Notice & Comment

Ethics: European Court of Justice Affirms Scope of Legal Professional Privilege, by Jonathan Rusch

On September 14, the European Court of Justice held, in Akzo Nobel Chemicals v. European Commission, No. C-550/O7 P, that the legal professional privilege did not apply to e-mail communications between a corporate oficer and a corporate in-house lawyer. The decision stemmed from a 2003 investigation by Commission oficials into alleged anticompetitive practices involving two companies established in the United Kingdom, Akzo Nobel Chemicals Ltd (Akzo) and Akcros Chemicals Ltd (Akcros). As part of that investigation, Commission officials took copies of two emails between Akcros’s general manager and Akzo’s coordinator for competition law, who was a member of the Netherlands bar and, at the time, a member of Akzo’s legal department.

The European Court of Justice rejected the companies’ argument that the emails came within the scope of the legal professional privilege. In its 1982 decision in AM & S Europe v Commission, [1982] ECR 1575, the Court had held that the confidentiality of written communications between lawyers and clients should be protected at Community level, but was subject to two cumulative conditions: (1) that the exchange with the lawyer must be connected to “the client’s rights of defence”; and (2) that “the exchange must emanate from ‘independent lawyers’, that is to say ‘lawyers who are not bound to the client by a relationship of employment’.” With regard to the second condition, the Court had also held, in AM & S Europe, “that the requirement as to the position and status as an independent lawyer, which must be fulfilled by the legal adviser from whom the written communications which may be protected emanate, is based on a conception of the lawyer’s role as collaborating in the administration of justice and as being required to provide, in full independence and in the overriding interests of that cause, such legal assistance as the client needs. The counterpart to that protection lies in the rules of professional ethics and discipline which are laid down and enforced in the general interest. The Court also held . . . that such a conception reflects the legal traditions common to the Member States and is also to be found in the legal order of the European Union, as is demonstrated by the provisions of Article 19 of the Statute of the Court of Justice.”

In the present case, the Court found “that the requirement of independence means the absence of any employment relationship between the lawyer and his client, so that legal professional privilege does not cover exchanges within a company or group with in-house lawyers.” Since it found, “both from the in-house lawyer’s economic dependence and the close ties with his employer, that he does not enjoy a level of professional independence comparable to that of an external lawyer,” the Court concluded that the lower court had correctly applied the second condition for the legal professional privilege set forth in AM & S Europe.

This post was originally published on the legacy ABA Section of Administrative Law and Regulatory Practice Notice and Comment blog, which merged with the Yale Journal on Regulation Notice and Comment blog in 2015.

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