to make a legal professional privilege claim for correspondence with economists. However, advice obtained from economists, but vetted through an external lawyer, would likely be covered by legal professional privilege. The content of the correspondence with economists could be incorporated within the legal advice obtained by an external lawyer, which is evidently covered by legal professional privilege.

In a nutshell, legal professional privilege in merger control proceedings has acquired a new importance. It is imperative that companies have set up beforehand adequate mechanisms to respond to potential document requests from competition authorities in order to ensure that legal professional privilege in documents or communications is not undermined by the vast number of documents requested. In addition, even in circumstances where legal professional privilege would normally not be applicable, there might be ways to prevent documents from being disclosed. Communications emanating from EU qualified external lawyers are presumably covered by legal professional privilege. By incorporating within these communications information obtained by other professionals, there is the potential to extend the application of legal professional privilege to advice obtained from other professionals. However, this requires that no communications take place directly between the undertaking and the other professionals.

The Finnish provisions regarding production of evidence were reformed during 2014 and 2015. The amendments introduced, which entered into force in the beginning of 2016, have had a significant impact on the extent of legal professional privilege.

Most importantly, the prohibition to testify was extended in two senses. First, advocates and licensed legal counsel may no longer testify regarding information which has been obtained in connection with professional tasks that are not related to legal proceedings. However, the exception concerning ‘very important reasons’ was introduced in order to allow lifting an advocate’s or a licensed legal counsel’s prohibition to testify where exceptional circumstances exist. Second, the preparatory works of the amendments make it clear that, at least in tasks related to legal proceedings, the prohibition covers not only secrets and sensitive information of the client but also those of other parties.

The French Cour de Cassation has held that a seizure of documents en masse is valid despite the fact that it includes legally privileged documents (27/11/2013; 12-80336). However, the Court has also held that documents covered by professional secrecy must be returned (24/04/2013; 12-80336).

No details for this country.

'Jonas Day'-Decision of the German Constitutional Court on attorney-client privilege in internal investigations, dated 6 July 2018

The attorney-client privilege in Germany follows different concepts than in the US or the UK. The current legislation and jurisprudence regarding information and documents derived from internal investigations is ambiguous. The German Constitutional Court decided on 6 July 2018 on the seizure of documents at the office of Jones Day in Munich in connection with the Diesel-investigation of Volkswagen and its subsidiaries.

The Constitutional Court decided that in the case at hand the seizure of the documents did not violate constitutional rights of Volkswagen and allowed the review of the seized investigation documents. Further, the Constitutional Court pointed out that Jones Day, as non- EU based law firm cannot rely on constitutional protections regarding seizure of documents. On the other hand, the Constitutional Court ruled that a legal entity can rely on seizure protection even if the entity is not yet under investigation as long as the internal investigation is for concrete defence purposes which has to be decided on a case to case basis.

Based on the legislation and jurisprudence so far the following principles apply:

• Defence correspondence and defence documents and any work products of an internal investigation conducted by outside counsel, eg protocols of witness interviews, summary of results of review of documents, legal assessments, are privileged under German law and may not be seized.
• This applies also in case that the corporation is not yet formally investigated, but the internal investigation conducted by outside counsel serves the purpose to prepare the potential up-coming defence of the corporation (if this is the case has to be decided on a case to case basis).
• The results of an internal investigation conducted by in-house counsel or auditors is not protected, the authorities may seize these documents.
• If the internal investigation serves other purposes than the defence of the corporation, eg the preparation of claims against or the defence against claims of third parties, assessment of claims against (former) board members or to inform regulators abroad, it may be disputed whether a general attorney-client privilege applies to these documents.

Therefore, we made the following conclusions from the decision of the Constitutional Court:

• In the engagement letter it should be clearly stated to what extent the investigation is conducted for defence purposes and in the context of a corporate structure who the client is.
• The investigation should be performed by EU based law firms and by specialized corporate defence counsels.
• Those defence documents should be marked as such and be stored in custody of the mandated law firm.
• Documents and work products for other purposes, eg for remedial actions, civil litigation or for disclosure to foreign authorities, should be separated from purely defence documents.
• Those other purposes should also be clearly stated in the engagement letter in order to try to claim attorney-client privilege based on the relationship of trust.

The Law 3213/2003, as amended, on the obligations of particular categories of persons to submit to the tax authorities statements of origin of their ownership of assets (the doctrine of 'pothen eshes' – 'where from') provides for important exceptions to the protection of legal privilege (see above). By reference to the legislation on money laundering (the provisions of which are adopted), lawyers are obliged to inform the competent committees of any violation of the law on 'where from' and breach of such obligation constitutes a criminal offence (imprisonment of up to two years). According to the preamble of L. 4065/2012, 'any professional privilege is inflected and no obligations of confidentiality apply as against any person obliged to submit a statement of 'where from''.

It should also be noted that the law provides that in case a lawyer has to testify against their client, permission of the relevant Bar Association is required. The relevant jurisprudence refers to matrimonial matters, wills and child support, rather than corporate matters, and the permission is usually denied.

On 29 June 2015, the Hong Kong Court of Appeal in Citic Pacific Limited v Secretary for Justice & Commissioner of Police [2015] 4 HKLRD 20 (the 'Citic Decision'), rejected the restrictive definition of 'client' in the context of legal advice privilege taken by the English Court of Appeal in Three Rivers District Council v Governor and Company of the Bank of England (No. 5) [2003] QB 1556. In Three Rivers (No. 5), the English Court of Appeal ruled that the 'client' means the person or persons authorized by a corporation to seek and obtain advice from its legal advisers and therefore confidential internal communications within a corporation created with a view to putting the information before the legal advisers do not attract legal advice privilege.

The Hong Kong Court of Appeal did not follow the decision of the English Court of Appeal in Three Rivers (No. 5) and decided that a more liberal approach should be adopted. In essence, the Hong Kong Court of Appeal ruled that the client is simply the corporation and its employees should be regarded as being authorised to act for it in the process of obtaining legal advice. Therefore, legal advice privilege should not only be limited to communications passing between the client and its legal advisers, but should also cover a wider range of communications, including documents generated during the information gathering process.

The Hong Kong Court of Appeal found that a narrow definition of ‘client’ would basically frustrate the rationale behind legal professional privilege, which is to give effective and meaningful protection for confidentiality whilst clients obtain legal advice in any context. The Hong Kong Court of Appeal further held that the 'dominant purpose' test is more appropriate in setting proper limits for legal advice privilege, is consistent with authorities and rationale of legal professional privilege, and should therefore be the test to be adopted in Hong Kong.

On 5 September 2018, the UK Court of Appeal in Director of the Serious Fraud Office v Eurasian Natural Resources Corp Ltd [2018] EWCA Civ 2006 made specific reference to the Citic Decision to note that Three Rivers (No 5) is an outdated decision that fails to reflect the nature of modern day multinational corporations.

No details for this country.

No details for this country.

Defender Ltd v HSBC [2018] IEHC 587, High Court, Twomey J, 15 October 2018

Whether privilege can be claimed over witness statements which have been delivered to the opposing party is a question that was considered by the Irish High Court in Defender Ltd v HSBC.

In summary, the position in Ireland is that a witness statement does not lose its status as a privileged document once it is served and that privilege is preserved until the witness statement is "adopted by the witness or otherwise put into the public arena."

The plaintiff, Defender Limited (Defender), invested with Bernard L Madoff Investment Securities LLC (Madoff) and suffered losses when Madoff’s investment business was exposed as having operated the world’s largest Ponzi scheme. Defender then issued proceedings against HSBC in its capacity as Defender’s custodian, claiming negligence and breach of contract.

During the course of the proceedings, Defender sought copies of witness statements that had been delivered by HSBC in two separate sets of proceedings which Defender was not involved in. Both sets of proceedings involved funds (Thema and Primeo respectively) that alleged negligence against HSBC following the exposure of Madoff’s fraud. The Thema proceedings were heard by the Irish High Court. The proceedings settled after 17 days and therefore not all of the witness statements sought were adopted in Court. The Primeo proceedings, however, were heard in full by the High Court of the Cayman Islands. HSBC claimed privilege in respect of the witness statements sought.

The High Court held that the witness statements delivered in the Primeo proceedings had lost their privilege during the course of the trial as they had been adopted in open court by the relevant witnesses. The High Court ordered that the Primeo witness statements be made available to Defender on discovery.

In relation to the Thema witness statements, a question arose as to whether privilege is lost when a witness statement is delivered to the opposing party but not adopted in open court. The High Court noted that there are policy reasons for preserving the privileged status of witness statements and emphasised in particular the importance of frank and honest witness statements to encourage settlement between the parties and the benefits of retaining privilege over witness statements until "the last minute". The High Court held that a witness statement does not lose its status as a privileged document once it is served and that privilege is preserved until the witness statement is "adopted by the witness or otherwise put into the public arena."

As the concept of "once privileged, always privileged" does not exist in respect of litigation privilege in Ireland, and the privilege ends when the proceedings end unless another set of proceedings is considered to be sufficiently closely related in order to allow the privilege to continue, the High Court also considered whether the Thema and Primeo proceedings were sufficiently closely related to the Defender proceedings. The High Court held that, while the overlap of parties involved in the various sets of proceedings was relevant, more significantly, the subject matter of all three cases are closely connected, since they involve claims by three different funds against a HSBC company that, inter alia, the HSBC entity was negligent in relation to its alleged use of a Bernie Madoff company as a sub-custodian for the assets of the funds.

The High Court therefore found that, to the extent that privilege exists in the witness statements, that privilege would "prevent the discovery of those documents to Defender, because although the Thema and Primeo Cases have finished, they are closely connected with the Defender Case."

There do not appear to be any recent cases and other legal developments in Israel regarding legal professional privilege.

The Supreme Administrative Court has held that legal professional privilege does not apply to internal notes of the company (see CdS. 24 June 2010, No. 4016).

With Legislative Decree No. 3 of 19 January 2017 Italy implemented EU Directive 2014/104/EU of 26 November 2014, according to which:

'Member States shall ensure that national courts give full effect to applicable legal professional privilege under the Union or national law when ordering the disclosure of evidence'.

As provided by Art. 3 of Legislative Decree No. 3 of 19 January 2017:

'In the actions for damages for infringements of the competition law provisions, upon receipt of a party's reasoned request,[…] the judge can order the parties or a third party to disclose relevant available evidence in accordance with the provisions of this Chapter. […] This is without prejudice to the confidentiality of communications between lawyers in charge of a party's representation and the client itself'.

In Japan, there is a Legal Apprentice (Shihou-Shuushuu-Sei) programme which is a national legal training system for lawyers, judges and prosecutors who have passed the Bar exam. All legal apprentices study legal practice for one year under the supervision of experienced judges, prosecutors and lawyers. Under the rules regarding Legal Apprentices formulated by the Supreme Court (Article 3), legal apprentices are also obliged to hold in confidence information that they have come to know while acting as an apprentice.

There do not appear to be any recent cases or other legal developments in the State of Kuwait regarding legal professional privilege.

No details for this country.

There do not appear to be any recent cases or other legal developments in Lebanon regarding legal professional privilege.

In Lithuania, the concept of legal professional privilege is still developing. Therefore, the court practice is not always consistent. For example, in one of its judgments in a criminal case, the Supreme Court of Lithuania took a position that legal professional privilege extends to communications only in cases where there is a binding written agreement for provision of legal services concluded between the lawyer and the client, and only subject to a condition that such communications directly relate to the legal services specified in such agreement. In contrast, there have been subsequent cases where lower courts of Lithuania held that oral agreements for provision of legal services are sufficient for the purposes of application of legal professional privilege.

No details for this country.

No details for this country.

In Hon. Joe Mizzi v. The Office for Competition (Onorevoli Joe Mizzi v. Ufficju ghall-Kompetizzjoni), decided by the Competition and Consumer Appeals Tribunal in 2013, the juxtaposition of national rules and the special rules relating to antitrust and competition proceedings was considered.

The Office for Competition ('Office') opposed a demand for the production of documents in the file held by the Office concerning a decision made by the Office. The tribunal referred to rule 9 of the Rules of Procedure contained in the Malta Competition and Consumer Affairs Authority Act relative to the Competition and Consumer Appeals Tribunal.

Rule 9 states: 'In the interpretation of this Act, the Appeals Tribunal shall have recourse to the judgements of the Court of Justice of the European Union, and to relevant decisions and statements of the European Commission, including interpretative notices on the relevant provisions of the TFEU and secondary legislation relative to competition and may also refer to its previous decisions'.

The tribunal took the view that it should first look to national law to resolve issues that may arise during the proceedings, and it is in the absence of a provision of national law or in the absence of clarity that the tribunal must have recourse to the provisions of rule 9.

The tribunal stated that the Malta Competition and Consumer Affairs Authority Act is a special law, and where this special law does not specify otherwise, the European Union sources referred to in rule 9 should be applied. The tribunal specifically included European Commission rules relating to Commission proceedings as applicable European Union sources. The tribunal stated that the Rules of Procedure contained in the Maltese Code of Civil Procedure, qua general law, gives the tribunal discretionary powers in the interests of justice, but this discretion must be used most restrictively.

In this particular case, the tribunal held that national law was silent as to whether the file of the Office could or should be produced in the proceedings. The documents in the file that were instrumental in arriving at the Office’s decision had in fact already been produced. The documents demanded in these proceedings were not so instrumental, and therefore the tribunal held that it should follow the European Union regulatory norm, and the circumstances did not warrant the use of the discretion given to the tribunal by general law to compel the Office to produce the documents.

The applicability of EU competition procedural rules to local competition proceedings was confirmed in Liquigas Malta Limited vs Office for Competition decided by the Competition and Consumer Appeals Tribunal on 14 April 2015. The reference was to competition procedural rules in general, which are likely to include those relating to legal professional privilege.

There are no significant court precedents regarding legal professional privilege. The two most relevant establish that:

• Persons with privileged information may only disclose it in civil or criminal procedures with the consent of the client.
• The authorisation made by litigation counsel to third parties to review the file of a procedure does not constitute a violation of the professional secrecy obligation.
• The recently enacted Mexican Anti-Money Laundering Law and its Regulation establish the obligation to file reports with the Mexican Tax System Administration detailing specific information of certain transactions carried out by lawyers advising their clients. Such reporting obligation is considered an exception to legal professional privilege.

Commentary on the law n°43-05

The anti-money laundering law n°43-05 brought important exceptions to the legal professional privilege as it imposes a declaration of suspicion to lawyers when they receive from their clients information which may lead them to think that their client may be found guilty of anti-money laundering.

Furthermore, the lawyers cannot invoke the legal professional privilege to refuse to communicate information to the administrative or judicial authorities investigating about cases of anti-money laundering.

By judgement of 15 March 2013 (ECLI:NL:HR:2013:BY6101), the Dutch Supreme Court (Hoge Raad) confirmed the legal professional privilege for in-house attorneys who have been admitted to the Bar and comply with requirements guaranteeing their independence. This principle therefore applies in the Netherlands with regard to all fields of law, except in the event of an investigation in the Netherlands by the European Commission.

By judgements of 26 January 2016 (ECLI:NL:HR:2016:110) and 6 June 2017 (ECLI:NL:HR:2017:1018), the Dutch Supreme Court confirmed that when a lawyer is copied in on an email or is requested to be present at a meeting with the apparent sole purpose of bringing the contents of that email or meeting within the scope of legal privilege, the lawyer is not acting “in his capacity as a lawyer” and cannot invoke the protections of legal professional privilege.

By judgement of 7 October 2019 (ECLI:NL:RBROT:2019:7856) the Rotterdam District Court clarified the position of external lawyers and in-house counsel admitted to a foreign Bar.

Law Commission review and recommendations

The New Zealand Law Commission is required to review the Evidence Act 2006 every five years. As a result of the first review, completed in February 2013, a number of changes were enacted by Parliament.

The Law Commission published an Issues Paper as part of its second review on 28 March 2018. The Law Commission is currently seeking submissions and will formulate recommendations based on those submissions to be presented to the government in 2019.

Recent case law of interest

Sheppard Industries Ltd v. Specialized Bicycle Components Inc [2011] NZCA 346, [2011] 3 NZLR 620 Sheppard concerned ‘settlement privilege’. The parties went to mediation in an attempt to settle proceedings that had been filed. The mediation agreement, on at least one reading, required written agreement for there to be settlement of the dispute. No written settlement agreement was entered into. The Court of Appeal found that it was not possible to contract out of the statutory exception to settlement privilege in respect of ‘evidence necessary to prove the existence of such an agreement in a proceeding in which the conclusion of such an agreement is in issue’. On that basis, the Court allowed evidence to be led to determine whether the parties had reached a binding oral settlement agreement at conclusion of the mediation, regardless of the fact that the mediation had been conducted on a confidential and ‘without prejudice’ basis.

R v Bain [2008] NZCA 585 In Bain, the defendant had been convicted of murdering members of his immediate family. The defendant signed a waiver of privilege for the sole purpose of an inquiry by the Ministry of Justice in relation to a petition by the defendant for exercise of the royal prerogative of mercy. This constituted a limited waiver. Privileged material was then adduced in evidence in open court (with the defendant’s consent) and released into the public domain by way of publication of the judgment. During hearings before the Court of Appeal, counsel also referred to that material. Accordingly, the Court found that confidentiality was lost in relation to the (originally) privileged material as there had been consent as to its disclosure and, therefore, the privilege had been waived for the purpose of the defendant’s retrial.

Gowing & Co Lawyers Ltd v Police [2013] NZHC 2177 Gowing concerned a letter prepared by the defendant in a criminal proceeding for delivery to the complainant which contained certain self-incriminating statements.The letter was given by the defendant to another person who refused to pass it on to the complainant as requested by the defendant. The letter was returned to the defendant, who then provided it to his legal adviser during a meeting. It was argued by the defendant that the letter attracted lawyer / client privilege as it was provided to the defendant’s legal adviser during a ‘privileged meeting’. The court found that the letter did not attract the privilege for the following reasons:

• There was no intention that the letter remain confidential
• The letter was not created for the purpose of obtaining professional legal services, and
• Disclosure of the letter would not reveal legal advice provided to the defendant by his legal adviser

Smallbone v London [2015] NZCA 391 Smallbone was the plaintiff in a successful defamation action in the High Court. The trial was a credibility contest between Mr Smallbone and his ex wife Ms London. The judge entered judgment but before judgment could be sealed, he recalled the judgment on the basis that the defendants wanted to be heard on the damages award. The defendants made several applications, including for an order admitting the affidavit evidence of Witness Z, a woman who knew Mr Smallbone after his marriage to Ms London. Witness Z gave a materially similar account to Ms London of Mr Smallbone's behaviour. Witness Z also said that before trial, Mr Smallbone had met with her and asked her to give evidence to the effect that he was not the sort of man who would do the things Ms London alleged and that he would pay her for her false testimony. Witness Z declined to give false testimony. Mr Smallbone denied Witness Z's allegations and said that he did ask her to make a statement but that she demanded money and refused to be involved when he did not agree to pay. The judge admitted Witness Z's affidavit and then set aside the jury verdicts and ordered a retrial. The matter went to the Court of Appeal on a jurisdiction point but also included the ancillary matter of whether one of the defendants could claim litigation privilege in an affidavit of documents for communications with Witness Z. While it was not in dispute that litigation privilege applied to these communications, the argument was that the privilege should be disallowed on the ground that it was made for a dishonest purpose or to enable or aid Witness Z to commit perjury. The Court of Appeal held that to sustain an application for disallowing privilege on the basis that a communication was made for a dishonest purpose to enable a witness to commit perjury, an applicant must show a prima facie case of dishonesty and / or criminal purpose on behalf of the witness in relation to the privileged communications. The threshold is high. The Court declined to draw an inference of criminal purpose from mainly circumstantial evidence and the application for such an order was dismissed.

Beckham v R [2016] 1 NZLR 505 Beckham was an appeal against a decision of the Court of Appeal dismissing an appeal against conviction for serious drug offenses and money laundering. The issue was whether the appellant should have received a reduction in his sentence for breach of his rights under the New Zealand Bill of Rights Act 1990. As part of the appeal, Mr Beckham was given leave to raise new allegations of breaches of privilege, the focus being on phone calls he made to people other than his lawyer and which he claimed were subject to solicitor / client privilege and / or litigation privilege:

• In respect of three phone calls to his partner, Mr Beckham claimed solicitor / client privilege. The Supreme Court held that solicitor / client privilege could potentially apply where an accused person gives instructions to their lawyer through an intermediary, as Mr Beckham's partner was in this case. However, Mr Beckham had to establish that the calls involved communications made in the course of and for the purpose of obtaining legal advice for Mr Beckham in relation to his case. It was not clear whether the discussions between Mr Beckham and his partner were communicated to his lawyer and it was at best, equivocal whether that was even the intention. Solicitor / client privilege did not therefore attach to the communications.
• In relation to litigation privilege, this was claimed by Mr Beckham in respect of certain phone calls between him and his partner, and him and his son, and where trial strategy or potential witnesses were discussed. Only small portions of the calls were the subject of litigation privilege which suggested that the dominant purpose of the calls between Mr Beckham and his partner and son were family and personal matters rather than preparation for the trial. Mr Beckham argued that it was not necessary to establish that the dominant purpose of each call was preparation for trial, but rather that the dominant purpose of the particular excerpt from the call for which the privilege claim was made was for the purpose of preparing for trial. The Supreme Court held that it was consistent with the intention of the legislature to apply the dominant purpose test with some rigour. While in some cases, a proper delineation can be made between different parts of a document (by severing material prepared for the purpose of trial from other material), it was harder to do this in relation to discursive and wide ranging telephone conversations where topics are intertwined. The Supreme Court ultimately held that the overall purpose of the communications was simply to keep in touch and to discuss normal domestic and business matters rather than preparation for trial. The Supreme Court also held that a requirement for confidentiality was consistent with litigation privilege. It was also consistent with the concept of waiver, which occurs when a person claiming privilege has voluntarily disclosed or consented to the production of privileged communications in circumstances which are inconsistent with a claim to confidentiality. The telephone calls for which litigation privilege had been claimed had not been made in circumstances where there was an expectation of confidentiality because Mr Beckham had admitted that he had made the calls from a monitored phone and that he knew the calls were being monitored. There was no necessary confidentiality in respect of the phone calls.

Historically, there is a debate between the National Authority for Investigation and Prosecution of Economic and Environmental Crime ('Økokrim') and the Norwegian Bar Association on the privilege of lawyer / client information. Økokrim has been arguing that legal professional privilege is an obstacle to its work against white collar crime, and has been asking for new regulations to limit legal professional privilege. The Norwegian Bar Association has, on its part, been clear about the importance of trust and confidentiality in the lawyer / client relationship and that lawyer / client legal privilege is a fundamental part of this.

This debate culminated in the mandating of a task force to propose legislative changes in relation to legal professional privilege in general (see footnote 1).  So far no changes have been made although it was proposed to enhance the scope of privilege by statue specifying that the principle covers all information in connection with a lawyer's assignment, including the lawyer's advice.

In December 2010, the Supreme Court concluded that information regarding money transfers as part of the lawyer's legal practice, as well as the client's identity in a specific instruction for legal advice, was privileged information (see footnote 2). This view was further sustained by a High Court ruling in 2011. In 2012, the Supreme Court stated that even when a lawyer is subject to bankruptcy proceedings, information on names of clients and on money transfers between lawyer and client will be subject to legal professional privilege, and supersede any duty of disclosure unless  otherwise provided by a clear statutory provision (see footnote 3). The Supreme Court has assumed that the lawyer can, without prejudice to the duty of confidentiality, recover outstanding fees, even if such action results in the client relationship being disclosed (see footnote 4).

In 2013, the Supreme Court concluded that evidence in the form of email correspondence will be considered privileged information if it is sent as a copy to the lawyer, regardless of whether the lawyer has had access to its content (see footnote 5). However, taxation and VAT legislation was retrospectively amended so that a lawyer is required, regardless of legal professional privilege, to give transaction data, and balance and debt information (including in relation to the parties to the transaction), to the government. The Supreme Court has also found that email correspondence between a tax payer and their lawyer is exempt from review by the Tax Authorities without further examination (see footnote 6). In 2018 the Supreme Court also rejected Økokrim's request for access to a lawyer's time sheets (see footnote 7). In addition, the Supreme Court clarified the duty to produce legally privileged material (in this case a lawyer's annual accounts) in a redacted version as evidence in a law suit (see footnote 8).

Footnote 1: NOU 2015:3
Footnote 2: Rt-2010-1638
Footnote 3: HR-2012-00788-A
Footnote 4: Rt-2012-608
Footnote 5: Rt-2013-1336
Footnote 6: HR-2017-467-A
Footnote 7: Rt-2018-109
Footnote 8: HR-2018-2403-A

There do not appear to be any recent cases or other legal developments in the Sultanate of Oman regarding legal professional privilege.

On the basis of the latest amendment to the Polish Criminal Procedure, evidence that is obtained illegally by authorities can be used in criminal cases. It is likely that this change may have a negative impact on legal professional privilege protection.

As of 1 Jan 2019, the very recent amendment of Polish tax law pertaining Mandatory Disclosure Rules entered into force. The Act transposes the Council of the European Union (EU) Directive 2018/822 of 25 May 2018 and makes the so-called promoters (ie tax advisors, advocates and attorneys-at-law) subject to the obligation to submit to the Head of National Revenue Administration information about tax schemes. The obligation to disclose arrangements applies not only to cross-border arrangements, but also to some domestic arrangements in Poland. In specific situations, it may be the case that advocate or attorney-at-law will be the party notifying about the tax scheme to the authorities (after the consultation with the client). As a result, the professional privilege is such cases is waived.

There is ongoing litigation regarding this subject matter in criminal and civil litigation, as well as in litigation concerning investigations of alleged competition infringements (which are misdemeanors). As concerns the latter and on the basis of public info, court actions concern primarily Competition Authority’s actions in the context of surprise inspections ('dawn raids'). For instance, as regards the seizure and reading of e-mail communications sent or received by lawyers by the Competition Authority’s officials, undertakings are currently arguing their illegality.

As for recent legal developments, it is relevant to highlight that the Private Damages Directive has been transposed by Law nr. 23/2018, of 5 June. If, on the one hand, the Directive provides that consistency is particularly necessary in what regards the arrangements for access to documents held by national competition authorities, on the other hand provides for a restriction on disclosure of evidence covered by legal professional privilege. This is also provided in Law no. 23/2018.

There do not appear to be any recent cases or other legal developments in the State of Qatar regarding legal professional privilege.

Recent legal developments

The scope of the documents covered by legal privilege has been narrowed down following recent amendments to the Competition Law, entered into force on 1 January 2016. As a consequence, the RCC inspectors will be able to seize and use as evidence preparatory documents.

Case Law

To our knowledge, there are only few court decisions regarding the privileged nature of documents seized by the Romanian Competition Council during a dawn raid.

In these cases (Bucharest Court of Appeal, Alpiq Romindustries SRL. and Energy Holding SRL v. The Romanian Competition Council, Decision no. 5938 from 22 October 2010 and Decision no. 7074 from 11 December 2012, decisions maintained by the High Court of Cassation and Justice through its Decisions no. 5881 from 20 June 2013 and no. 7707 from 11 December 2013, and High Court of Cassation and Justice decision no. 7707/2013), the documents for which the application of legal professional privilege was invoked were legal opinions of the external lawyers issued prior to the beginning of the investigation in respect of the relationships between the undertakings involved in the case.

The Bucharest Court of Appeal rejected the claims on the ground that the legal advice referred to purely commercial considerations and was not related to the right of defence of the undertakings investigated in relation to the enforcement of the competition rules. The High Court of Cassation and Justice irrevocably rejected the appeals made. The High Court of assation and Justice also defined the right of defence (for the purpose of legal professional privilege application) as including all the rights and procedures a person may employ for the purpose of defending its fundamental rights and liberties, in the cases where the breach of certain legal provisions may entail the application of an administrative or criminal fine, as the case may be. The document in question related only to the parties contractual relationship and did not have a connection with the potential anticompetitive nature of such relationship.

Legal professional privilege in the context of merger control

To our knowledge, legal professional privilege has not been invoked in practice in connection to merger control procedures.

However, as legal professional privilege covers communication exchanged between an investigated undertaking and the external lawyer, it may be inferred that correspondence exchanged with a lawyer is only protected in the context of an investigation and not in the context of other type of procedures in front of the Competition Council, such as merger control procedures.

Furthermore, the High Court of Cassation and Justice has adopted a narrow definition of the right of defence concept (for the purpose of legal professional privilege application) in the above mentioned decisions. As such, the right of defence refers to all the rights and procedures a person may employ for the purpose of defending its fundamental rights and liberties, in the cases where the breach of certain legal provisions may entail the application of an administrative or criminal fine.

No details for this country.

There do not appear to be any recent cases or other legal developments in Saudi Arabia regarding legal professional privilege.

Holman Fenwick Willan LLP v Procurator Fiscal, Glasgow 2017 HJAC 38: High Court decision relating to the recovery of privileged documents from a solicitor's office. The court held that where a search warrant had been obtained by the Crown for material over which there was an ongoing dispute about legal privilege, with no suggestion that the relevant solicitors' firm were involved in any form of illegality or any averment that it would be likely to destroy or conceal the relevant material, the application for the warrant, without intimation, was oppressive.

We expect to see changes in this area as Serbia gets closer to joining the EU. Consequently, the changes would probably mean that national law would become more compliant with acquis communautaire.

The recent amendments to the Evidence Act, which clarify that the protections under sections 128 and 131 extend to in-house counsel, place renewed emphasis on the purpose test where legal professional privilege is concerned. Per their terms, the protections afforded by sections 128A and 131(2)(b) are available only where communications to and from the in-house lawyer are made 'in the course and for the purpose of his employment as such legal counsel'.

In Boey Chun Hian v. Singapore Sports Council [2013] SGHCR 15, the High Court indicated that a large volume of documents could be generated within a corporation, and that many of them may pass through the hands of the in-house counsel. The High Court considered that mere submission of a document to an in-house counsel should not easily attract a claim to legal professional privilege, as the effect would be that an excessive numbers of documents would be excluded from production in discovery, yet would still remain available for use by the party possessing those documents in a manner that would surprise their opponent. The High Court therefore favoured the application of the 'dominant purpose' test to determine whether legal advice privilege attaches to particular documents. This was clearly intended to curtail and discourage excessively broad claims to legal advice privilege when dealing with documents that have been provided to in-house counsel.

In HT SRL v Wee Shuo Woon [2016] 2 SLR 442, the Singapore High Court held that the fact that a document was privileged (and illegitimately or inadvertently released to an opposing party) would not in itself be a bar to its admissibility as evidence. The court could, however, exercise its equitable jurisdiction to regulate the improper use of privileged documents that were improperly or inadvertently disclosed to protect its confidential character. In this case, the fact that the privileged documents were obtained as a result of the commission of cybercrime by a third party, was a key factor motivating the court's exercise of equitable jurisdiction to preclude the admissibility of the disclosed privileged documents.

In the case of ARX v Comptroller of Income Tax [2016] 5 SLR 590; [2016] SGCA 56, the Singapore Court of Appeal clarified the scope of the Evidence (Amendment) Act 2012. The decision confirmed that communications with in-house counsel, even if they existed prior to the 2012 amendments, are protected by legal professional privilege. The Evidence Act was held not to detract from the existence of the common law principle that privilege extends to in-house counsel. Furthermore, the Court of Appeal clarified the applicable test for implied waiver of privilege and stated that a fact-sensitive exercise of judgment and objective enquiry is required. The mere reference to a privileged document in legal proceedings, as opposed to disclosure of its contents, did not constitute an implied waiver. When determining whether reference to a privileged document amounts to the existence of implied waiver, a court should examine all circumstances of the case including:

• The materiality of the information in the context of the pending proceedings
• The circumstances under which the disclosure took place
• Whether it may be said that the party had 'relied' or 'deployed' the advice to advance their case
• Whether it can be said that there is a risk that an incomplete and misleading impression had been given

Legal professional privilege is not expressly recognised in Slovak legislation. There is unfortunately no case law in this respect, therefore it is difficult to anticipate the standpoint of the Slovak courts on this. According to recent information, however, the Slovak Competition Authority is proceeding in line with the case law of the Court of Justice of the EU, thus its procedure in the course of investigations shall be similar to the procedure of the European Commission in the course of investigations.

In line with this, the company shall prove to the Authority that:

• the respective document related to the subject of the investigation, and
• the document/correspondence relates to the communication between the undertaking and its advocate.

For this purpose, the employees of the Authority conducting the investigations do have the right to look into the document in order to identify to whom this document is designated, but they have no right to investigate the content of such document. If the company will not allow the Authority’s employees to look into the document, it will have to provide to the Authority sufficient evidence that indeed these documents present information relating to the communication with the advocate.

The Slovenian case law regarding legal professional privilege is still in development.

In this connection, one case can be mentioned: in 2007, the criminal police searched a lawyer’s law office, not considering the provisions of the Bar Act that a house search of a law office shall be restricted or limited only to the records and objects explicitly stated in the ordinance of investigation. In this particular case, the ordinance was not specific enough and the police searched the whole law office and not just the relevant files. Due to this unlawful ordinance, the representative of the Bar left the premises of the law office in protest. He was ultimately fined for not being present at the house search and this provoked a strong reaction from the Bar.

• In the matter of The Competition Commission v. Arcelormittal South Africa Ltd, delivered by the Supreme Court of Appeal in May 2013, it was held (in the context of the Commission’s corporate leniency policy) that reference to a part of a document sufficient to constitute waiver destroys the legal professional privilege attached to the entire document, and not just the part referred to (unless the document consists of severable parts and is capable of severance).

• In A Company and Two Others v The Commissioner for the South African Revenue Service 2014 (4) SA 549 (WCC) the court held that where a fee note sets out the substance of the privileged communications in respect of the person seeking or giving of legal advice, or contained sufficient particularity of their substance to constitute secondary evidence thereof, those parts, but not the document as a whole, would be amenable to the privilege. The test was whether, upon an objective assessment, the references disclose the content, and not just the existence, of the privileged material. The privilege should be asserted by blacking out the information, so as to disclose those parts of the document that were not subject to the privilege and covering up those that were, and that the party asserting the legal professional privilege should generally be able to provide a rational justification for such claim without needing to disclose the content or substance of the matter in respect of which the privilege is claimed.

• The right to privilege is also recognised by the Promotion of Access to Information Act 2 of 2000, which was enacted to give effect to the right to access to information. This piece of legislation upholds privilege by firstly excluding its application to pending litigation, where the rules of discovery remain unchanged, and secondly prohibiting access to privileged records.

On May 17, 2012, the Supreme Court of Korea ruled on whether a legal memorandum which contained a client's admission of guilt could be used as incriminating evidence in court (Case Number: 2009 Do 6788). The court held that Article 149 of the Criminal Procedure Act granted lawyers the right to refuse testimony when asked whether the lawyer had prepared the legal memorandum.  However, if the lawyer acknowledges that they produced the legal memorandum, thereby waiving the right to refuse testimony, then the legal memorandum can be used as incriminating evidence.

The court emphasized that the inadmissibility of the legal memorandum was not by virtue of 'lawyer-client privilege,' explaining that lawyer-client privilege does not extend so far as to protect clients seeking routine legal advice against whom investigations/trials have not yet commenced. The reluctance of the Supreme Court of Korea to rely on the principle of lawyer-client privilege in reaching its decision has invited some criticism from the Korean legal community.

In August 2016, the Korean Prosecution instituted an investigation against the owner family of the Lotte Group for tax evasion. During that process, the Prosecution reportedly summoned as witnesses and questioned the lawyers from the law firm that provided legal advice to the owner family, and also applied for a search warrant in respect of the tax related materials held by the owner family. The court issued the warrant, and given the impending threat of additional warrants being issued against the law firm, the law firm had to 'voluntarily' submit its materials related to this case.

The Korean Bar Association issued a statement criticizing the actions of the Prosecution for such investigative practices.

In late 2018, one of the top tier law firms in Korea was raided by investigative authorities for allegedly attempting to influence the outcome of a politically high-profile case involving the former Supreme Court Chief Justice. The incident related to a case that is politically sensitive in Korea, and it remains to be seen whether the Korean courts will eventually be open to accepting and broadening the concept of legal professional privilege.

From the criminal law perspective, the Spanish Supreme Court convicted not too long ago a judge that breached the professional secrecy between lawyer and defendant by taping their private conversation without the required legal grounds (judgment of the Supreme Court of 9 February 2012). In this regard, a judgement of 24 November 2015 issued by the Supreme Court also recognises the right of a lawyer to refuse to declare against their client regarding the information obtained as a result of their professional activity. 

The most recent Supreme Court case law (Judgement No. 451/2018 of 10th October) stated the following:

• The basis of the obligation are the trust and confidentiality of the client relationship.
• The violation of this duty implies an injury of the client´s rights to the intimacy and to the effective legal protection.
• The obligation begins at the pre-trial moment, inasmuch as the future part of the eventual process has to be free to provide the lawyer who assists them with all the information in order to guarantee an effective defence.
• The lawyer is also exempted from the duty to denounce according to the art. 263 of the Spanish Criminal Procedure Act (without prejudice to the legal limitations in relation to the configuration of such professional secrecy).

From the civil perspective, there are relevant precedents such as the judgment number 6/2018, issued by the High Court of Valencia (Audiencia Provincial) on 16 January (appeal number 355/2017). In this case, a lawyer acted as a witness. In the hearing, the lawyer recognised that he was appointed as a lawyer by the plaintiff in criminal proceedings against the defendant and that an amicable settlement had been agreed between both parties (plaintiff and defendant). By means of this agreement a debt was recognised and the criminal complaint filed by the plaintiff was withdrawn. The Court held that, these statements did not infringe the lawyer's obligations of professional secrecy.

Swedish legal professional privilege has most recently been discussed in a case following the Swedish Competition Authority's dawn raid on Swedish postal companies (decision number Ä 6673-11 of 22 June 2011). In the decision by the District Court of Stockholm, the Court provided that Swedish legal professional privilege should be interpreted in accordance with EU law. The Court held that a minimum, but not maximum, level of privilege was provided for in the European Court of Justice's decision in the AM & S Europe case (case 155/79). However, it was maintained by the Court that Swedish legal professional privilege was more far reaching than the minimum EU standard in so far as Swedish legal professional privilege protects almost every document which has been confided to an advocate in their professional legal capacity. In order for the protection provided not to be hollowed out, the Court furthermore held with reference to Swedish Supreme Court decision NJA 1990 s 537 and NJA 2010 s 122, which held that it was only 'to a modest extent' necessary to show that the document was protected by legal professional privilege. In that case, the in-house counsel, who was not an advocate, had prepared a document of interest to the authority. The in-house counsel could however provide an email which indicated that the memorandum had been confided to the company's external counsel, an advocate, and therefore the Court deemed the document protected by legal professional privilege.

No details for this country.

In 2002, there was a case in which a lawyer was punished by the Lawyer Conduct Committee due to his violation of Clause 11 of the Regulation of Lawyer Conduct.

Pertaining to the probe conducted by the Lawyer Conduct Committee, they found that he had disclosed confidential information obtained from his client to the adverse party which caused damages to the client. The Lawyer Conduct Committee then ordered the removal his name from the lawyer register.

The Turkish Competition Board evaluated legal professional privilege in one of its decisions (dated 13.10.2009 and numbered 09-46/1154-290) and followed an approach similar to that of the European Commission. The Competition Board indicated in its decision that, in order to deem the information privileged, the lawyer shall be independent, and the relevant document must be produced in the scope of a lawyer/ client relationship. Secondly, the Competition Board indicated that the information must be subject to the right of defence of the client.

Additionally, there must be a causal link between the lawyer’s practice and the information obtained in order to deem such information privileged.

In a decision by the Constitutional Court (dated 14.11.2011, merit number 2009/19013 and decision number 2011/21017), it was held that the Supreme Court deems that the lawyer can avoid disclosing the whereabouts of their client as per their obligations regulated in the Legal Profession Law and European Convention on Human Rights. The Constitutional Court stated that the trust and loyalty is in the nature of the 'client-lawyer relationship'. Moreover, according to the decision, the parties may raise their objections not only to the judiciary bodies of the Turkish Republic but also to the administrative bodies.

No details for this country.

There do not appear to be any recent cases or other legal developments in the UAE regarding legal professional privilege.

In June 2014, the United States Court of Appeals for the District of Columbia Circuit ('DC Circuit'), in the case of In re Kellogg Brown and Root, 756 F.3d 754 (D.C. Cir. 2014), strengthened the application of the lawyer-client privilege in situations in which in-house counsel is leading a company's internal investigation. The trial court had held that the privilege did not apply when an investigation is being conducted to determine whether the company was complying with government regulations that require companies to maintain compliance programmes or respond to allegations of wrongdoing. The lower court concluded that in-house counsel did not have the same privilege protections as retained outside counsel and that was particularly so when the internal investigation involved communications with non-lawyers who were working under the direction of the in-house lawyers. The DC Circuit reversed the decision and concluded that:

• A lawyer's status as in-house counsel 'does not dilute the privilege'
• The fact that the investigation was being conducted by non-lawyers does not vitiate the privilege as long as the non-lawyers were working under the direction of the legal department
• The privilege is not lost simply because employees being interviewed were not told that the purpose of the interview was to assist the company in obtaining legal advice, and
• Even if there is a business purpose for the interviews – such as assessing compliance with governmental regulations – the privilege will still apply if 'one of the significant purposes of the internal investigation was to provide legal advice'

In 2018, the DC Circuit also clarified the proper application of the so-called 'primary purpose test,' which provides that a communication between an attorney and client is privileged if its primary purpose is to seek or provide legal advice. Application of this test can become complicated when the client and attorney discuss both legal and business issues in the course of their communication. In FTC v. Boehringer Ingelheim Pharmaceuticals, Inc., 892 F.3d 1264 (D.C. Cir 2018), the DC Circuit explained that a communication with both legal and business purposes will be privileged so long as 'obtaining or providing legal advice was one of the significant purposes of the communications at issue.' Id. at 1268.

Application of legal professional privilege to former and prospective clients

The attorney-client privilege also protects communication with prospective clients and former clients. Under Rule 1.18, communication between a lawyer and a prospective client who does not retain the lawyer's services remains privileged. In these situations, lawyers should limit the information obtained during a preliminary interview to the information necessary to screen for conflicts. Under Rule 1.9, communication between a lawyer and a former client – arguably even one who is deceased – also remains privileged. The question of whether the legal professional privilege should survive a client's death is a debatable one. On the one hand, disclosure will not place the client in jeopardy; on the other hand, disclosure may call into question the former client's character.