Whether the ORNL was justified in its decision to grant partial access to correspondence between ORNL and the applicant relating to alleged upselling of National Lottery games

19 December 2018

Background

This review arises from a decision taken by the ORNL to release certain records on foot of a request to which section 38 of the FOI Act applies. Section 38 applies where the FOI body concerned has, at some stage in the decision-making process, considered that the record(s) in question qualify for exemption under any of sections 35, 36 and 37 of the FOI Act (regarding, respectively, confidential, commercially sensitive, or personal information) but that the record(s) should be released in the public interest.

Where section 38 applies, the body is required to notify affected third parties before making a final decision on whether or not the exemption(s) considered to apply should be overridden in the public interest. The requester or affected third parties, on receiving notice of the final decision of the FOI body, may apply directly to this Office for a review of that decision.

In this case, the ORNL received a request on 9 March 2018 for access to records of "all correspondence/communications/minutes of meetings ... between the RNL and the National Lottery on the issue of sales agent staff "upselling" lottery games". The ORNL notified the applicant of the request and provided copies of redacted records that it proposed to release in the public interest. In its submission of 13 April 2018 the applicant proposed additional redactions to three of the records under section 35 and 36.

Having considered the applicant's submission, the ORNL issued its decision on the request on 26 April 2018, following which the applicant sought a review by this Office of that decision in respect of certain parts of two of the records. In its application for review, it identified specific parts of the two records that it considered should be withheld.

I have decided to conclude this review by way of a formal, binding decision. In conducting this review I have had regard to the contents of the records at issue. I have also had regard to correspondence between the ORNL and both the applicant and the requester on the matter, and to communications between this Office and the applicant, the ORNL, and the requester in relation to this review.

Scope of Review

The two records at issue in this case comprise a letter dated 5 April 2017 from the ORNL to the applicant and a letter dated 1 June 2017 from the Department of Public Expenditure and Reform (on behalf of the Minister in his role as Regulator at the time) to the applicant. This review is concerned solely with whether the ORNL was justified in its decision to grant access to certain additional parts of the two records as identified by the applicant, apart from those parts already redacted by the ORNL in its decision on the request.

Preliminary Matters

Under section 22(12)(a) of the FOI Act, a decision to grant a request to which section 38 applies shall be presumed to have been justified unless the person to whom the information relates shows to the satisfaction of the Commissioner that the decision was not justified. This means that the onus is on the applicant of satisfying this Office that the ORNL's decision to release the relevant parts of the records at issue was not justified.

I must also explain at the outset that section 25(3) of the FOI act requires the Information Commissioner to take all reasonable precautions in the performance of his functions to prevent the disclosure of information contained in an exempt record or that would cause the record to be exempt if it contained that information. For this reason, the description I can give of the applicant's arguments for seeking the redaction of certain information under section 36 and of the reasons for my decision on that matter are somewhat limited in this case.

Analysis and Findings

The records at issue in this case form part of an exchange of communications between the ORNL following a report in the media of alleged upselling of National Lottery products. The letters are concerned with the interpretation of Clause 9.9 of the Licence to operate the National Lottery, which prohibits the licensee, its subsidiaries and all retailers from making unsolicited telephone calls or other forms of direct or personal communication with a view to encouraging the purchase of tickets in a National Lottery game without the prior written approval of the Regulator.

The applicant argued that the information in question is exempt from release under sections 35 and 36 and that the public interest would be better served by withholding that information. In essence, its argument is that the release of the information would disclose the position it took on the interpretation of Clause 9.9 and that such information is commercially sensitive and, by extension, is also confidential. As such, it seems to me that it is more appropriate to consider the applicability of section 36(1) to the information at issue in the first instance.

Section 36(1)

Section 36(1) states that (1) Subject to subsection (2), a head shall refuse to grant an FOI request 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.

The applicant's arguments relate to its views that subsections (a) and (b) apply. As it has made no argument that subsection (c) applies, I do not need to consider the applicability of that subsection.

Section 36(1)(a)

In its submission of 13 April 2017 to the ORNL, the applicant argued that the disclosure of certain information in the letter of 5 April 2017 would disclose important trade secrets and those of its shareholder, An Post. It gave an example of how the release of specific information would disclose An Post's marketing practices when launching new products and that such information constitutes trade secrets of An Post. Having regard to the nature of the deletions made to the record by the ORNL, I do not accept that the disclosure of the information that the applicant wishes to be redacted would disclose An Post's marketing practices in any great detail. Even if it did and given its general nature, I do not accept that such information would constitute a trade secret of an Post.

I also note that the applicant failed to identify any specific information in the records whose disclosure would involve the disclosure of its trade secrets. Having regard to the provisions of section 22(12)(a), I find that section 36(1)(a) does not apply to any of the information at issue.

Section 36(1)(b)

On the matter of the applicability of section 36(1)(b), the applicant argued that the release of the information at issue could place it at a significant disadvantage from unfair competition by other operators which are not subject to the same regulation as it. However, it has not explained how such harm might arise, nor is it clear to me how it might arise.

The applicant also argued that its views on the interpretation of Clause 9.9 are commercially sensitive. While I am restricted by section 25(3) in the level of detail I can give, I can say that the applicant's argument is that the release of that information implies certain matters about the operations of the applicant that are not true. I do not accept that argument. Having examined the records, it seems to me that they clearly explain the issues arising and the applicant's position on the matter.

In the circumstances, and having regard to the provisions of section 22(12)(a), I find that section 36(1)(b) does not apply to any of the information at issue.

Section 35(1)

Section 35(1) states that "Subject to this section, a head shall refuse to grant an FOI request if

(a) the record concerned contains information given to an FOI body, in confidence and on the understanding that it would be treated by it as confidential (including such information as aforesaid that a person was required by law, or could have been required by the body pursuant to law, to give to the body) and, in the opinion of the head, 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, or  
(b) disclosure of the information concerned would constitute a breach of a duty of confidence provided for by a provision of an agreement or enactment (other than a provision specified in column (3) in Part 1 or 2 of Schedule 3 of an enactment specified in that Schedule) or otherwise by law.

The confidentiality exemption generally does not apply to a record prepared by a staff member of an FOI body or a service provider "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 an FOI body or head or a director, or member of the staff of, an FOI body or of such a service provider" (section 35(2) refers).  In addition, section 35(1)(a) does not apply if the public interest would, on balance, be better served by granting rather than by refusing to grant the request (section 35(3) refers)

The records at issue in this case were prepared by FOI bodies. As such, section 35(1) cannot apply unless disclosure of the information at issue 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 an FOI body or its staff. The applicant argued that section 35(1) applied by virtue of the duty of confidence provided for by Clause 20.6 of the Licence under which it operates and owed to it as a third party that is not subject to the FOI Act.

Clause 20 of the Licence (which is publicly available on the ORNL website) is concerned with the provision of information by the Licensee to the Regulator. Paragraph 6 provides that the Regulator shall not disclose to any third party any of the Licensee's confidential information which may be provided to the regulator pursuant to any provisions of the Licence and/or the National Lottery Act 2013 without the prior written permission of the Licensee. It further provides that the Licensee's confidential information shall include, without any limitation, the Licensee's trade secrets, management accounts, financial structure, financial statements (whether audited or not), commercial plans, contractual arrangements with any third party, shareholder agreements and arrangements and details of the Licensee's human and other resources, management, policies and procedures unless such information is already in the public domain.

As I have already outlined, the applicant's argument is that the release of the information would disclose the position it took on the interpretation of Clause 9.9 and that such information is commercially sensitive and, by extension, is protected from release by virtue of Clause 20.6. It argued that this Office has previously recognised that Clause 20.6 precludes the release of the applicant's commercially sensitive information, including trade secrets. However, I have already found that the information at issue in this case is not commercially sensitive. As such, I am satisfied that the information is not of a type that falls for protection under Clause 20.6. I find, therefore, that the release of the information at issue would not constitute a breach of a duty of confidence provided for by Clause 20.6 of the Licence.

For the sake of completeness, I should add that I have also considered whether an equitable duty of confidence might exist.

In Mahon v. Post Publications [2007] IESC 15, Fennelly J confirmed that the requirements for a successful action based on a breach of an equitable duty of confidence, at least in a commercial setting, are found in the judgment of Megarry J in Coco v. A. N. Clark (Engineers) Ltd. [1969] R.P.C. 41, at 47:

"[T]hree elements are normally required if, apart from contract, a case of breach of confidence is to succeed. First, the information itself -¦ must -˜have the necessary quality of confidence about it-™. Secondly, that information must have been imparted in circumstances importing an obligation of confidence. Thirdly, there must be an unauthorised use of that information to the detriment of the party communicating it."

Fennelly J restated the requirements of the equitable doctrine of confidence as follows:

1. "The information must in fact be confidential or secret: it must, to quote Lord Greene, 'have the necessary quality of confidence about it';
2. It must have been communicated by the possessor of the information in circumstances which impose an obligation of confidence or trust on the person receiving it;
3. It must be wrongfully communicated by the person receiving it or by another person who is aware of the obligation of confidence."

The correspondence at issue in this case concerns the interpretation of a clause of the Licence under which the applicant operates the National Lottery. One of the functions of the Regulator is to monitor the operation of the National Lottery and to monitor and enforce compliance with the Act and the Licence to operate the National Lottery and the records at issue arose as a result of the ORNL carrying out that function. It seems to me that the information at issue in this case does not have the necessary quality of confidence about it. It is not, for example, commercially sensitive for the reasons I have outlined above. Furthermore, given the nature of the information and the circumstances in which it was given, I do not accept that it was communicated to the ORNL in circumstances imposing an obligation of confidence or trust on the ORNL. I find, therefore, that the release of the information at issue would not constitute a breach of an equitable duty of confidence owed to the applicant.

In conclusion, therefore, I find, having regard to the provisions of section 22(12)(a), that section 35(1) does not apply to any of the information at issue.

Decision

Having carried out a review under section 22(2) of the Freedom of Information Act 2014, I affirm the decision of the ORNL to grant access to certain additional parts of the two records at issue as identified by the applicant.

Right of Appeal

Section 24 of the FOI Act sets out detailed provisions for an appeal to the High Court by a party to a review, or any other person affected by the decision.  In summary, such an appeal, normally on a point of law, must be initiated not later than four weeks after notice of the decision was given to the person bringing the appeal.

Stephen Rafferty
Senior Investigator