Public interest immunity materials must be read by judge and cannot be disclosed into a confidentiality ring

The Court of Appeal has held that when considering an application to vary or discharge a search warrant, a judge must not decline to read relevant documents that have not been disclosed to the addressee due to public interest immunity, and cannot order the use of a confidentiality ring as an alternative to non-disclosure.

Background

Documents are exempt from the usual disclosure requirements if producing them would be harmful to the public interest. This is known as public interest immunity (PII). One of the situations in which it is regularly used is to protect sensitive details of investigations by public authorities.

In CMA v Concordia International RX (UK) [2018] EWCA Civ 1881, on an ex parte application, the Competition and Markets Authority (CMA) obtained a warrant to search a company’s premises in relation to four investigations. The company had already disclosed information to the CMA in respect of two of the investigations and applied for the warrant to be narrowed to exclude these, in what is understood to be the first challenge to a warrant granted to the CMA.

The company also sought disclosure of material protected by PII that had been before the court when the warrant was granted, which was said to be “likely to be decisive for the legitimacy or otherwise of the warrant.” The CMA suggested, as an alternative, that the material could be disclosed into a confidentiality ring that would allow it to be seen by the company’s lawyers, but not by the company itself.

The judge rejected the proposal of a confidentiality ring and declined to order disclosure. Instead, he held that he had to decide the application to vary the warrant without taking into account the material protected by PII. Both sides appealed.

Decision

The Court of Appeal, following the earlier decision of the Supreme Court in R (Haralambous) v Crown Court at St Albans [2018] UKSC 1 in relation to a criminal search warrant, held that:

• The court could rely on material subject to PII when hearing an ex parte application for a warrant.
• A judge reviewing the warrant was not only entitled, but obliged to consider all relevant material.
• That obligation had to include the PII material seen by the court at the ex parte hearing. Otherwise, a validly issued warrant could be quashed.
• The appropriate time for the court to form a view as to the scope of any PII protection was once a challenge had been made. The CMA did not have to distinguish at the ex parte hearing between material that could and could not be disclosed to the addressee.
• Once the court had held that material was covered by PII, it could not be disclosed, whether into a confidentiality ring or otherwise.
• Although confidentiality rings were common in competition cases, they were only appropriate where the purpose was to protect commercially sensitive information and not to address PII concerns.

Comment

The Supreme Court in Haralambous indicated that search warrants in competition cases were “broadly parallel” to those in criminal cases. It is therefore likely that courts dealing with challenges to PII outside the competition context, including search warrants granted under other legislation, will follow the guidance offered by the Court of Appeal.

The decision confirms that the CMA can rely on material covered by PII to obtain a warrant without the risk that it will have to be provided to the addressee or to its lawyers on any subsequent application or appeal, even if it is likely to have a decisive impact on the outcome. This of course places the addressee in the difficult position of trying to meet a case that it is unable fully to understand and on which its lawyers cannot fully advise.

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