Case Law >> Commercial confidentiality

Colleen Theron and Deirdre Lyons, from LexisPSL, examine Veolia ruling that scrutinises public authority audits

Veolia Environmental Services lost its appeal against a High Court ruling ordering the company to release to local residents details of its £850 million waste management contract with its waste partner, Nottinghamshire County Council.

The main issue before the court was whether confidential commercial information and invoices contained in a waste management public finance initiative (pfi) contract made between Veolia ES Nottinghamshire and the council, and submitted as part of the contract, came within the Audit Commission Act (ACA) 1998, s.15(1) and were, therefore, open to inspection, or whether they were protected against disclosure.

Section 15(1) of the ACA enables any interested parties to inspect accounts and related documents, including contracts, for a 20-day working period each year.

This goes beyond the right of access in the Freedom of Information Act 2000 (FOIA). In 2007, parliament left this issue untouched when amending ACA, s.15.

Consequently, to date, ACA, s.15 rights have undermined the wider confi dentiality provisions in the FOIA and the Environmental Information Regulations 2004 (EIR).

A third element is art. 1 of the European Convention on Human Rights, which provides protection for “possessions”.

The access route provided by ACA, s.15 to commercially sensitive information has therefore been an area of concern for environmental lawyers for some time. Veolia initiated a judicial review following a request under ACA made by a local waste campaigner.

The court ruled that Veolia had to release the information, revealing how much money the fi rm had been charging the council for each method of waste treatment, such as landfill, incineration, recycling and composting.

The impact of the case on future requests for environmental informationis significant.

In aligning the situation under ACA, s.15 with provisions under reg. 12(5)(e) of EIR and ss.41 and 43 of FOIA, which invite public authorities to take into account issues of confidentiality and commercial sensitivity when determining whether information should be disclosed, the court has closed the loophole that had allowed commercially sensitive documents unavailable under FOIA and EIR to be accessed under ACA.

Public bodies will have to carry out a balancing exercise between the public interest in disclosing the information and the public benefit in maintaining the public and private interests protected by the exemptions (the public interest test).