Case 050319. Request for access to records concerning the decision to downgrade four five-star hotels - whether the records contain information imparted in confidence - section 26 - whether they contain commercially sensitive information - section 27 - whether the public interest warrants their release - section 27(3).

Case Summary

Facts

The requester sought all records concerning the downgrading of four hotels from five-star status to four-star status. The relevant legislation requires that hotels be registered with Fáilte Ireland, but neither requires that they partake in a classification scheme nor sets out standards for hotels. A voluntary classification system was established in 1993.

At the time of the Commissioner's decision, the records at issue comprised of information pertaining to the hotels (inspection reports and related records) and records containing the hotels' views as to the contractor (Excellence in Tourism, or "EIT" for the purposes of the Commissioner's decision) that had conducted the grading process on behalf of Fáilte Ireland. The provisions relied on by Fáilte Ireland were sections 26 and 27 of the FOI Act.

Findings

The Commissioner did not accept that section 26 applied to the majority of the records. She accepted that it applied to one record, and to elements of two further records.

She accepted that the records pertaining to the inspections of the hotels qualified for exemption under section 27(1)(b), even though they dated back to 2003 and 2004. In considering the public interest, the Commissioner distinguished between the inspection of hotels for the purpose of being classified under a voluntary system and the mandatory inspection of hotel kitchens for the purpose of food hygiene legislation. She did not find that the public interest warranted the release of the records concerned.

The Commissioner also accepted that section 27(1)(b) applied to records concerning comments made by the hotels about the contractor. In general terms, she said she considered that records showing how the hotels were subsequently reinstated at five-star status following an appeal to Fáilte Ireland should be in the public domain. She noted that records released by Fáilte Ireland during the course of this review disclose how the decision concerned was reached. She did not consider that additional understanding of the appeals process would be gained by the release of the very specific, particular comments about EIT that are contained in the records, and so she found that the public interest did not warrant the release of the records concerned.

Date of Decision: 09.05.2007

Our Reference: 050319

09.05.2007

Mr John Burns The Sunday Times

Dear Mr Burns

I refer to your application to this Office under the Freedom of Information Act, 1997 (the FOI Act) for a review of the decision of Failte Ireland on your undated request for access to "all records concerning the recent demotion of four hotels from four star status, and their subsequent appeal against this decision."

Please accept my apologies for the delay that has arisen in dealing with your application. This has been due to a back log of cases that arose from staff shortages in the early days of the Office. As the Office was dealing with a number of complex cases in which the applications were made before yours, we were unable to complete your application until now.

Background

As stated, your undated request sought access to "all records concerning the recent demotion of four hotels from four star status, and their subsequent appeal against this decision." Failte Ireland accepts that the reference to the demotion of hotels with four star status was intended to refer to those with five star status. On 7 February 2005, Fáilte Ireland told you it was refusing your request, of which you subsequently sought an internal review. On 29 September 2005, Fáilte Ireland issued its internal review decision, which told you that it was partially releasing the records it considered relevant to your request. On 11 October 2005, you made your appeal to this Office.

In conducting this review, I have had regard to correspondence between Ms Anne Moran, Investigator in this Office, and Fáilte Ireland, to correspondence between Ms Moran and the hotels concerned, and to correspondence between Ms Moran and Excellence in Tourism Ltd (EIT), which was under contract to Fáilte Ireland to conduct inspections on the latter's behalf under the then non-mandatory star classification system for hotels and guesthouses. The Irish Hotels Federation (the IHF) also sought to have its views recorded, and I have had regard to its comments. I have had regard to your application to this Office and to the details of a recent conversation you had with Ms Moran. I have examined copies of the records at issue, which were sent to my Office for inspection. Finally, I have conducted this review in accordance with the provisions of the Freedom of Information (FOI) Act, 1997, as amended by the Freedom of Information (Amendment) Act, 2003. All references in this letter to particular sections of the FOI Act refer to the FOI Act, 1997 as amended.

Scope of Review

I will firstly set out the extent to which Fáilte Ireland holds records of relevance to your request. I will then set out those records that have been released (which I note reveal the identities of the hotels concerned), including those which were released during the course of this review. Such records are, therefore, not covered by the scope of my review. Finally, I set out the withheld records that are covered by the scope of my review:

• A Hotel File: 16 relevant records, of which records 1-9 were released in full and records 10-16 released in part. Thus, the remainder of records 10-16 are covered by the scope of my review.
• B Hotel File: 19 relevant records, of which records 1-5 and 7 have been released and records 6, 8-10, 13-19 have been partially released. Thus, records 11 and 12 (withheld in full) and the remainder of records 6 and 8-19 are covered by the scope of my view;
• C Hotel file: 27 relevant records, of which records 1, 2, 4, 6-8 and 24 to 26 have been released in full and records 3, 5, 10-14, 18-20 and 27 were released in part. Thus records 9, 15-17, 21-26 and the remainder of records 3, 5, 10-14, 18-20 and 27 will be covered by the scope of my review.

I note that the schedule sent to you in April 2007 refers to 36 records being relevant to the scope of your request, while only 27 records were deemed relevant at decision making stage. Copies of the 27 records were sent to my Office upon acceptance of your appeal. Upon receipt of the April 2007 schedule, Ms Moran requested copies of the further nine records, which were provided and which have been examined.

Fáilte Ireland now submits that it was an error on its part to refer to records 28-36 in the April 2007 as they were not relevant to your request. I have examined the records concerned (all of which date from 1999 - 2001 and concern the initial classification of the hotel) and am satisfied that this is the case. Accordingly, I am ruling them outside the scope of my review and will not consider the exemptions relied on in respect of them.

• D Hotel File: 39 relevant records, of which records 3, 4, 12, 17a, 21, 22, 24-26, 35 and 38 have been released in full and records 27, 28, 30-34, 36, 37 and 39 have been partially released.

Fáilte Ireland also supplied me with a copy of a record (and various attachments), referred to in record 1 of this file, which it appears not to have been considered in its decision making process. Any further reference to record 1 on the D Hotel file is, therefore, intended to refer to both the record considered by the Board in its decision making process to date, as well as the further record and attachments.

Fáilte Ireland, through an oversight, did not release to you record 17 on this file (a fax cover sheet). It has undertaken to release the record to you immediately. Accordingly, there is no need for me to consider this record further. The records on this file covered by the scope of my review are those withheld in full (records 1, 2, 5-11, 13-16, 18-20 and 23) and those withheld in part (records 27-34, 36, 37 and 39).

Where necessary, I will refer the D Hotel file, the C Hotel file, the A Hotel file and the B Hotel file as "the Hotels Files".

• Classification Appeals Board (CAB) File: 16 relevant records, of which 14 records have been released and of which the remaining two (record 5 and record 7) have been partially released.

Record 7 comprises two letters from EIT to the CAB of 11 November 2004 (one concerning the appeal by the D, which has been partially released to you, and the other referring generally to all the appeals submitted to the CAB, which has been released in full to you). I will refer to the letter of 11 November 2004 that has been partially released as record 7a.

There is an attachment to the other letter of 11 November 2004, comprised of various documentation supplied by EIT to the CAB for the purpose of the appeal. The attachment includes copies of various records that are already on the Hotels Files, and which have either been released to you or are considered later in this letter. I intend not to deal further with any copies of such records that are contained in this attachment.

The attachment also contains a number of records that are not on the Hotels Files, some of which have been released to you during this review. I do not intend to deal further with such records. Those not released to you to date, and which are covered by the scope of my review, are as follows:

• Refurbishment figures for one of the hotels (withheld in full, which I will designate as record 7b);
• Letter of 12 February 2004 from the D Hotel to EIT (withheld in part, now designated as record 7c);
• Inspection Report of the C Hotel (withheld in part, now designated as record 7d);
• Letter from the C Hotel to EIT of 6 August 2004 (withheld in part, now designated as record 7e);
• Letter from the C Hotel to EIT 29 July 2004 (withheld in full, now designated as record 7f);
• Letter from the C Hotel to EIT 21 June 2004 (withheld in part, now designated as record 7g).

The Classification System

Fáilte Ireland is responsible for ensuring that hotels meet registration criteria under the Tourist Traffic Acts, 1939-1988. I understand that, at the time of your request, Fáilte Ireland, in consultation with the Irish Hotels Federation, also operated a non-mandatory star classification system for hotels and guesthouses, which gave such establishments the right to opt in or out of the system. At the time of your request, the operation of the inspections, registrations and classification system was conducted on behalf of Fáilte Ireland by EIT. I understand that the voluntary system is currently being replaced with a mandatory classification system.

Those records released to you by Fáilte Ireland under the FOI Act show that EIT, on behalf of Fáilte Ireland, ultimately deemed that the Hotels should be reclassified as four star; that there was various correspondence between the hotels and EIT on foot of this; the hotels appealed the decisions to reclassify to Fáilte Ireland; that the CAB was set up, considered their appeals and upheld them; and that the hotels continued to be classified as five star accordingly (or in the case of the Shelbourne, that it withdrew its appeal and sought to be "un-classified" pending completion of its restoration project). The records released to you from the CAB file show the reasons why the latter upheld the appeals.

Findings

In its submissions to this Office, Fáilte Ireland relied on a number of exemptions in the FOI Act in support of its position that the records at issue should not be released to you - namely section 21(1)(a), 27 (in respect of which it did not refer to whether section 27(1)(a), (b) or (c) was relevant), 26(1)(a), 26(1)(b), 22(1)(a), 23(1)(a)(ii), 23(1)(a)(iv), 30, 31(1)(a), 31(2)(l), 31(2)(m), 31(2)(n) and 31(2)(o). As you will have noted from the schedules supplied to you by Fáilte Ireland, section 22(1)(a) was relied on in respect of certain records concerning the D Hotel.

Firstly, I note that one record (the first line of record 15 on the A Hotel file) refers to staff members of the hotel. I am satisfied that to direct the release of this excerpt would disclose personal information about the persons concerned, and that there is no public interest in its release. Accordingly, I am satisfied that the excerpt should be withheld from release under section 28(1) of the FOI Act, which provides for the refusal of a request for access to a record where its release would disclose personal information.

Section 22(1)(a)

Section 22(1)(a) provides that a request for a record shall be refused if it "would be exempt from production in proceedings in a court on the ground of legal professional privilege".

I accept that legal professional privilege enables the client (in other words, Failte Ireland in this case) to maintain the confidentiality of two types of communication:

• confidential communications made between the client and his/her professional legal adviser for the purpose of obtaining and/or giving legal advice, and
• confidential communications made between the client and a professional legal adviser or the legal adviser and a third party or between the client and a third party, the dominant purpose of which is preparation for contemplated/pending litigation.

Section 22(1)(a) does not require any consideration of the public interest.

I consider that a number of records on the D Hotel file may be withheld on the grounds that section 22(1)(a) applies to them. The records consist of communications between Failte Ireland and its legal advisors, between Failte Ireland's legal advisors and those of the D Hotel, between Failte Ireland's legal advisors and EIT, and between Failte Ireland and the D Hotel and/or its legal advisors. I am satisfied that litigation was contemplated by the D as at the first instance that its solicitors became involved in dealing with Failte Ireland and that accordingly, this was why the records concerned came into existence. Accordingly, I consider that the second limb of legal professional privilege, and thus, section 22(1)(a), applies to the following records on the D Hotel file:

Records 1; 2; 5; 6; 7; 8; 9; 10; 11; 13; 14; 15; 16; 18; 19; 20; 23.

While legal professional privilege resides with the client, Fáilte Ireland is not willing to waive such privilege. As there is no public interest test required to be considered in respect of records to which section 22(1)(a) has been found to apply, I consider that these records have been properly withheld from you in accordance with the FOI Act.

It seems to me that the remaining records can be classified into two categories:

(i) Inspection reports and other reports containing information provided by the hotels to the inspectors regarding future plans;

(ii) Correspondence concerning the manner in which EIT conducted the assessment process.

Section 26

Section 26(1)(a) provides that a record shall not be released pursuant to the FOI Act where record containing the information was:

• given to the public body concerned in confidence and,
• on the understanding that it would be treated by it as confidential and,
• its disclosure would be likely to prejudice the giving to the body of further similar information from the same person or other persons and,
• it is of importance to the body that such further similar information as aforesaid should continue to be given to the body.

Section 26(1)(b) provides that a request for access to a record shall be refused "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".

Section 26(2) provides that: " [s]ubsection (1) shall not apply to a record which is prepared by a head or any other person (being a director, or member of the staff of, a public body or a person who is providing a service for a public body under a contract for services) in the course of the performance of his or her functions unless disclosure of the information concerned would constitute a breach of a duty of confidence that is provided for by an agreement or statute or otherwise by law and is owed to a person other than a public body or head or a director, or member of the staff of, a public body or a person who is providing or provided a service for a public body under a contract for services."

Section 26(3) requires that the public interest must be considered where section 26(1)(a) has been found to apply to a record i.e. whether the public interest would on balance be better served by granting than by refusing the request. Section 26(1)(b), however, does not require the consideration of the public interest - therefore, should a record be found to be exempt under that provision, it cannot fall to be released.

According to the above, section 26(1) cannot apply to any record created by a staff member of Failte Ireland, or one created by an entity contracted to Failte Ireland, unless disclosure of the information concerned would constitute a breach of a duty of confidence that is provided for by an agreement or statute or otherwise by law and is owed to the hotels.

Both Fáilte Ireland and the hotels argue that there was an understanding that any information gathered in the ratings inspection process would remain confidential, with only the ultimate ratings of the hotels being made public.

I am not aware of, nor has evidence been provided to me of, any agreement or statute that provided for such confidentiality. However, I must consider whether there is a duty of confidence provided for "otherwise by law" - in other words, whether there is an equitable duty of confidence between the hotels and Failte Ireland in respect of the information at issue.

In order for an equitable duty of confidence to exist, this Office considers that three conditions must be met, viz.

• the information contained in the record must have the necessary quality of confidence about it and
• that information must have been imparted in circumstances imposing an obligation of confidence and
• there must be an unauthorised use of that information to the detriment of the party communicating it.

The Office also has adopted the following definition of "confidence" taken from F. Gurry "Breach of Confidence" in Essays in Equity; P. Finn (Ed.); Law Book Company, 1985, (p.111):

"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." (please see case No. 98179 - Mr Michael Grange and the Department of Enterprise, Trade and Employment).

The inspection reports were prepared by staff members of EIT who were performing the inspections in the course of their functions. The reports consist of the author's observations and opinions in respect of the facilities in the hotels. While Fáilte Ireland contends that "the totality of the information which came into the hands of Fáilte Ireland was much wider than would necessarily have been gleaned by any one visitor or on any one occasion", the fact remains that the records concerned do not contain any information that was imparted to an inspector. I find, accordingly, that a confidence was not formed between the hotels and EIT in respect of the information contained in the inspection reports. Thus, section 26(1)(b) does not apply to these records.

Some of the records comprise letters from the hotels to EIT in respect of issues raised in the inspection reports. In so far as they contain details of the steps the hotels intend to take to deal with the issues raised by the inspectors in their inspections, I can accept that they can be described as "imparting" information. However, I am not of the view that the information concerned amounts to secret or private matters. As noted, the information concerned is of a nature that impacts on the rating ultimately awarded to the hotels. I consider that "secret or private" information in this context amounts to details provided by the hotels that goes beyond their responses as to how they intend to take action on foot of the findings of the inspectors, such as a breakdown of the proposed expenditure that might be incurred in taking such action. In my view, information as to the steps to be taken by hotels in dealing with the issues raised by the inspectors does not amount to "private or secret" information, and section 26(1)(b) does not apply to these records.

There are three records on file that I consider to contain such "private or secret information", namely record 7b on the CAB file, and the last sentence of the second paragraph on records 8 and 9 on the B Hotel file. I accept that there was an understanding of confidence in respect of such information between the hotels and EIT, and I also accept that to release the information would amount to an unauthorised use of that information. I also accept, even though the detail concerned is somewhat aged, that to release the information concerned would be to the detriment of the party communicating it. Accordingly, I find that there is an equitable duty of confidence between Fáilte Ireland and the hotels in respect of this information and that section 26(1)(b) applies to these records. There is no public interest test to be considered in respect of records that are found to be exempt under section 26(1)(b) and so, I find these records to be exempt from release to you.

Section 27(1)

Leaving aside those records which I have found to be exempt as set out above, the remaining records are comprised of information gathered on foot of inspections of the hotels by EIT further to the star rating assessment process and information provided by the hotels to EIT as to how they intend to take action in respect of the specific results of the inspections. They also comprise correspondence between the hotels and EIT, or between the hotels and Fáilte Ireland, as to how the hotels perceive EIT to have conducted the functions assigned to it by Fáilte Ireland.

Section 27 is the most appropriate provision to consider in respect of such information, in my view.

Section 27(1) of the FOI Act provides that, subject to subsection (2), a head shall refuse to grant a request for a record if the record concerned contains

"(a) trade secrets of a person other than the requester concerned,

(b) financial, commercial, scientific or technical or other information whose disclosure could reasonably be expected to result in a material financial loss or gain to the person to whom the information relates, or could prejudice the competitive position of that person in the conduct of his or her profession or business or otherwise in his or her occupation, or

(c) information whose disclosure could prejudice the conduct or outcome of contractual or other negotiations of the person to whom the information relates."

A record found to be exempt under section 27(1) may be released if the public interest in its release outweighs the public interest in it being withheld (section 27(3)).

Section 27 and information pertaining to the hotels

I do not accept that section 27(1)(a) applies to such information, in that I do not accept that the records contain the trade secrets of the hotels. Nor do I accept that section 27(1)(c) applies to this information, in that it has not been demonstrated to me that there are any contractual or other negotiations in train in the hotels that might be affected by the release of the records.

However, I accept that section 27(1)(b) applies to records concerning results of the inspections of the hotels as contained in the inspection reports, or as contained in correspondence from the hotels that refer to such inspections. As set out earlier, section 27(1)(b) protects information whose disclosure:

• could reasonably be expected to result in material financial loss or gain to the person to whom the information relates, or
• could prejudice the competitive position of the person in the conduct of his or her profession or business or otherwise in his or her occupation.

The essence of the test in section 27(1)(b) is not the nature of the information but the nature of the harm which might be occasioned by its release. Furthermore, the word "could" in the provision allows for more generous latitude in refusing to grant access on the ground of perceived harm than the word "would". In relation to the second bullet point above, it should be noted that this part of section 27(1)(b) can apply even where such harm is not certain to materialise but might do so. However, in invoking the phrase "prejudice", the damage likely to occur as a result of disclosure of the information sought must be specified with a reasonable degree of clarity.

The records contain (or refer to) general observations on such matters as the experience of the inspector at reception in the hotels, the decor of the rooms, or the presentation of particular dishes. I have considered whether it could be argued that this information is of a type that could have been observed by anyone who stays in the hotels concerned, and thus whether any harm could be caused by its release. I have also considered the fact that the records date back to 2003 and 2004. You have commented that information concerning faults observed so long ago cannot be commercially sensitive today.

It has been put to me that the views of a trained assessor, carrying out an analysis of the hotels' operations pursuant to the classification system, are likely to be far more prejudicial to the hotels' reputations that any views that might be expressed by a casual resident thereof. This is a reasonable proposition. I accept that the hotels operate in a highly competitive environment, in which the reputation of each hotel is of immense importance. Given that the inspectors' findings result in the acquisition or retention of particular ratings, I accept that a certain amount of harm could be caused to the hotels' reputations by the release of such findings.

Although the information in the records dates back to 2003 and 2004, it seems a reasonable proposition that the hotels' competitors could use the information in the records at issue to their advantage today. Accordingly, I accept that, despite their age, the release of the records could still impact on the hotels' reputations today.

An issue that developed since your application was received was the sale of the B hotel. However, [name of parent Group] has argued that adverse comment about its B hotel could impact on the competitive position of other hotels within the Group. I accept this argument.

Accordingly, I accept that section 27(1)(b) applies to the such information on the hotels files.

Public interest

Section 27(3) requires me to consider the public interest in release of records which have been found to be exempt under section 27(1). Your application to this Office of 11 October 2005 said that there was a public interest in knowing how Failte Ireland operates its star system for hotels. You also said that there is a public interest in knowing how it operates its appeals process, and in why hotels that were stripped of their five star status were subsequently reinstated.

While the records released to you indicate that the manner in which the appeals procedures operated by EIT were not as agreed, Failte Ireland has confirmed to my Office that the inspections conducted of the hotels were in the format approved by it. Accordingly, there is no public interest in protecting the content of the records on the grounds that the information therein was derived from an unapproved inspection process.

Firstly, I consider the public interest in knowing how Fáilte Ireland operates its star rating system for hotels to have been met by the public availability of Fáilte Ireland's document "Classification System for Hotels in Ireland", which sets out the criteria to be applied to hotels seeking to retain or attain a particular star rating, further to the voluntary system that was in situ at the time of the downgradings. I do not consider that the release of these records would further serve this public interest.

Your next argument is that there is a public interest in ensuring the transparency of the appeals process, particularly in respect of why the star ratings were subsequently reinstated. In my view, this public interest has been served adequately by the records released to you to date, particularly those on the CAB file, which show how the appeals were processed and why the ratings were reinstated. The records I am considering here do not contain information concerning either the appeals process itself or concerning why the five star ratings were reinstated. I do not consider that the release of the records would serve further this public interest, accordingly.

A separate argument can be made that there is a public interest in revealing how Fáilte Ireland monitored EIT in respect of the functions it was performing on its behalf. As the records at issue do not contain any information in this regard, I consider that this public interest would not be served by their release.

In your recent submissions (by telephone and email), you said that, while the records released to you showed how the star ratings were reinstated, the awarding of a particular star ranking dictates the prices that hotels charge the public for their services, and thus there was a public interest in revealing the results of the inspections and knowing why the hotels were deemed to have lost their five star status. You say that, while the public is not obliged to give their custom to a particular hotel, the hotels generally charge higher prices using the justification of a star rating that is ratified and underpinned by a state agency, Fáilte Ireland. I take from this an argument that, as the hotels referred to in this case had decided to take part in the voluntary scheme, and thus derive particular benefits from it (through the awarding of a Failte Ireland-sanctioned rating) that they should also expect that information concerning the awarding of those ratings would be subject to public scrutiny.

In attempting to strike the balance between openness on the one hand, and the need to protect commercially sensitive information on the other, I think that it is legitimate to consider two things. In relation to these records, I must consider the positive public interest which is served by disclosure and the second is the harm that might be caused by disclosure.

I have made findings in other cases that resulted in the release of inspection reports of food premises, crèches and private nursing homes. Those entities, however, are obliged under law to meet particular standards, which in turn the Health Service Executive is required to enforce.

On the other hand, while I understand that the Tourism Traffic Act, 1939 requires that hotels must be registered with Fáilte Ireland, and provides for the inspection of registered premises, it neither requires that hotels partake in a classification scheme, nor sets out standards that hotels must meet. In respect of classifications, the Tourism Traffic Act merely provides that Fáilte Ireland "may from time to time grade [a registered premises] in such manner as it thinks proper".

As evidenced by the contrasting requirements in legislation, it would seem that the Oireachtas attaches a greater significance to the standards that should be in place in nursing homes, crèches and food premises, than it does in respect of standards to be met by particular grades of hotels. It envisaged that it would be a matter for Fáilte Ireland to decide if, and how, hotels should be rated. As noted, Fáilte Ireland introduced a voluntary scheme in 1993, which provided that a hotel could remain outside of the scheme and remain unclassified. Accordingly, I have drawn a distinction between the inspection of hotels for the purpose of being classified under a voluntary system and, for example, the mandatory inspection of hotel kitchens for the purpose of food hygiene legislation.

Secondly, I see particularly strong public interests in release of records pertaining to food premises, nursing homes and crèches. Non-adherence to standards by food premises has clear implications for public health. Users of nursing homes and crèches are the most vulnerable members of society, and they and their families often have little choice as to whether or not to avail of such a service in the first instance, never mind which service provider to use.

The records at issue in this case pertain to overall assessments of the aesthetics of the hotels, and in so far as limited excerpts thereof pertain to food preparation areas, the relevant inspections do not purport to be of the nature that the HSE is legally obliged to carry out. While, in general terms, I accept that people of all incomes should be able to get value for money when staying or eating in a particular hotel, the fact is that selecting a hotel is often a choice of luxury rather than a choice of necessity. This in itself means that the public is not obliged to buy the services on offer, and is in a better position to shop around for better value than are the users of crèches or nursing homes.

Overall, I find that there is a lower public interest in release of records concerning the inspections of hotels than there is in respect of nursing homes, crèches and food premises.

You have acknowledged that people may shop around when choosing between hotels but say that it is also open to the hotels to charge a lower price than their ratings might support. I accept that, for many reasons, it is in the interests of a hotel to retain or improve on a high, officially-endorsed rating, and indeed it may be the policy of a particular hotel chain for its hotels to aim for a particular rating. Nonetheless, I must bear in mind that the FOI Act was designed to increase openness and transparency in the way in which public bodies conduct their operations and, in general terms, it was not designed as a means by which the operations of private enterprises were to be opened up to scrutiny. Furthermore, hotels are not providing a service on behalf of a public body, nor are they in receipt of public monies (as in the case of nursing homes that are in receipt of subventions for particular patients), nor does the presence or lack of a particular facility in itself have implications for public health.

On balance, in this case, I do not consider there to be a public interest in disclosing the records concerning the inspections of the hotels.

Section 27 and information concerning EIT

As set out earlier, a number of records on the hotels files comprise comments by the hotels as to the way in which EIT conducted the assessment and ratings process. I accept that such comments amount to information about EIT that qualifies for exemption under section 27(1)(b) of the FOI Act.

Again, the records date back to 2003 and 2004. However, given that they pertain to views and discussion of the manner in which EIT carried out its functions on behalf of Fáilte Ireland, I accept that release of such comments could result in a material financial loss or gain to EIT today, specifically in respect of its ability to market its services in the hotel industry. While Fáilte Ireland has been unable to confirm whether or not EIT is still in existence, I accept that section 27 still applies, in that it is possible that EIT is still in business, or may resume business under the name of EIT. Alternatively, I accept that release of such information could impact on the business reputation of those involved in EIT, who I understand are currently involved in other enterprises in the hotels industry.

Accordingly, I consider that section 27(1)(b) applies to such information.

Public interest

As noted, EIT entered into a contract with the precursor of Fáilte Ireland to carry out its functions in respect of the registration of hotels, and in respect of the voluntary classification system. It seems to me entering into a contractual relationship with a public body reduces the public interest in protecting the contractor's right to the protection of commercially sensitive information pertaining to the execution of that contract. At the same time, I also recognise there is a public interest in ensuring that those private enterprises that enter into such relationships with public bodies are in a position to try to enter into other contractual relationships in future, whether with the private or public sector.

I note that a press release was issued by Fáilte Ireland on 1 December 2004 which outlined that the appeals by the hotels had been upheld. Records released by Fáilte Ireland during the course of this review disclose how the decision concerned was reached by the CAB. In general terms, I consider that records showing how the CAB conducted the appeals process and arrived at its decision should be in the public domain.

However, while the records at issue here contain more detail as to the individual grounds of appeal, I do not consider that you would gain additional understanding of the appeals process by the release of the very specific, particular comments about EIT that are contained on the Hotels Files. Release of such comments would not provide any further insight into how Fáilte Ireland operated its star rating system, or as to how it monitored EIT to ensure compliance with the terms of the contract it had entered into, or into the views of the final arbiters on the appeals. Thus, I do not consider that the public interest warrants the potential damage that could be caused to EIT by the release of the specific comments made by the hotels about it.

Accordingly, I consider that such information should be withheld.

Summary in respect of the records on the Hotels Files

I find the remainder of the withheld records to be exempt under section 27(1)(b), in that I am satisfied that they contain commercially sensitive information about either the hotels or EIT, in respect of which the public interest does not warrant their release. Accordingly, I do not need to consider the other exemptions relied on by Fáilte Ireland in respect of these records.

Decision

Having carried out a review under section 34(2) of the Freedom of Information Act 1997, I hereby affirm the decision of Failte Ireland in this case.

Right of Appeal

A party to a review, or any other person affected by a decision of the 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

Emily O'Reilly
Information Commissioner