Case 030361 & 030699. Request for records relating to the Review Group on Building Societies Legislation - records of Government - section 19(1)(b) - statement made at a meeting of Government - 19(2) - matter relating to the deliberative processes of a public body - section 20(1) - whether public interest better served by release - section 20(3) - whether disclosure would constitute a breach of a duty of confidence - section 26(1)(b) - whether commercially sensitive information - section 27(1)(b)

Case Summary

Facts

The requester sought access to records relating to the Review Committee on Building Societies Legislation, which was convened to examine certain issues regarding the Building Societies Act, 1989. Some information relating to the Review Group was public knowledge, but the records at issue outlined specific proposals for legislative change and included the views of the building societies on their respective competitive positions within the current legislative framework. The records also included information about the strategic intentions of the building societies in the event of legislative change. Evidence was presented to show that express assurances of confidentiality were sought by and given to the affected third parties with respect to the information supplied to the Review Group.

Decision

In light of the evidence that express assurances of confidentiality were sought by and given to the affected third parties, the Commissioner's authorised official was satisfied that the Department was under an obligation of confidence in relation to the confidential information supplied by the third parties. Considering the nature of the confidential information, the circumstances in which it was given to the Department, and the desire of the third parties that it remain confidential, he was also satisfied that disclosure would be an unauthorised use of the information to the detriment of the third parties. Accordingly, applying the relevant tests, he found that disclosure would constitute a breach of an equitable duty of confidence and was prohibited under section 26(1)(b).

Some of the records at issue included reference to an informal, unpublished Government decision that preceded the establishment of the Review Group. A copy of the Government decision, which was signed by the Secretary General to the Government, was found to be a record of the Government and therefore exempt under section 19(1)(b). Relying on section 19(2), the Department argued that the references to the Government decision were likewise exempt.

Section 19(2) provides for the protection of records containing the whole or part of a statement made at a meeting of the Government or information that reveals, or from which may be inferred, the substance of the whole or part of such a statement and is not a record by which a decision of the Government is published to the general public by or on behalf of the Government. The full text of the informal Government decision referred to a proposal in a Government Memorandum which formed the basis for a discussion at a Cabinet meeting. Two of the records concerned, on the other hand, included only a brief reference to the Government decision that was not derived from the Government Memorandum.

The Commissioner's authorised official observed that the Commissioner had stated in previous decisions that section 19(2) is concerned with the protection of Cabinet discussions. He also referred to the Cabinet Handbook, which states at paragraph 1.7, "Information concerning actualdiscussions(as distinct from decisions) at Government meetings is exempt from disclosure under the Act." He accepted that the full text of the Government decision contained information from which the substance of a statement made at a Cabinet meeting may be inferred and that section 19(2) therefore applied. However, he was not satisfied that section 19(2) applied to the records containing only a brief reference to the Government decision, because they did not reveal any information concerning the actual Cabinet discussion. As the records were internal memoranda, he found that section 19(1)(b) also did not apply.

The Department also claimed that section 20 applied to numerous records at issue. The Commissioner's authorised official accepted that the non-factual information in the records concerned related to the deliberative processes of the Department, namely, the decision of the Department, in consultation with other members of the Review Group, to make recommendations as to whether or not legislative change is warranted in relation to the Building Societies Act, 1989. As the deliberative process relating to the Building Societies legislation was still on-going, he did not believe that the public interest would be better served by granting access to the records, or parts thereof, which would prematurely reveal information of a sensitive and confidential nature about the recommendations made. However, other information in the records concerned was of an innocuous nature, consisting of general information relating to the Review Group and/or its members that was not of a confidential nature and other publicly available information, cover letters, and factual information. Section 20(1) does not apply to factual information, and the Commissioner's authorised official found that the remaining innocuous information should be released in the public interest as no harm would arise by reason of the release.

In addition, the Commissioner's authorised official noted that, while some of the information in the records at issue was commercially sensitive within the meaning of section 27(1)(b), all such information had already been found to be exempt under section 26(1)(b). As all of the information in the records at issue to which other exemptions did not apply was of an innocuous nature, he concluded that section 27(1) also did not apply.

The Commissioner's authorised official varied the decision of the Department.

Date of Decision: 25.08.2004

Our Reference: 030361 and 030699

25.08.2004

Mr. X

Dear Mr. X

I refer to your applications, dated 6 April 2003 (reference 030361) and 25 June 2003 (reference 030699), respectively, for review of the decisions of the Department of Environment, Heritage and Local Government on your request for access to all records relating to the Review Committee involving the "takeover protection" provisions of the Building Societies Act, 1989. I have been authorised by the Information Commissioner to conduct this review on her behalf. I apologise for the long delay in concluding this review.

Background

I have now completed my review of the Department's decisions. As you previously have been advised, this review has been carried out in accordance with the provisions of the Freedom of Information (FOI) Act, 1997, as amended by the Freedom of Information (Amendment) Act, 2003. Accordingly, all references in this letter to particular sections of the FOI Act, except where otherwise stated, refer to the 1997 FOI Act as amended. In carrying out my review, I have had regard to your submission dated 4 June 2003, which restated the arguments made in your application for review, your telephone conversations with Ms. Melanie Campbell, Investigator, and to the submissions made to this Office by the Department and the affected third parties. I have also examined the records at issue, which I will refer to by using the numbering system adopted by the Department on the schedule of records made available to you.

I note that, on 8 July 1994, Ms. Campbell wrote to you to explain her preliminary view on the matter. You were given a period of three weeks in which to reply. As no reply from you has been received, I have proceeded to a decision on the basis of the information now before me.

Scope of Review

As you know, the Department previously granted access in full to two records, granted partial access to a further seven records, and refused access in full to 36 records. However, during the course of this review, the Department has agreed to the release of additional records, namely, column 1 of record number 16; page 1 of record number 26; record number 27; pages 2 and 3 of record number 30; record number 32; record number 34, apart from section 3; the cover page to record number 38; and also part of record number 44. Accordingly, this review is now concerned solely with the question of whether the Department's refusal to grant you access to the following records, or parts thereof, is justified:

• Records subject to the section 29 notification procedure
• Number 1, 5, 7, 16, 28, 29, 34, 38 (in part)
• Number 3, 4, 9, 10, 11, 12, 13, 14, 15, 17, 18, 19, 20, 33, 35, 36, 37, 39, 40, 43 (in full)
• Other records
• Number 26, 30, 44 (in part)
• Number 2, 6, 21, 22, 23, 24, 25, 41, 42, 45 (in full).

Findings

Records Subject to the Section 29 Notification Procedure

The Relevant Circumstances

Ms. Campbell set out the relevant circumstances underlying your FOI request in her preliminary view letters to you and the Department. However, as this decision will be notified to the affected third parties in accordance with section 34(10) of the FOI Act, I consider it useful to restate the relevant circumstances here.

The Review Group on Building Societies Legislation was convened to examine certain issues regarding the Building Societies Act, 1989. The issues arose during the drafting of the Housing Miscellaneous Provisions Act, 2002 and concern the protective provisions contained in sections 101 and 102 of the 1989 Building Societies Act. The protective provisions prevent any one person or institution from holding more than 15 percent of the shares in a building society for five years after conversion to a PLC. Following its examination of the relevant issues, the Review Group was to draw conclusions and make recommendations as to whether or not legislative change is warranted. According to the Department, the Review Group delivered its report to Government in July 2003, but the matter remains under consideration.

Some information relating to the Review Group is public knowledge. For instance, it is well known that Irish Nationwide has sought changes to the legislation that would facilitate demutualisation, whereas the EBS favours enabling legislation that would allow it to operate along lines similar to continental co-operative mutuals. However, the records at issue outline specific proposals for legislative change and include the views of the building societies on their respective competitive positions within the current legislative framework. The records also include information about the strategic intentions of the building societies in the event of legislative change. The Department has presented evidence to show that express assurances of confidentiality were sought by and given to the affected third parties in this case with respect to the information supplied to the Review Group. The evidence consists of correspondence between the Department and the affected third parties as well as the minutes of the second meeting of the Review Group, which was held on 11 November 2002. It is argued that the Department owes the affected third parties a duty of confidence.

Record number 17 - Section 22(1)(a)

As you have been advised, the Department has also made a claim of legal professional privilege under section 22(1)(a) of the FOI Act with respect to record number 17. For the reasons stated in Ms. Campbell's preliminary view letter, I am satisfied that the Department's claim under section 22(1)(a) is justified, and I consider it unnecessary for me to address any of the other claims for exemption made by the Department in relation to record number 17.

Information Obtained in Confidence

Section 26(1)(a) and 26(1)(b) of the FOI Act provide protection for information obtained in confidence by public bodies. Section 26(1)(b) provides that a public body shall refuse access to a record if disclosure of the information concerned would constitute a breach of a duty of confidence provided for by a provision of an agreement or enactment or otherwise by law. The correct tests to apply in deciding whether there is a breach of an equitable duty of confidence are set out in the case of Coco v. A. N. Clark (Engineers) Limited F.S. R. 415 (which is accepted as reflecting the Irish law on the subject - see, for example, House of Spring Gardens Limited v. Point Blank Limited [1984] I.R 611). The tests require that: (1) the information has the necessary quality of confidence about it; (2) the information was imparted in circumstances imposing an obligation of confidence; (3) there is an unauthorised use of that information to the detriment of the party communicating it.

The Commissioner interprets the term "confidence" for the purposes of sections 26(1)(a) and (b) by reference to the following definition, which is derived from the law relating to a breach of a duty of confidence: "A confidence is formed whenever one party ('the confider') imparts to another ('the confidant') private or secret matters on the express or implied understanding that the communication is for a restricted purpose." ("B" v. Brisbane North Regional Health Authority, (1994) 1 QAR 279, at paragraph 45, quoting from F. Gurry "Breach of Confidence" in P. Finn (Ed.) Essays in Equity; Law Book Company, 1985, p.111.). Based on this definition, the Commissioner considers that, first, information given in confidence is concerned with private or secret matters rather than information which is trite or which is already in the public domain, i.e. that it is necessary to establish that the information has the necessary quality of confidence. Second, the communication must be for a restricted or limited purpose. Third, there must be an understanding that the information is being communicated for a restricted purpose.

I find that the following records, or parts thereof, contain information supplied by third parties that has the necessary quality of confidence for the purposes of section 26(1):

• record number 1, sections 4, 5, and 6
• record number 3 (in full)
• record number 4 (in full)
• record number 5, sections 4, 5, 6, and 9
• record number 9, page 4 (the letter from ICS Building Society to the Review Group)
• record number 10, pages 2 to 6
• record number 11, pages 2 to 17 (including the appendix)
• record number 12 (in full)
• record number 13 (in full)
• record number 14 (in full)
• record number 15, second paragraph of section 1 and all of section 4
• record number 16, columns 2 and 3 (summarising the proposals)
• record number 18 (in full)
• record number 19 (in full)
• record number 28, sections 5 and 8
• record number 29, sections 5 and 7
• record number 34, section 3.

In light of the evidence that express assurances of confidentiality were sought by and given to the affected third parties in this case, I am satisfied that the Department is under an obligation of confidence in relation to the confidential information in these records. The submissions made by the third parties, particularly the building societies, make it clear that they do not want their confidential information to be disclosed under the FOI Act. In the circumstances, I accept that such disclosure would be an unauthorised use of the information.

In considering whether detriment can be said to occur to the third parties, I note that it is not difficult to establish this element of the third "Coco" test. As the Queensland Information Commissioner observed at paragraph 111 of the Brisbane decision, which is referenced above:

"It appears , however that detriment is fairly easily established. In particular, it is not necessary to establish that threatened disclosure will cause detriment in a pecuniary sense: 'detriment can be as ephemeral as embarassment...loss of privacy or fear...'. Moreover in Attorney-General v Guardian Newspapers, Lord Keith of Kinkel said : 'I would think it is sufficient detriment to the confider that information given in confidence is to be disclosed to persons to whom he would prefer not to know of it, even though the disclosure would not be harmful to him in any positive way.'"

In light of the nature of the confidential information, the circumstances in which it was given to the Department, and the desire of the third parties that it remain confidential, I am satisfied that disclosure would be to the detriment of the third parties. Accordingly, applying the tests set out in Coco v. A. N. Clark (Engineers) Limited F.S. R. 415, which are outlined above, I find that disclosure would constitute a breach of an equitable duty of confidence and, subject to public interest considerations, is prohibited under section 26(1)(b) of the FOI Act.

Section 26(3) provides for a public interest test in relation to section 26(1)(a), but is not applicable to section 26(1)(b). Nevertheless, although not stated in the FOI Act, it is well established that there are certain limited circumstances where the duty of confidence may be breached in the public interest, for example, to reveal crimes, wrongdoing or danger to the public. In my view, no such a situation exists in this case. I conclude that section 26(1)(b) applies to the records, or parts thereof, identified above as containing confidential information supplied by third parties.

However, the supplier of the information at issue in record number 7 has confirmed that he has no objection to the full release of this record. In addition, I consider that the information in the remaining records, or parts thereof, is not of confidential nature or was not supplied by third parties. I note, for instance, that the information in these records relating to the third parties that the Department seeks to withhold on the basis of section 26 is too general in nature to have the necessary quality of confidence. Accordingly, I find that sections 26(1)(a) and (b) do not apply.

Section 19

Records number 1, 5, 28, 29, 40, and 43 include reference to the informal Government decision made on 7 March 2002 that preceded the establishment of the Review Group. The Department states that the Government decision has not been published and argues that section 19(2)(a) of the FOI Act applies.

Section 19(2) provides for the protection of records containing the whole or part of a statement made at a meeting of the Government or information that reveals, or from which may be inferred, the substance of the whole or part of such a statement and is not a record by which a decision of the Government is published to the general public by or on behalf of the Government. The Commissioner has stated in previous decisions that this provision is concerned with the protection of Cabinet discussions. The Commissioner's view is supported by reference to the Cabinet Handbook, which states at paragraph 1.7, "Information concerning actualdiscussions(as distinct from decisions) at Government meetings is exempt from disclosure under the Act." Moreover, in an unpublished decision in Case Number 030414 in which the Department was a party, the Commissioner found that none of the exemptions contained in section 19 applied to a letter from the Department to the Director General of the Attorney General's Office, although part of the letter gave a general indication of the contents of a Government decision.

However, the full text of the informal Government decision included in records number 1, 5, 28, and 29 refers to a proposal in a Government Memorandum, which formed the basis for a discussion of the Cabinet at the meeting held on 7 March 2002. For this reason, I accept that the full text of the Government decision in these records contains information from which the substance of a statement made at a Cabinet meeting may be inferred, and I find that section 19(2)(a) applies. Records number 40 and 43, on the other hand, include only a brief reference to the Government decision that is not derived from the Government Memorandum and does not reveal any information concerning the actual Cabinet discussion. Accordingly, I am not satisfied that the section 19(2) applies to records number 40 and 43. For the sake of completeness, I also note that, as the records number 40 and 43 are internal memoranda, section 19(1)(b) also does not apply.

Section 20

The Department claims that section 20 applies to records number 1, 3, 4, 5, 15, 16, 17, 18, 19, 20, 28, 29, 33, 34, 35, 36, 37, 38, 39, 40, and 43. Section 20(1) of the FOI Act allows a public body to refuse to grant a request if the contents of the record concerned relate to the deliberative processes of a public body. Deliberative processes involve the consideration of various matters with a view to making a decision on a particular matter. Section 20(2)(b) of the FOI Act excludes factual information from exemption under section 20(1). In addition, section 20(3) provides that section 20(1) "does not apply in relation to a case in which, in the opinion of the head concerned, the public interest would, on balance, be better served by granting than by refusing to grant the request."

I have already found that sections 19(2)(a), 22(1)(a), and 26(1)(b) apply to some of the records concerned, or parts thereof, and need not consider whether they are also exempt under section 20(1).

I accept that the non-factual information in the records concerned relates to the deliberative processes of the Department, namely, the decision of the Department, in consultation with other members of the Review Group, to make recommendations as to whether or not legislative change is warranted in relation to the Building Societies Act, 1989. Although the Review Group has delivered its report to the Government, the deliberative processes relating to Building Societies legislation are still on-going.

Moreover, I find that the release of the following records, or parts thereof, would prematurely reveal information of a sensitive and confidential nature about the recommendations made:

• record number 20 (in full)
• record number 29, section 6
• record number 33, sections 3 and 4
• record number 35 (in full)
• record number 36 (in full)
• record number 37 (in full)
• record number 38 (except for the cover page)
• record number 39 (in full)
• record number 40, section 2, paragraphs 3 to end
• record number 43, section 2, paragraphs 3 to end.

In the circumstances, I do not believe that the public interest would be better served by granting access to these records. Accordingly, I am satisfied that section 20(1) applies.

However, the remaining information in the records concerned, apart from the information that I consider to be exempt under sections 19(2)(a), 22(1)(a), and 26(1)(b), is of an innocuous nature, consisting of general information relating to the Review Group and/or its members that is not of a confidential nature and other publicly available information, cover letters, and factual information. This information includes a potential plan of action that the Department seeks to withhold, but the plan of action is now historic, unexceptional in terms of the steps outlined, and does not reveal any of the specific proposals made or any other sensitive information. I also note that the additional information that the Department seeks to withhold from section 2 of records number 40 and 43 reveals nothing that cannot be discerned from the Department's press release on 16 December 2003 and other published reports relating to the review of the building societies legislation. Section 20(1) does not apply to the factual information, and I find that the remaining innocuous information should be released in the public interest as no harm would arise by reason of the release.

Section 27

Section 27 of the FOI Act provides protection for three different classes of commercially sensitive information as follows:

As noted above, the records at issue include the views of the building societies on their own strengths and weaknesses within the current legislative framework and also information about the strategic intentions of the building societies in the event of legislative change. I accept that the release of this type of information could reasonably be expected to result in a material financial loss or gain to the building societies or could prejudice their competitive positions and is therefore commercially sensitive within the meaning of section 27(1)(b). However, I have already found that all such information is exempt under section 26(1)(b). As noted above, the information in the records at issue that I do not consider to be exempt under section 19(2)(a), section 22(1)(a), section 26(1)(b), or section 20 is of an innocuous nature, consisting of general information relating to the Review Group and/or its members that is not of a confidential nature and other publicly available information, cover letters, and factual background material. In the circumstances, I conclude that section 27(1) does not apply.

Other Records

Record number 6 - Section 19(1)(b)

Record number 6 is a copy of the Government decision referred to above. I find that record number 6, which was signed by the Secretary General to the Government, is a record of the Government and is exempt under section 19(1)(b) of the FOI Act.

Section 20

Turning lastly to the question of whether section 20(1) applies to the remaining records at issue, I note that the following consist of factual information:

• record number 2, background section
• record number 45, page 1 and attachment to the emails setting out an unofficial consolidation of the current provisions of the Central Bank Act.

Accordingly, section 20(1) does not apply (section 20(2)(b) refers). I am satisfied that the remaining records or parts thereof fall within the ambit of section 20(1). Moreover, as disclosure would prematurely reveal information of a sensitive and confidential nature about the recommendations made by the Review Group to the Government, I find that the public interest would be better served by refusing access to the following records or parts thereof:

• record number 2, apart from the background section
• record number 21 (in full)
• record number 22 (in full)
• record number 23 (in full)
• record number 24 (in full)
• record number 25 (in full)
• record number 26, pages 2 and 3
• record number 30, page 1
• record number 42 (in full)
• record number 44, page 1 and bottom of page 2 to end of document ("Section . . .mortgage lenders?]")
• record number 45, pages 2 to 5.

However, the remaining record at issue, number 41, is simply a table setting out a timeframe for action. While the Department continues generally to oppose the release of this record, it has not identified any sensitive or confidential therein. In the circumstances, I find no basis for protecting the record in the public interest and I conclude that section 20(1) does not apply.

For your convenience, I enclose a chart summarising the outcome of this review.

Decision

Having carried out a review under section 34(2) of the FOI Act, I hereby vary the decision of the Department as described above.

A party to a review, or any other person affected by a decision of the Information Commissioner following a review, may appeal to the High Court on a point of law arising from the decision. Such an appeal must be initiated not later than eight weeks from the date of this letter.

Yours sincerely

Senior Investigator