Whether the IDA was justified in refusing access to records relating to a purchase of land, under sections 30, 35, 36, 37 and 40 of the FOI Act

22 July 2021

Background

On 4 September 2020, the applicant made an FOI request to the IDA for a record of sites owned by the IDA in Westmeath, the purchase price of particular lands in Westmeath and any valuation reports prepared regarding that purchase. The IDA issued its decision on 1 October 2020. It granted access to certain information and refused access to the remaining records on the ground that they were exempt under sections 30, 35(1)(a), 36, 37 and 40 of the FOI Act. On 6 October 2020, the applicant applied for an internal review of the decision. The IDA issued an internal review decision on 29 October 2020, in which it affirmed the original decision. On 5 November 2020, the applicant sought a review by this Office of the IDA's decision.

I have decided to conclude this review by way of a formal binding decision. In conducting my review, I have had regard to the correspondence between the applicant and the IDA as outlined above and to the correspondence between this Office and both parties, as well as the content of the records provided to this Office by the IDA for the purposes of this review. I have also had regard to submissions obtained from a third party.

Scope of this Review

The IDA granted access to Records 1 and 2 in part. It granted access to Record 3 in full. References to page numbers of Record 2 should be taken to refer to the withheld information within those pages. During the review, the IDA also claimed that the withheld information is exempt under section 35(1)(b) of the FOI Act. This Office’s Investigator drew this point to the applicant’s attention. The question for me is whether the withheld information is exempt under sections 30(1)(c), 35(1)(a), 35(1)(b), 36(1)(b), 36(1)(c), 37(1) and 40(1)(c) of the FOI Act.

Preliminary Matters

Before considering the exemptions claimed, I wish to note the following points. First, my jurisdiction under section 22 of the FOI Act is to make a new decision, in light of the facts and circumstances as they apply on the date of the review. The Courts have endorsed this approach.

Secondly, while I am required to give reasons for my decision under section 22(10) of the FOI Act, I am also required to take reasonable precautions to prevent disclosure of information in an exempt record, under section 25. This means that the extent to which I can describe the records and the level of detail I can discuss in my analysis are limited. Thirdly, with certain limited exceptions (e.g. section 37(2), which I consider below), the FOI Act does not provide for the limiting of access to records to particular individuals only. When a record is released under the FOI Act, it effectively amounts to disclosure to "the world at large" (H.(E.) v Information Commissioner [2001] IEHC 58). The FOI Act places no restrictions on the type or extent of disclosure or the subsequent use to which the record may be put.

Analysis and Findings

Section 37 – Personal Information

Section 37(1)

Section 37(1) provides that access to a record shall be refused if it would involve the disclosure of personal information. The FOI Act defines the term “personal information” as information about an identifiable individual that would, in the ordinary course of events, be known only to the individual or his/her family or friends, or information about the individual that is held by a public body on the understanding that it would be treated as confidential. The FOI Act details fourteen specific categories of information that is personal without prejudice to the generality of the foregoing definition. These categories include “(xiii) information relating to property of the individual (including the nature of the individual’s title to any property)”.

The IDA says that section 37(1) applies to certain information on pages 3, 4, 10, 13, 14, 15, 20, 21 and 22 of Record 2: the name of an employee of the vendor; the names and addresses of the former owners of the land; and the price paid for the land sold to the IDA. I have examined the records. I accept that pages 3, 4, 10, 13, 14, 15, 20, 21 and 22 of Record 2 contain information relating to identifiable individuals other than the applicant. They disclose the names and addresses of the previous owners of the land, as well as the name and nationality of an employee of a company. I am satisfied that section 37(1) applies to this information. I also note that Record 1 and page 14 of Record 2 disclose folio numbers; i.e. information relating to the property of an individual. I therefore find that section 37(1) applies to that information. My findings are subject to other provisions of section 37, which I examine below.

However, I do not accept that the purchase price of itself comprises personal information about an identifiable individual, under section 37. I find that section 37(1) does not apply to this information. I consider the purchase price below, under the other exemptions claimed.

Section 37(2)

Section 37(2) of the FOI Act sets out certain circumstances in which the exemption at section 37(1) does not apply. I am satisfied that none of the circumstances in section 37(2) applies to the records. That is to say: (a) it does not relate to the applicant; (b) the third parties have not consented to the release of the information; (c) the information is not of a kind that is available to the general public; (d) the information does not belong to a class of information which would or might be made available to the general public; and (e) the disclosure of the information is not necessary to avoid a serious and imminent danger to the life or health of an individual.

Section 37(5) - The Public Interest

Section 37(5) of the FOI Act provides that access to the personal information of a third party may be granted where (a) the public interest that the request should be granted outweighs the right to privacy of the individual to whom the information relates, or (b) the grant of the request would benefit the person to whom the information relates. It has not been argued that releasing the records would benefit the individuals to whom the information relates and I find that section 37(5)(b) does not apply in the circumstances. I will therefore consider section 37(5)(a).

In carrying out any review, this Office has regard to the general principles of openness and transparency set out in section 11(3) of the FOI Act. Section 11(3) provides that an FOI body must have regard to the need to achieve greater openness in the activities of FOI bodies and to promote adherence by them to the principles of transparency in government and public affairs and the need to strengthen the accountability and improve the quality of decision making of FOI bodies. It is important to note that in The Minister for Communications, Energy and Natural Resources and the Information Commissioner & Ors [2020] IESC 57, the Supreme Court found that a general principle of openness does not suffice to direct release of records in the public interest and “there must be a sufficiently specific, cogent and fact-based reason to tip the balance in favour of disclosure”. Although the Court’s comments were made in cases involving confidentiality and commercial sensitivity, I consider them to be relevant to the consideration of public interest tests generally.

Both the language of section 37 and the Long Title to the FOI Act recognise a very strong public interest in protecting the right to privacy, which has a Constitutional dimension, as one of the un-enumerated personal rights under the Constitution. Also, the strong protection afforded to privacy rights under FOI is consistent with Article 8 of the European Convention on Human Rights. It is noteworthy that unlike other public interest tests provided for in the FOI Act, there is a discretionary element to section 37(5)(a), which is a further indication of the very strong public interest in the right to privacy. Privacy rights will therefore be set aside only where the public interest served by granting the request (and breaching those rights) is sufficiently strong to outweigh the public interest in protecting privacy. It is also relevant to note that release of the information must effectively be regarded as release to the world at large.

I find no relevant public interest in granting access to the information concerned that on balance outweighs the public interest in upholding the privacy rights of the individuals whose personal information would be disclosed by releasing the information concerned. In the circumstances, I find that section 37(5)(a) does not apply. I find that the IDA was justified in refusing access to this information under section 37(1) of the FOI Act.

Section 30 – Functions and negotiations

Section 30(1)(c)

The IDA claims that the records are exempt under section 30(1)(c) of the FOI Act. Section 30(1)(c) allows an FOI body to refuse to grant an FOI request if access to the record could, in the opinion of the head, reasonably be expected to disclose positions taken, or to be taken, or plans, procedures, criteria or instructions used or followed, or to be used or followed, for the purpose of any negotiations carried on or being, or to be, carried on by or on behalf of the Government or an FOI body. Section 30(1) is subject to a public interest test under section 30(2).

It is important to note that this exemption does not contain a harm test. It is sufficient that access to the record concerned could reasonably be expected to disclose such negotiation positions, plans etc. An FOI body relying on section 30(1)(c) should identify the relevant negotiations at issue. Section 30(1)(c) makes no distinction between disclosures which have the potential to prejudice current or future negotiations or to cause some other harm and disclosures which do not. However, such a distinction should be made in applying the public interest test in section 30(2) to records which disclose positions taken etc. for the purposes of negotiations.

A distinction should be made between the outcome of negotiations and a position taken or plan, procedure etc. used for the purpose of a negotiation. While a record might reveal the outcome of negotiations, it may not necessarily be reasonably expected to disclose the positions taken or reveal plans or procedures etc. used for the purpose of a negotiation. The Commissioner has also distinguished between disclosing the existence of a fact and disclosing a position or plan used for the purposes of negotiations.

The IDA says that the records relate to sensitive negotiations with a view to an acquisition of land. It says that they could reasonably be expected to disclose positions taken, or to be taken, by the IDA for the purpose of negotiations. It says that they could disclose the valuation, the amounts which it might be willing to pay the vendor and the basis of the valuation, including the criteria which the IDA and its service providers might consider in determining an appropriate valuation.

The applicant says it is not credible that the IDA can adopt a position whereby the purchase price of a property is a secret, when other public bodies do not take this approach. He says that other bodies publish such prices as a matter of routine, without any apparent adverse effect on their ability to operate in the commercial property sector. The applicant also says that the purchase price of a property is not commercially sensitive.

Having examined the records, I accept that certain information could reasonably be expected to disclose positions taken or plans, procedures etc. to be used for the purpose of negotiations. Pages 4 (only from “Opinion of Value” onwards), 6, 7, 11, 12 and 17 (only from the final heading onwards) – 22 of Record 2 disclose valuations and their bases, market comparisons, and negotiation details. I find that section 30(1)(c) applies to these pages, except for the references to the purchase price on pages 4 and 22.

However, Record 1 (except the folio numbers) and the remaining information in Record 2 disclose the following: a factual background on the Irish economy; information about the site itself; the purchase price that was ultimately paid; and details of payment. I am not satisfied that this particular content could reasonably be expected to disclose positions taken or plans, procedures etc. to be used for the purpose of negotiations by the IDA. The background about the Irish economy and the information about the site outline facts and, in my view, not information envisaged by section 30(1)(c). The purchase price and details of payment reflect the outcome of the negotiations, as opposed to positions or plans or procedures adopted. I therefore do not accept that section 30(1)(c) applies to Record 1 and the remaining information in Record 2. I find that the IDA was not justified in refusing access to that information under section 30(1)(c).

Section 30(2)

I am then required to consider section 30(2) in relation to the information to which section 30(1)(c) applies. Section 30(2) of the FOI Act provides that section 30(1) shall not apply if the public interest would, on balance, be better served by granting than by refusing to grant the FOI request concerned.

On the one hand, section 30(1)(c) itself reflects the public interest in protecting positions taken for the purpose of any negotiation carried on by or on behalf of the Government or an FOI body. In this case, I accept that there is a public interest in protecting positions taken by the IDA for the purpose of negotiations about properties. 

On the other hand, I must consider whether there is a public interest in disclosing the specific content of the records. As noted above, this Office has regard to the general principles of openness and transparency set out in section 11(3) of the FOI Act. However, it is important to note that in The Minister for Communications, the Supreme Court found that a general principle of openness does not suffice to direct release of records in the public interest and “there must be a sufficiently specific, cogent and fact-based reason to tip the balance in favour of disclosure”.

The IDA says that as it is responsible not only for maintaining a property portfolio but also for developing foreign investment, it would not be in the public interest for every stage of its property negotiations to be publicly available. It says that this could prejudice its competitive position regarding property negotiations and the development of foreign investment. The IDA does not believe that it is in the public interest to reveal valuations as well as the amounts paid for property where revealing those details could reveal pricing and negotiation strategy and thereby prejudice other negotiations.

I note that the Department of Public Expenditure and Reform Circular 17/2016 Policy for Property Acquisition and for Disposal of Surplus Property emphasises the need to ensure that optimal value for money is achieved in managing the State’s property portfolio. It is my view that this reflects the public interest in allowing scrutiny of information regarding expenditure of this nature. The following content discloses the opinion of value of the site concerned: from “Opinion of Value” to “as follows:” on page 4 of Record 2; from “we estimated” to “per acre” on page 21 of Record 2; and the first paragraph of page 22 of Record 2. On balance, I consider that the public interest would be better served by releasing this specific content. That would allow for scrutiny of the actual purchase price paid by the IDA for the site concerned as against the valuation given in this particular case. I find that the IDA was not justified in refusing access to this information under section 30(1)(c).

However, on balance, I consider that the public interest in protecting the IDA’s positions for negotiations outweighs the public interest in disclosing the other information in Pages 4, 6, 7, 11, 12 and 16 - 22 of Record 2. That comprises detailed information about valuation bases, assumptions used, and negotiations. I find that the IDA was justified in refusing access to this information under section 30(1)(c).

I will now consider the other exemptions claimed in relation to the information which I have not found to be exempt. I will refer to that information as “the remaining information”.

Section 36(1) - Commercial Sensitivity

Section 36(1)(b)

Section 36(1)(b) of the FOI Act provides that an FOI body shall refuse to grant an FOI request if the record concerned contains 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.

The harm test in the first part of section 36(1)(b) is that disclosure "could reasonably be expected to result in material loss or gain". This Office takes the view that the test to be applied is not concerned with the question of probabilities or possibilities but with whether the decision maker's expectation is reasonable. The harm test in the second part of section 36(1)(b) is that disclosure of the information "could prejudice the competitive position" of the person in the conduct of their business or profession. The standard of proof to be met here is considerably lower than the "could reasonably be expected" test in the first part of this exemption.  However, this Office takes the view that, in invoking "prejudice", the damage which could occur must be specified with a reasonable degree of clarity. Section 36(1) does not apply if the public interest would, on balance, be better served by granting rather than refusing the request (section 36(3) refers).

First, the IDA says that disclosing the cost associated with the purchase could reasonably be expected to result in a financial loss or gain to the former owner in the conduct of their business, as it may highlight the vendor’s approach to property sales and prejudice other property sales by revealing their negotiating position. Secondly, the IDA says that disclosure could be expected to result in material financial loss or gain to the IDA in negotiations to attract foreign investment. It says that the records give insights into the competitive position of a particular site and its service providers. It says that releasing commercially sensitive information would prejudice consultants, site owners and service providers from providing information of a similar nature to the IDA in future. The IDA says that disclosing the information would potentially reduce Ireland’s competitiveness for new business and expansions, in an environment of intense international competition.

During the review, the Investigator invited the company that prepared the valuation report and the vendor to make submissions. The company made submissions and the vendor did not. The company says that information provided by it to clients such as the IDA is commercially sensitive and private and confidential. It says that it is retained as a property adviser on behalf of government agencies including the IDA and other semi state companies in the acquisition of lands for various purposes. It submits that the release of such confidential information to the public will have an adverse effect on current and future projects.  

For section 36(1)(b) to apply, there must be a link between disclosure and the harms alleged. In the High Court case of Westwood Club v The Information Commissioner [2014] IEHC 375, Cross J. held that it is not sufficient for a party relying on section 36(1)(b) to merely restate the provisions of the section, list the documents and say that they are commercially sensitive. A party opposing release should explain why disclosure of the particular records could prejudice their financial position. As the Supreme Court observed in the Minister for Communications case, it is not sufficient for the FOI body to merely assert that disclosure could prejudice its competitive position; an FOI body must also have a reasonable basis for that position.

The remaining information comprises the purchase price, valuation and facts about the properties and the Irish economy, other than those I have found to be exempt under section 30. I have found the names of the former owners to be exempt under section 37. I do not consider it credible that disclosing the purchase price which the vendor agreed for a particular site at a particular time could prejudice the previous owner’s competitive position or reasonably be expected to result in material loss to them. Neither do I accept that disclosing the remaining information could prejudice the IDA’s competitive position or reasonably be expected to result in material loss to it and the IDA has not demonstrated how such harms could flow from disclosure.

The company submits that the information is commercially sensitive and that releasing such confidential information will have an adverse effect on future projects. However, it does not identify the link between disclosure and the harms it alleges. From my examination of the remaining information, I am unable to conclude that such a link exists.

In summary, I am not satisfied that disclosing the records could prejudice the competitive position of the parties, or that it could reasonably be expected to result in material loss to them. I find that section 36(1)(b) does not apply to the remaining information.

Section 36(1)(c)

Section 36(1)(c) provides that an FOI body shall refuse to grant an FOI request if the record concerned contains information whose disclosure could prejudice the conduct or outcome of contractual or other negotiations of the person to whom the information relates. The standard of proof required to meet section 36(1)(c) is relatively low in the sense that the test is not whether prejudice or harm is certain to materialise but whether it might do so. Having said that, the Commissioner expects that a person seeking to rely on section 36(1)(c) would be able to show that contractual or other negotiations were in train or were reasonably foreseen which might be affected by the disclosure and explain how exactly the disclosure could prejudice the conduct or the outcome of such negotiations. As noted above, section 36(1) does not apply if the public interest would, on balance, be better served by granting rather than refusing the request (section 36(3) refers).

The IDA says that disclosing the cost associated with the purchase could be expected to prejudice the outcome of future negotiations that IDA may have with other vendors and with foreign investors where those negotiations relate to the acquisition and/or use of the land, as it would reveal the negotiating approach taken by the IDA. As noted above, the remaining information discloses the purchase price as well as the valuation and facts about the properties and the Irish economy. I am not persuaded that the purchase price or the other remaining information discloses the IDA’s negotiating approach, so much as the outcome of particular negotiations associated with the site and facts about that site. In any event, the IDA has not identified negotiations about the site (or other sites) which are in train and which might be affected by disclosure. Neither has it identified negotiations which are reasonably foreseen and which might be affected by disclosure. In the circumstances, there is no basis for me to find that section 36(1)(c) applies to the remaining information.

Given this finding, I am not required to consider sections 36(2) or (3). I find that the IDA was not justified in refusing access to the remaining information under section 36(1)(b) or (c) of the FOI Act.

Section 35 – Information obtained in confidence

The IDA claims that the records are exempt under sections 35(1)(a) and 35(1)(b) of the FOI Act.

Section 35(1)(a) applies to a record containing information given to an FOI body in confidence. Four requirements must be satisfied for a record to be exempt under section 35(1)(a): the information was given to an FOI body in confidence; the information was given on the understanding that it would be treated by the FOI body as confidential; disclosure of the information would be likely to prejudice the giving to the body of further similar information from the same person or other persons; and it is important to the body that such further similar information should continue to be given to the body.

Section 35(1)(b) of the FOI Act provides that an FOI body shall refuse to grant an FOI request 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 (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. 

Section 35(2) provides that subsection (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, an FOI body or a service provider) 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 an FOI body or head or a director, or member of the staff of, an FOI body or of such a service provider. Section 2 of the FOI Act defines “service provider” as “a person who, at the time the request was made, was not an FOI body, but was providing a service for an FOI body under a contract for services and contract for services in this definition includes an administrative arrangement between an FOI body and another person”.

As section 35(1) does not apply if the records fall within the terms of section 35(2), I should consider section 35(2) at the outset. Record 1 was prepared by the IDA, which is an FOI body. Record 2 was prepared by a third party for the IDA who, according to that report, was instructed by the IDA to prepare a market valuation and who is therefore a service provider. Therefore, pursuant to section 35(2), section 35(1) will not apply to the records at issue unless disclosing them would constitute a breach of a duty of confidence owed to a person other than an FOI body/service provider etc. under an agreement or statute or otherwise by law.

On section 35(1)(a), the IDA says that the withheld information was given to the IDA with a clear understanding that it would remain confidential, as the parties entered into an agreement. It says that disclosing it would be likely to prejudice the vendor and other parties from giving similar information to the IDA in the future. The IDA says it is important to receive similar information in the future for its property mandate. It says that release would ultimately negatively impact its ability to attract foreign investment and fulfil its statutory functions.

I have outlined the nature of the remaining information above. I am not satisfied that information such as facts about the site or the purchase price can be said to have been given in confidence. Neither do I accept that disclosing the remaining information would prejudice the giving of information from parties to the IDA in the future. I believe that it serves the interests of all parties, including prospective vendors, for a flow of information to continue, in order to agree property transactions. In any event, given my finding under section 35(2), for section 35 to apply, disclosure would have to constitute a breach of a duty of confidence under an agreement or statute or otherwise by law. Accordingly, I am not satisfied that section 35(1)(a) applies to the remaining information. Given this finding, I am not required to consider the public interest balancing test under section 35(3) of the FOI Act.

On section 35(1)(b), the IDA says that an agreement between the IDA and the vendor provides that the identity of the vendor and all information relating to the property that is disclosed by the parties to the agreement should remain confidential. The IDA acknowledges that it has released certain information relating to the property. It says that nonetheless it relies on the agreement to invoke section 35(1)(b) in respect of information about the property transaction that has not yet come into the public domain, e.g. the identity of the vendor and the purchase price.

I note that the agreement applies to “confidential information”. The definition of “confidential information” in the agreement is very broadly worded. For example, it covers the IDA’s identity and yet the IDA has released this and other information about the property transaction. The IDA says that a media article made some information about the transaction public. Nonetheless, I do not find it credible that the IDA can now assert such a broadly-worded confidentiality clause over the information it decided not to release in an FOI request, where it released other information about the same transaction. Neither do I accept that the purchase price could qualify as “confidential information” given by one party to the other or that the name of the vendor has the necessary quality of confidence for section 35(1)(b) to apply. The IDA’s position appears to be that by virtue of the information being covered by the confidentiality agreement, it cannot be released. If that were correct, it would allow public bodies to circumvent the FOI Act merely by entering into very broad confidentiality agreements with third parties. I do not accept that this can have been the intention of the Oireachtas. In summary, I am not satisfied that this confidentiality clause could be enforced so as to oust the application of FOI to the remaining information.

I find that the IDA was not justified in refusing access to the remaining information under sections 35(1)(a) or 35(1)(b) of the FOI Act.

Section 40 - Financial and Economic Interests of the State

The IDA claims that the records are exempt under section 40(1)(c) of the FOI Act. Section 40(1)(c) provides that a head may refuse to grant an FOI request in relation to a record and, in particular, but without prejudice to the generality otherwise of this subsection, to a record to which subsection (2) applies) if, in the opinion of the head, access to the record could reasonably be expected to have a negative impact on decisions by enterprises to invest or expand in the State, on their research activities or on the effectiveness of the industrial development strategy of the State, particularly in relation to the strategies of other states.

Where an FOI body relies on section 40(1), it should identify the potential harm specified in the relevant paragraph that might arise from disclosure and then consider the reasonableness of any expectation that the harm will occur. The FOI body should show the link between granting access to the record concerned and the harm identified. It must go on to consider the public interest test under section 40(3) before reaching a conclusion on the application of the exemption.

The IDA submits that disclosing information about the value of the lands and its negotiating approach would prejudice the IDA in future negotiations. It says that the public availability of such information would create difficulties for the IDA in ensuring that it achieves value for money for the State and the taxpayer. The IDA says that it needs to be able to attract foreign investment effectively, by initiating proposals for the creation and development of industry, achieving value for money, protecting the State and the taxpayer from loss or prejudice. I am not satisfied that these are credible claims in relation to the remaining information. I do not see how disclosing the remaining information could make it difficult for the IDA to attract foreign investment effectively.  Having regard to the content of the remaining information and the IDA’s submissions, I am not satisfied that disclosure could reasonably be expected to have a negative impact on decisions by enterprises to invest or expand in the State or on the effectiveness of the industrial development strategy of the State etc. I find that section 40(1)(c) does not apply to the remaining information.

Given this finding, I am not required to consider the public interest balancing test under section 40(3) of the FOI Act. I find that the IDA was not justified in refusing access to the remaining information under section 40(1) of the FOI Act.

Decision

Having carried out a review under section 22(2) of the FOI Act, I vary the IDA’s decision as follows. I affirm its decision to refuse access to certain information under sections 30(1)(c) and 37(1) of the FOI Act, as outlined above. I annul its decision to refuse access to the remaining information and direct its release. Accordingly, the information which falls to be withheld is as follows:

• Record 1: the folio numbers
• Record 2: the names and addresses of the previous owners of the land throughout the document; the name and nationality of an employee of a company; the folio numbers; Pages 4 (the information after “as follows”), 6, 7, 11, 12, 17 (from the final heading onwards) to 21 (except from “we estimated” to “per acre”) and 22 (except the first paragraph)

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 by the applicant not later than eight weeks after notice of the decision was given, and by any other party not later than four weeks after notice of the decision was given.

 

Deirdre McGoldrick

Senior Investigator