On August 23, 2005, the UK’s Department of Trade and Industry (DTI) published a consultation document on the possible reform of Part 9 of the UK’s Enterprise Act 2002, which governs the release of consumer and competition information, and outlined options for disclosing currently confidential commercial information held by public authorities to consumers and businesses for pursuing their own private civil court proceedings.

Currently, the Enterprise Act does not, in general, allow for information to be released to businesses and individuals for the purposes of civil proceedings, although it does permit the disclosure to such persons for criminal proceedings, and in certain other limited circumstances. However, the UK Government is now considering whether it should be easier to disclose information which is currently confidential, and held by government agencies, for example, commercially sensitive information from mergers or antitrust market investigation, to consumers and business competitors for the filing of potential civil cases.

The disclosure of such information held by public agencies would likely result in an increase in the number of UK civil antitrust cases pursued against businesses by consumers and competitors. However, the DTI believes that, although the information released may allow civil claims against legitimate businesses, “[s]ome of these would be likely against businesses that had acted unlawfully”, and, “where information is released and used to pursue a case, it will be because it supports the case, therefore there seems to be only a small risk that legitimate business would be affected”.

The UK Government has, however, recognized that certain information will continue to be protected under EU law. For example, Articles 12 and 29 of the Council Regulation 1/2003/EC restrict the use of information acquired for the purpose of applying Articles 81 and 82 of the EC Treaty (these are the Articles which mainly deal with European antitrust matters); and those in Article 17 of Council regulation 139/2004/EC in relation to information acquired for merger purposes.

The DTI is consulting on the following four options:

Option 1 – Keeping Part 9 unchanged, which would mean that UK public authorities would continue to be unable to disclose information to consumers/business for the purpose of enabling them to seek compensation, or redress through civil law procedures.

Option 2 – Keep Part 9 unchanged, but issue best practice guidance on its application to ensure more consistent application.

Option 3 – Amend Part 9 to allow the release of information for the purposes of private civil proceedings for all cases where restrictions on disclosure of the information are not required by EU law. Disclosure would apply to a more extensive class of information, and, in particular, would include information gathered on UK antitrust issues.

Option 4 – Amend Part 9 to allow the release of information for the purpose of private civil proceedings in some cases only, and reassuring businesses that sensitive commercial information would not be released. For example, disclosure would only be permitted by identifying the UK legislation under which information could be released. Thus, IP right holders under the UK’s Trade Marks Act 1994, would be able to get information from government enforcers to pursue civil cases against counterfeiters.

Part 9 of the Enterprise Act was specifically drafted so that sensitive competition information would be protected from disclosure. If Part 9 remains as drafted, such information will continue to be protected, and other information passed to public agencies in the course of complying with the law could not be disclosed to third parties. However, the wider business community will likely have considerable concerns with Option 3. Market sensitive information could be released to competitors, especially those outside the UK, which could potentially give them an unfair competitive advantage.

The DTI has acknowledged that individual and groups who are thinking of bringing civil proceedings (but who to date had not yet committed themselves) may use this option as an opportunity to go on a ‘fishing expedition’ “to see whether there might be material to bring a case”. Businesses are also concerned that confidential information provided to a public agency to meet certain regulatory requirements could be accessed, and used in evidence against them. The DTI has stated that, “This [Option 3] will be an untried and untested option [and] although public authorities will reassure business that sensitive information will not be disclosed, there is no guarantee of this.”

The period to respond to the DTI’s consultation paper ends on November 18, 2005. The business community will be hoping that the DTI will listen to those respondents who identify options which ensure that business and consumers have access to the relevant information without releasing otherwise sensitive competition information.

Authored by:
Neil Ray