Judgment
Title: | CRH Plc, Irish Cement Ltd & ors -v- The Competition and Consumer Protection Commission |
Neutral Citation: | [2017] IESC 34 |
Supreme Court Record Number: | 65/2016 |
High Court Record Number: | 2015 9210 P |
Date of Delivery: | 05/29/2017 |
Court: | Supreme Court |
Composition of Court: | Denham C.J., MacMenamin J., Laffoy J., Dunne J., Charleton J. |
Judgment by: | Laffoy J. |
Status: | Approved |
Result: | Appeal dismissed |
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| Judgments by | Link to Judgment | Concurring | MacMenamin J. | | | Laffoy J. | | Denham C.J., Dunne J., Charleton J. | Charleton J. | | Denham C.J., Laffoy J., Dunne J. | |
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THE SUPREME COURT[Appeal No. 65/16]
Denham C.J.
MacMenamin J.
Laffoy J.
Dunne J.
Charleton J.
BETWEENCRH PLC, IRISH CEMENT LIMITED AND SEAMUS LYNCH
PLAINTIFFS/RESPONDENTS
AND
THE COMPETITION AND CONSUMER PROTECTION COMMISSION
DEFENDANT/APPELLANT
Judgment of Ms. Justice Laffoy delivered on 29th day of May, 2017
Introduction
1. In this judgment I propose addressing one discrete aspect of the issues which arise on this appeal, namely, the invocation by the respondents, as Plaintiffs in the High Court of Article 8 of the European Convention on Human Rights (“the Convention”) and Articles 7 and 8 of the Charter of Fundamental Rights of the European Union (“the Charter”). In particular, I propose considering the manner in which this aspect was dealt with in the judgment of the High Court delivered by Barrett J. (“the trial judge”) on 5th April, 2016 ([2016] I.E.H.C. 162), as a pathway to considering the submissions made by both parties in this Court. As the context of the dispute between the parties is an inspection conducted by the appellant (“the Commission”) pursuant to the statutory provisions contained in the Competition and Consumer Protection Act 2014 (“the Act of 2014”) conferring powers on the Commission for the purpose of obtaining information which may be required in relation to a matter under investigation under the Competition Act 2002 (“the Act of 2002”), for the reason which will be explained later, it is necessary to consider recent relevant case law of the Courts of the European Union cited by the parties on the appeal in some depth. Further, as s. 3 of the European Convention on Human Rights Act 2003 (“the Act of 2003”) mandates that every organ of the State shall perform its functions in a manner compatible with the State’s obligations under the Convention provisions, it is also necessary to consider recent jurisprudence of the European Court of Human Rights (“ECtHR”) cited by the parties in some depth.
The claims in the proceedings based on the Convention and the Charter
2. The action under appeal was a plenary action in which the respondents were plaintiffs and the Commission was defendant. For convenience, hereafter the respondents will be collectively referred to as “the Respondents” and individually they will be referred to as “CRH”, “ICL”, and “Mr. Lynch”. The action was heard in the High Court on affidavit evidence, some of which appears initially to have been filed in the context of an application by the Respondents for an interlocutory injunction, which was disposed of by an undertaking given by the Commission when that application came before the High Court on the 24th November, 2015. However, Mr. Lynch was cross-examined on behalf of the Commission in the course of the trial. Relying on the factual basis of the proceedings and the content of the relevant statutory provisions as set out in the judgments of Charleton J. and MacMenamin J., it is sufficient for present purposes to summarise the Respondents’ invocation of the Convention and the Charter by reference to paragraph 25 of the statement of claim delivered by the Respondents and, in particular, the particulars set out in sub-paras. (f), (i), (j) and (l) thereof. The Respondents, as plaintiffs, claimed that the Commission had acted, and was continuing to act, in breach of the Respondents’ rights under Article 8 of the Convention and Article 7 and 8 of the Charter, particularising the breaches as follows:
“(f) Seizing electronic files within [Mr.] Lynch’s ‘crh.com’ e-mail account which are unrelated to the business and activity of ICL but rather are connected to roles held, past and present, in CRH . . .
(i) Seizing documentation the property of CRH . . . and its subsidiaries which said company was not the subject of the Search Warrant.
(j) Unlawfully interfering with the private life, correspondence and/or home of CRH . . . contrary to Article 8 of the Convention, Articles 7 and 8 of the Charter and Article 40.3 of the Constitution. . . .
(l) Seizing personal e-mails and unlawfully interfering with the private life, correspondence and/or home of [Mr.] Lynch contrary to Article 8 of the Convention, Articles 7 and 8 of the Charter and Article 40.3 of the Constitution.”
3. The specific reliefs arising from those allegations, apart from the allegations of breach of Article 40.3 of the Constitution, which the Respondents claimed were:
The Respondents also sought injunctive relief in the following terms:
“An injunction restraining the [Commission] from assessing, reviewing or making any use whatsoever of any books, documents or records howsoever described which were seized by the [Commission] on 14th May, 2015 and which do not relate to an activity in connection with the business of supplying or distributing goods or providing a service at the premises of [ICL] at Platin, Drogheda, County Meath.”
While the Respondents also sought damages pursuant to s. 3(2) of the Act of 2003, in reality, that remedy was not pursued, because, as the trial judge recorded in the judgment (at para. 33), the Respondents had indicated that it was “issues of principle” that concerned them most and they were far more interested in securing a declaration in the terms set out at (a) above than damages.
4. In its defence the Commission expressly denied that the copying or extraction of the relevant information was contrary to Article 8 of the Convention or Articles 7 and 8 of the Charter.
The judgment of the High Court in relation to those claims
Search/seizure
5. Having stated that what he described as the “dawn raid”, in other words, the unannounced inspection, at the premises of ICL at Platin was done pursuant to s. 37 of the Act of 2014, the trial judge (at para. 10 et seq.) construed subs. (1) to (3) of s. 37. The trial judge recorded (at para. 2) that the search warrant issued on 12th May, 2015 authorised one or more authorised officers of the Commission to enter and search those premises and to exercise all or any of the powers conferred on an authorised officer under s. 37 of the Act of 2014. The trial judge then observed (at para. 20) that, in mapping out how a search is to be done and what authorised officers may do during such a search, the Act of 2014 leaves greatly uncharted what is to be done with material, other than legally privileged material, that is seized and ought never to have been seized, suggesting that at this point one “enters terra incognita (or near-incognita)”. He pointed out that there is nothing in the Act of 2014 to indicate what ought to be done as regards such material. Before considering the application of Article 8 of the Convention, the trial judge (at para. 23) considered s. 33 of the Act of 2014, which in broad terms saves privileged legal material from seizure or compulsory disclosure, setting out the reason for so doing as that –
“. . . the process it establishes in respect of legally privileged material informs the type of process that the [Respondents] envision as appropriate for the Commission to adopt in respect of such material as it now possesses, and possession of which it is not entitled to under s.37.”
The Convention
6. The consideration by the trial judge of the application of the Convention to the Respondents’ claims was premised on the Commission having seized material that it had no power to seize, which was logical given the sensible approach adopted by the Commission in its defence. While the Commission stated that, by reason of not having examined the same, it was a stranger to the contents of the e-mail files of Mr. Lynch and, in particular, was a stranger to the plea in the Respondents’ statement of claim that a significant portion of the documents in question do not relate to any activity in connection with the business of supplying or distributing goods or providing a service at the premises of ICL at Platin, the Commission pleaded (at para. 1 of its Defence):
“For the purpose of these proceedings, however, the [Commission] accepts that as a matter of high probability not all of the e-mails of [Mr. Lynch] will relate to the activity aforesaid.”
The trial judge’s analysis of the application of the Convention to the circumstances under consideration was immediately preceded by the following statement (at para. 27):
“That s.37 of the Act of 2014 should allow the Commission to possess such materials and does not contain a mechanism whereby this can be remedied without the Commission reviewing those materials has the result, the [Respondents] claim, that certain of their respective fundamental rights stand to be contravened.”
7. There follows a comprehensive analysis by the trial judge of the application of the Convention and authorities of the ECtHR to the circumstances before him, the starting point being Article 8, which the Respondents invoke and which provides:
“1. Everyone has the right to respect for his private and family life, his home and his correspondence.
2. There shall be no interference by a public authority with the exercise of this right except such as is in accordance with the law and is necessary in a democratic society in the interests of national security, public safety or the economic well-being of the country, for the prevention of disorder or crime, for the protection of health or morals, or for the protection of rights and freedoms of others.”
8. The trial judge recorded that it was accepted by all of the parties that the “dawn raid” on the premises at Platin and the copying of records found there can constitute an interference by a public authority with the private life of one or more of the Respondents, so that what he had to determine was whether such interference as had occurred had been done (1) in accordance with law, and (2) is necessary in a democratic society. He then considered those issues by reference to seven decisions of the ECtHR.
9. To put his approach in perspective, it is appropriate to refer to the earliest decision of the ECtHR to which the trial judge referred, that is to say, Olsson v. Sweden (No 1) (App. No. 10465/83, 24th March, 1988) (“the Olsson case”), although the parties did not attach particular significance to it on the appeal. Having quoted from the judgment as to the meaning of “in accordance with law” in Article 8, the trial judge stated (at para. 37):
“The court does not consider any of this to present a difficulty as regards the conduct of the ‘dawn raid’ that is in issue in these proceedings and the taking away of the materials that were taken thereafter. . . . Where the court does consider a difficulty to arise, . . . is when it comes to the terra incognita (or near-incognita) that it has referred to previously above, viz. when one moves into the space of determining what is to happen in respect of materials (other than legally privileged materials covered by s.33) which are taken during such a ‘raid’ and which do not, to borrow again the wording of s.37(1), comprise information that ‘may be required in relation to a matter under investigation’. The Commission says it is entitled to screen all the information that it has taken, the [Respondents] claim that such a screening will involve a contravention of fundamental human rights. The Act of 2014 offers no guidance as to what is to be done in this regard and here, it seems to the court, one enters the realm of arbitrariness, against which there is no true protection afforded by the Act, the ‘leaky’ text of s.25 notwithstanding.”
By way of explanation of the last sentence in that quotation, the trial judge had earlier characterised s. 25, which imposes obligations on members of the Commission, its authorised officers and staff in relation to confidential information, as the “leakiest of sieves”. The objective of quoting the passage from the judgment of the trial judge just quoted is to demonstrate where he considered a difficulty to arise under Article 8 of the Convention in relation to the application of s. 37 to the factual position. It is the absence of guidance as to what is to be done after seizure in relation to material which the Commission was not authorised to seize, which he considered to be the source of the difficulty. Later, in his judgment, he made the same point, having quoted from the judgment in the Olsson case on the meaning of “necessary in a democratic society” in Article 8.
10. The trial judge reiterated that same point as being the difficulty he perceived to exist in relation to the application of s. 37 following his consideration of the subsequent decisions of the ECtHR to which he referred, namely:
(a) Niemetz v. Germany (1993) 16 E.H.R.R. 97, which concerned the search of a lawyer’s office.
(b) Societé Colas v. France (2004) 39 E.H.R.R. 17, which, although, involving a search in a competition law context, the trial judge considered not to be especially pertinent, although he reiterated the difficulty in this case as he perceived it by reference to the decision of the ECtHR in the Olsson case, both in the context of what “in accordance with law” means and what is “necessary in a democratic society” under Article 8.
(c) Robathin v. Austria (App. No. 30457/06, 3rd July, 2012), (“the Robathin case”), which arose from search and seizure of electronic data at a lawyer’s office.
(d) Bernh Larsen Holding AS and others v. Norway [2013] ECHR 24117/08. (“the Bernh Larsen case”).
(e) Delta Pekárny v. Czech Republic (App. No. 97/11, 2nd October, 2014) (“the Delta Pekárny case”)
(f) Vinci Construction v. France (App. Nos. 63629/10 and 60567/10, 2nd April, 2015) (“the Vinci case”).
11. In his consideration of all of the foregoing authorities, the trial judge rationalised his concern that there was a breach of Article 8 by reference to what, adopting his phraseology, might be called the terra incognita point. With reference to the Robathin case, he explicitly found that there was no “general search” in this case of the type which had been condemned by the ECtHR in that case. Indeed, he implicitly accepted that the Commission takes a measured approach to the searches it conducts, “in line with relevant standards adopted by major jurisdictions such as the United Kingdom and the United States”. However, he reiterated his concern arising from the terra incognita point, posing (at para. 45) the following rhetorical question:
“How can it be proportionate to the legitimate aim pursued by the Commission in doing the ‘dawn raid’ and taking such information as it took, that it would now be permitted by law (if it is permitted by law) to view and review such material as it was not allowed to seize and possess?”
12. Having considered the Bernh Larsen case, the trial judge, in essence, returned to the terra incognita point, although without using that terminology. Once again (at para. 48) he identified the difficulty as “what is to happen with the information that has been seized and which ought not to have been seized and in respect of which, s. 33-style situations aside, there is no provision made in the Act of 2014”. He went on to outline the respective positions of the parties in the High Court as follows:
“The Commission maintains that it should get to sift through all the material that it has seized and determine what comes within the terms of the search warrant and what does not. The [Respondents] contend that for the Commission to go through material that it was not authorised by warrant to remove gives rise, literally and legally, to an unwarranted breach of the right to privacy. This is a contention with which the court respectfully agrees.”
That last sentence, in my view, may be regarded as the ratio decidendi of the trial judge’s decision on the Article 8 issue. Later, in giving an overview of his conclusions (at para. 75), the trial judge, in essence, reiterated those respective positions and his concurrence with the Respondents’ position.
13. The trial judge’s commentary following his consideration of the decision in the Delta Pekárny case gives additional insight into his thinking. Having stated that the ECtHR had found that the contested inspection in that case had infringed the right to inviolability of the business premises in question, because the inspection was not open to effective prior or subsequent oversight, he stated (at para. 50) that there is certainly effective prior judicial oversight in this case, although questioning the availability of subsequent judicial oversight. He referred to the financial cost of the proceedings before him as “being enormous and certainly beyond the reach of many, if not most, people who would be subject to a ‘dawn raid’”. Having stated that “a purportedly general remedy that is available to the privileged few and not the less privileged many” is not an effective remedy, the trial judge went on to state (at para. 50):
“Moreover, as will be seen from the reliefs that the court grants later below, while the [Respondents] broadly ‘win’ this case, the reliefs granted to them stop the Commission from doing what it seeks to do, declare that certain contraventions of privacy would arise if this were done, but effectively leave it to the parties to resolve between them how next to proceed. That does not appear to the court to be a fully effective remedy. However, it seems to the court that it is as far as it can go in the context of the reliefs sought by the [Respondents] in these proceedings.”
Later in the judgment, having considered the decision of the ECtHR in the Vinci case, and having referred to the Commission’s contention that the High Court, by way of the application then before it, “was satisfying the requirement as to effective post-search oversight which the European Court of Human Rights apprehends in [the Vinci case]”, the trial judge (at para. 55) referred to what he had already stated in the context of his consideration of the Delta Pekárny case on why, in his view, “there is not, in truth, effective and available post-‘raid’ judicial oversight”.
The Charter
14. Turning to the invocation of the Charter by the Respondents, the trial judge disposed of the arguments advanced by the Respondents that their rights under the Charter would be violated, if the Commission should get to review documents in its possession but which it was not entitled to possess, on the basis that Article 51 of the Charter provides that the provisions of the Charter “are addressed to the . . . Member States only when they are implementing Union law”. Further, he expressed the view (at para. 56) that, in this case, s. 37 is not to be viewed “as a statutory provision that is implementing European Union law”. He concluded that no argument as to the contravention of the Charter could succeed.
Reliefs granted by the High Court
15. In relation to the manner in which the trial judge addressed the reliefs which the Respondents had sought, the position is as follows in relation to the specific reliefs outlined earlier. No declaration was made that the Commission had been in breach of Articles 7 or 8 of the Charter. As regards the declaration sought that, in accordance with s. 3 of the Act of 2003, the Commission had acted in contravention of Article 8, the trial judge stated as follows (at para. 77):
“The court is not satisfied to grant this declaration but considers that were the Commission to proceed as it intends, i.e. to go through all the material it has taken away and determine what is the material that it was entitled to take away, that this would involve such a contravention.”
As regards the claim for injunctive relief, the trial judge reiterated his views as to what the Commission was entitled by law to do when conducting the “dawn raid” at the premises at Platin by reference to the provisions of s. 37. He then stated (at para. 77):
“To the extent that the Commission has seized, and it appears on the balance of probabilities to have seized, materials that fall outside the foregoing, the court is satisfied to grant an injunction restraining the Commission from accessing, reviewing or making any use whatsoever of any such material pending any (if any) agreement as might be reached between the parties to those proceedings, to their mutual satisfaction, whereby a s.33-style or other arrangement is established to sift out that material that ought to have been taken from that which was not.”
Earlier, the trial judge, in giving an overview of his conclusions, had stated (at para. 75):
“. . . there is a perfectly sensible and practically operable process already existing in s. 33 of the Act of 2014 whereby material that is seized and which is claimed to be legally privileged is vetted impartially with a view to determining whether that privilege has been correctly claimed and thus whether the State should view that material or not. It appears to the Court that there is no reason why such a process could not have been voluntarily agreed between the Commission and the [Respondents] in this case.”
The relevant provisions of the order of the High Court appealed against
16. The conclusions of the trial judge were incorporated in an order of the High Court made on 26th April, 2016 and perfected on 6th May, 2016. So far as is relevant to the issues being considered in this judgment, the curial part of the order which reflects the conclusions which have been outlined above contain the following:
The order of the High Court did not record that the declaration sought by the Respondents that the Commission had acted in breach of Articles 7 and 8 of the Charter had not been granted.
The appeal
17. The Commission was granted leave to appeal pursuant to Article 34.5.4° of the Constitution directly from the High Court to this Court on all grounds identified in section 6 of the application for leave by a determination dated 27th June, 2016 ([2016] I.E.S.C.D.E.T. 86). The ground relevant to the remaining issue which is being considered in this judgment is that the High Court erred in holding that there would be a contravention of the right to privacy under Article 8 of the Convention “were the Commission to proceed as it intends, i.e. to go through all the material it has taken away and determine what is the material that it was entitled to take away”. The order which the Commission seeks is an order setting aside the judgment and order of the High Court.
18. The Respondents did not seek leave to cross-appeal in relation to the decision of the trial judge that a declaration sought that the Commission had acted in breach of Articles 7 and 8 of the Charter should not be granted, nor did they seek leave to cross-appeal the limited nature of the declaratory and injunctive reliefs granted by him in relation to the application of Article 8 of the Convention. Accordingly, this judgment will address whether the trial judge was correct in granting the relief he granted on the basis that there would be a contravention of the right to privacy under Article 8 of the Convention in the particular future circumstance he identified and to which the reliefs he granted were tailored, which will be referred to as the Article 8 issue.
Analysis of/discussion on respective positions of the parties on the appeal on the Article 8 issue
Convention: the approach of the Commission
19. On the appeal, the Commission argued that the High Court erred in finding a breach of the right to privacy in Article 8 of the Convention. That argument was preceded by the Commission’s submission that the High Court erred in failing to give a full and proper interpretation of s. 37 of the Act of 2014. In those submissions, the Commission referred to the numerous occasions on which the trial judge characterised the absence of any explicit regulation of the manner in which relevant material was to be disentangled from irrelevant material seized as terra incognita. It was suggested that the trial judge considered that absence as being some kind of legislative oversight, whereas, it was suggested, he should have appreciated that such absence was due to such regulated procedure not being legally required. In order to put that argument in context, it is appropriate to record that it was preceded by consideration of two further grounds on which the Commission alleged the trial judge erred, which reflected the Commission’s perspective as to the principal issues which fall to be determined on the appeal. The first is the correct interpretation of s. 37 of the Act of 2014, arising from the Commission’s contention that the trial judge erred in law in failing to give a full and proper interpretation of s. 37. The second is whether, as contended on behalf of the Commission, the trial judge erred in considering that a process similar to that provided for in s. 33 in relation to privileged legal material ought to be deployed to distinguish relevant material from irrelevant material.
20. In submitting that the trial judge erred in finding that it had been in breach of Article 8, the Commission makes it clear that it is not contending that the Respondents do not have a legitimate interest in the confidentiality and privacy of communications, nor is it contended that the search and seizure of the e-mail account of Mr. Lynch did not amount to an interference with any established rights to privacy. The position of the Commission is that the trial judge failed to properly apply to the Commission, as a public authority, the criteria which arise from Article 8(2), which has been quoted earlier. Underlying that is the contention that the trial judge was wrong in his interpretation of s. 37 in apparently concluding, incorrectly, that the search and seizure was not in accordance with law. More relevant for present purposes is the Commission’s reading of the trial judge’s judgment as concluding that the search and seizure was disproportionate, which view, it is submitted, is not supported by the authorities. It is submitted that different levels of interference with rights under Article 8 of the Convention are tolerated and considered lawful, depending on whether the interference is with private or commercial interests, and whether it is in relation to individuals or undertakings. In the factual scenario in this case, it is submitted that a higher level of interference is lawful as regards the rights of CRH and ICL, which are undertakings, as compared to the rights of Mr. Lynch. However, the Commission emphasises that, although Mr. Lynch is an individual, he was acting in a commercial capacity rather than a private one and, as such, a higher level of interference with his rights under Article 8 is tolerated than if he were acting in a private capacity. It is suggested that the trial judge failed to apply the important distinction between interference with business premises, business transactions and undertakings, on the one hand, and private premises, private communications and individuals, on the other hand, a greater level of legitimate interference being tolerated in relation to the former.
Convention: the approach of the Respondents
21. One aspect of the factual background which emerges as being of particular significance to the submissions being made on behalf of the Respondents is the manner in which, on 14th May, 2015, the Commission accessed and removed electronic files being the property of CRH and of Mr. Lynch (being his ‘crh.com’ e-mail account). The relevant data was stored offsite in a data centre which was hosted by Fujitsu (Ireland) Limited (“Fujitsu”). ICL co-operated with the Commission, which was given access to e-mail files and associated network files of various employees of CRH and ICL, including Mr. Lynch. Access was given via ICL’s network access and the data was copied on to the ICL computers at Platin. Subsequently, forensic copies of the electronic material which became available were made by the Commission. The Respondents’ position is that the copying of material the property of CRH and of Mr. Lynch, which the Commission compelled to be brought on to the premises at Platin, was an interference with the private life, correspondence and home of CRH and of Mr. Lynch.
22. Further, counsel for the Respondents contend that the manner in which the Commission obtained access to material owned by Mr. Lynch and CRH which was irrelevant to the investigation it was conducting was not consistent with s. 3 of the Act of 2003 and Article 8. It is contended that the Commission compelled the transfer of the e-mails from Fujitsu to ICL without any search, following which the e-mails were copied en masse, including e-mails which were not relevant to the investigation the subject of the search warrant, which materials are variously referred to as “irrelevant” or as “out of scope”. Those e-mails were then removed by the Commission from ICL’s premises to be searched by it at a later stage. Arising from the foregoing facts, the real issue is identified by counsel for the Respondents as being whether the Commission was authorised to do what it did, pointing to a range of matters which affect that issue: that what was proposed by the Commission was an unfettered review of the out of scope material; that there is no judicial remedy; and that there is no protection in relation to the out of scope material other than such as is afforded by s. 25 of the Act of 2014. Those matters, it is suggested, also all go to the issue of proportionality.
23. It is implicit in the submissions made on behalf of the Respondents that this Court should not get comfort from an averment in an affidavit of James Plunkett, the ICT Manager of the Commission, which was sworn on 29th January, 2016, to the effect that the approach adopted by the Commission through its digital forensic seizure of data and examinations is guided by that set out in a document entitled “ACPO Good Practice Guide for Digital Evidence” published in March 2012 by the Association of Chief Police Officers in the United Kingdom. In particular, the Court’s attention was drawn to the fact that the document in question refers to the search and seizure of “bulk items”, which is subject to the provisions of a statute in force in the United Kingdom, the Criminal Justice & Police Act 2001, with particular reference to ss. 50(1) and (2) of that Act. The Court’s attention was also drawn to the fact that s. 50 is a provision which creates additional powers of seizure in the United Kingdom legislation, of which there is no analogue here in the Act of 2014 or other legislation, as is the case in relation to certain other aspects of the United Kingdom legislation adverted to by counsel for the Respondents. The Respondents’ position is that, in the absence of such legislative powers in this jurisdiction, the Commission did not have power to do what it did at Platin on 14th May, 2015 and what it did was not in accordance with law.
24. In elaborating on that proposition, counsel for the Respondents drew the Court’s attention to some of those additional powers contained in the United Kingdom legislation. First, for those additional powers, including the power to remove material from the premises, to apply in the United Kingdom, there is a requirement in s. 50(2)(c) that “in all the circumstances it is not reasonably practicable for seizable property to be separated, on those premises, from that in which it is comprised”. Secondly, subs. (3) of s. 50 outlines the factors to be taken into account in considering whether or not the “reasonably practicable” test has been met. Finally, s. 53 imposes duties on the searcher, including the following: to carry out the initial examination as soon as reasonably practicable after the seizure; until such initial examination, to ensure that the seized property is kept separate from anything seized under any other power; to have due regard to the desirability of allowing the person from whom it was seized, or a person with an interest in the property, an opportunity to be present or represented at the examination; and to ensure that the property which it is not entitled to retain is returned as soon as reasonably practicable after the examination of all the seized property has been completed. On the hearing of the appeal, it was suggested on behalf of the Respondents that, even if the Act of 2014 contained provisions equivalent to ss. 50 and 53, they would not have assisted the Commission in that it could not be demonstrated that it was not reasonably practicable during the search at Platin to sift the seizable material from the out of scope material. It is appropriate to observe that this position appears to represent a shift in approach on the part of the Respondents, having regard to the fact that it was averred in an affidavit sworn on 10th February, 2006 by Richard Ryan (Mr. Ryan), a solicitor in Arthur Cox, the solicitors representing the Respondents, who was present at the inspection at the premises in Platin, that “it would have been impractical to carry out a review . . . during the search” of data outside the scope of the search warrant, and also having regard to the position adopted in the letter dated 31st August, 2015 from Arthur Cox referred to later. Accordingly, little weight can be attached to that suggestion.
25. Another factual circumstance which it is suggested goes to the issue of proportionality in this case is that it was at a very late stage in the judicial process that it was first suggested by the Commission that the data seized would not be the subject of a document by document review but that instead it would be subject to a word search to ensure that only documents falling within the search terms are reviewed. This suggestion was made in the second affidavit sworn by Harry O’Rahilly, an authorised officer of the Commission, on 15th March, 2016, the third day of the hearing in the High Court. That approach, it is now suggested on behalf of the Respondents, could have been adopted on the site at Platin in a planned search inspection. Another suggestion made on behalf of the Commission on the hearing of the appeal, that following the word search the out of scope data could be made invisible to the authorised officers, came at an even later stage in the judicial process. Neither suggestion has been pursued by the Commission.
26. That shift in position of the Commission prompts one to ask what was the kernel of the dispute between the parties when the plenary proceedings were initiated and what is the position now. The Respondents co-operated with the Commission in the course of the inspection and did not resist the removal by the Commission of the electronic data removed from the premises of ICL at Platin on 14th May, 2015. Moreover, the Respondents have always acknowledged that much of the electronic data which was seized on that occasion came within the scope of the search warrant. On the other hand, as has been recorded earlier (in para. 6), for the purposes of these proceedings, the Commission accepts that as a matter of high probability not all of the e-mails of Mr. Lynch will relate to the activity under investigation and, thus, are outside the scope of the search warrant. From the outset the Respondents’ objective was to save the electronic data seized by the Commission which was unrelated to the activity under investigation from inspection by the Commission. How it sought to achieve that objective will be considered later. That is still its objective. It is against that background that the application of Article 8 of the Convention and the jurisprudence of the ECtHR and the CJEU to the Respondents’ claim against the Commission will be considered. In short, the factual underlay and the respective positions adopted by the parties have narrowed the Article 8 issue considerably.
Judgments of the ECtHR
27. In relation to the authorities relied on by the trial judge, the Commission attaches most significance to the decision of the ECtHR in the Bernh Larsen case, whereas the Respondents rely on the decisions in the Delta Pekárny case and the Vinci case and also on two decisions of the Court of Justice of the European Union.
28. On 3rd May, 2017, the day before judgments were to be delivered by the Court on this appeal, this Court was informed by the solicitor for the Commission of a recent decision of the ECtHR: Janssen Cilag SAS v. France (Application No. 33931/12) (the Janssen case), in which judgment was delivered on 21st March, 2017 by a committee of the ECtHR composed of three judges. It was suggested on behalf of the Commission that it was appropriate to draw this Court’s attention to that decision having regard to its subject matter and to the consideration by this Court of previous case law of the ECtHR, in particular, the decision in the Vinci case. The Court heard submissions from counsel for the Commission and counsel for the Respondents in relation to the Janssen decision on 4th May, 2017. Since then, the Court has received an unofficial translation of the judgment in the Janssen case, which will be considered.
Bernh Larsen
29. The Commission contends that the trial judge was wrong to conclude that the decision in the Bernh Larsen case did not sufficiently support the Commission’s case that there was no violation of Article 8. In particular, the Commission seeks to demonstrate that there is a material similarity between the facts here and the facts in the Bernh Larsen case, where the public authority in question, a Norwegian tax authority, sought access to and the taking of a full copy of all data contained on a server, which was owned by a separate company and on which several other companies saved their data, which necessarily involved copying materials belonging to other companies, including confidential information, private materials belonging to employees of Bernh Larsen and other companies, and much irrelevant material. The purpose of the search and copying was to find out if Bernh Larsen was in possession of documents that were necessary for a tax audit. In its judgment (at para. 132) the ECtHR accepted the finding of the Norwegian Supreme Court that the archives at issue were not clearly separated but were so-called “mixed archives”, so that it could reasonably have been foreseen that the tax authorities should not have had to rely on the tax subjects’ own indications of where to find the relevant material, but should have been able to access all data on the server in order to appraise the matter for themselves. In the light of that, it was stated (at para. 133) that the national authorities’ and courts’ interpretation and application of the relevant statutory provision “as a provision authorising the taking of a backup copy of the server with a view to inspection at the tax authorities’ premises were reasonably foreseeable by the applicant companies in the circumstances”. The ECtHR then stated (at para. 134) that it was:
“. . . satisfied that the law in question was accessible and also sufficiently precise and foreseeable to meet the quality requirement in accordance with the autonomous notion of ‘lawfulness’ under para 2 of art 8.”
30. The Commission submits that, by analogy, what it suggests is the proper interpretation of s. 37 is accessible, precise and reasonably foreseeable. On that interpretation, it is submitted that it is clear that the power to search and seize records in the investigation being conducted was circumscribed in accordance with its provisions and the Commission did not have an unfettered discretion. The similarity in this case to the facts in the Bernh Larsen case, which the Commission by implication identifies is that, at the time of the search, Mr. Lynch, as an employee of CRH and as, or having been, an employee of ICL, and holding one e-mail account in which materials relating to both roles were stored, as well as private e-mails, held an e-mail account which constituted a “mixed” record. That being the case, it is submitted that it should have been reasonably foreseeable that the Commission, having formed the opinion that there were reasonable grounds for believing that the e-mail account during the relevant period contained information which, in the words of s. 37(1), “may be required in relation to” matters under investigation by it, should have access to the record to obtain the information relative to the investigation. Paraphrasing the terminology used by the ECtHR in the Bernh Larsen case (at para. 132), it is submitted that the Commission should not have had to rely on the Respondents’ indications of where to find the relevant material, but should have been able to access the relevant data in the “mixed record” in order to appraise the matter for itself.
31. The position of the Respondents in relation to the Commission’s reliance on the decision of the ECtHR in the Bernh Larsen case is that it is distinguishable on a number of bases. Most importantly, the only penalties at issue in the Bernh Larsen case were administrative and it did not concern, as here, a search and seizure with potential criminal consequences. This distinction was specifically highlighted in the judgment of the ECtHR (at para. 173) where it was observed that –
“. . . the nature of the interference complained of was not of the same seriousness and degree as is ordinarily the case of search and seizure carried out under criminal law, the type of measures considered by the Court in a number of previous cases (see, for instance, the following cases cited above: . . . Niemietz; Societé Colas Est; . . . and also Robathin v. Austria . . .)”.
Counsel for the Respondents also point to distinguishing features outlined in the commentary on the Bernh Larsen case in a recent academic article (de Jong &Wesseling “EU competition authorities’ powers to gather and inspect digital evidence – striking a new balance”, (2016) 37(8) E.C.L.R. 325-334), where the authors state (at p. 331):
“In Bernh Larsen Holding, the ECtHR ruled that the taking of a mirror copy of a computer server is a particularly far-reaching interference with the principle of proportionality. For this interference to be lawful it will need to be accompanied by effective and adequate safeguards against abuse. In Bernh Larsen Holding this was the case: the authorities followed the sealed envelope-procedure when securing digital data, the company had a right to complain and a representative of the company was invited for the review of the data by the authority.”
None of those safeguards are present in this case. Nor is a further safeguard, which was present in the Bernh Larsen case and to which counsel for the Respondents point as distinguishing it from this case, and which is identified by the ECtHR (at para. 171), where it is stated:
“[A]fter the review had been completed, the copy would either be deleted or destroyed and all traces of the contents would be deleted from the tax authorities’ computers and storage devices”.
In the light of all of the foregoing distinguishing features, it is submitted that it is not the case that the decision in the Bernh Larsen case can be regarded as being authority for the position of the Commission that there has not been a violation of Article 8 in this case. That submission is correct. Having regard to what happened during and following the inspection at Platin, effective and adequate steps were not taken to safeguard the Respondents, in particular, Mr. Lynch and CRH, from abusive interference with their Article 8 rights.
32. It is appropriate to record that, in general, the response of the Commission to the suggestion by the Respondents that the law here lacks effective and adequate safeguards is that s. 37 provides a substantial degree of judicial oversight in requiring that, before an inspection, a warrant be issued by the District Court on foot of evidence on affidavit, and by the judge of the District Court being empowered to specify which of the statutory powers may be exercised in the course of the search. In addition, issues in relation to the validity of the warrant or to the legality of the search conducted pursuant to the warrant are matters which may be the subject of a subsequent legal challenge, and such challenge could be by way of judicial review, or by way of plenary action, as happened in this case, or could be raised in any subsequent trial. It is suggested that the fact of the existence of a review procedure means that there is sufficient oversight and it is irrelevant that the parties seeking to avail of it would require significant resources.
Delta Pekárny
33. While, in support of their contention that there has been a breach of the Respondents’ Article 8 rights, the Respondents contend that their argument is supported by all of the authorities cited in the judgment of the High Court, as noted earlier, they attach most significance to the two most recent decisions of the ECtHR cited by the trial judge: the Delta Pekárny case and the Vinci case. There is no official English translation of either of those judgments and this Court is relying on an unofficial translation in relation to each.
34. The claim in the Delta Pekárny case arose from the imposition by the National Competition Authority in the Czech Republic of a fine on Delta Pekárny for obstructing an investigation being carried out by it, for not allowing it to examine all the electronic data of a business nature in its premises, and for obstructing the inspection of documents which Delta Pekárny contended were private correspondence and unrelated to the subject of the administrative procedure. It is convenient, before outlining the Commission’s view on the relevance of this decision of the ECtHR, to quote from the last three paragraphs of the majority judgment (paras. 92 to 94), where it was stated:
“92. It is true that the inspection in dispute was conducted in the presence of the Applicant’s representatives . . ., that the Authority was not allowed to seize documents and was only given copies . . . and that its officers were bound by the obligation of confidentiality . . .. However, the Court considers that without prior authorisation of a judge, an effective review ex post facto of the need for the measure in dispute and regulation governing the possible destruction of the copies obtained . . ., these procedural safeguards were not sufficient to prevent the risk of abuse of power by the Competition Authority . . ..
93. These elements are sufficient for the Court to conclude that, as happened in this case, the judicial review ex post facto did not provide the Applicant with sufficient safeguards against arbitrariness, so that the interference with its rights cannot be considered to be proportionate to the legitimate purpose sought.
94. There has therefore been an infringement of Article 8 of the Convention.”
35. Counsel for the Commission seek to distinguish the Delta Pekárny case on the basis that the principal ground upon which the ECtHR found that the Czech Competition Authority’s search of a company’s premises was unlawful was that the inspection had been based, not on a formal decision which would have been the subject to judicial supervision, but merely on a general reference to the relevant statutory provisions. It is suggested that a further ground was that there was no ex post facto judicial review. It is in this context that it is submitted by the Commission that, insofar as the trial judge held that the review of the search and seizure conducted by the Commission did not constitute effective ex post facto judicial review, the judgment of the High Court is fundamentally flawed because, as recorded earlier in para. 32, the position of the Commission is that there is a judicial procedure in this jurisdiction for reviewing search and seizure decisions.
Vinci
36. In the Vinci case the relevant French Competition Authority did obtain a decision from a French court authorising it to carry out certain searches and seizures at the premises of several companies in connection with an investigation into prohibited anti-competitive agreements and practices. The premises of the applicant companies were searched approximately three weeks later and numerous documents and computer files and all e-mails of certain employees of the applicant companies were seized. The applicant companies pursued proceedings at national level, first in the court which had authorised the searches, for an order that the searches and seizures were invalid, pointing out that the seizures were undifferentiated and mass seizures carried out in respect of several thousand computer documents and of several employees’ e-mails. A large number of the seized documents it was contended had no connection with the investigation or were protected by the privilege of confidentiality between lawyer and client. Further, it was contended that the seizures were undertaken without a sufficiently precise inventory of seized documents being drawn up. That application was dismissed and an appeal to the Court of Cassation was rejected.
37. The Respondents’ position is that the specific interest of the decision in the Vinci case for present purpose lies mostly in the finding by the ECtHR of a violation of Article 8 of the Convention due to the seizure by the French Competition Authority of the entire e-mail inboxes of the persons concerned. It is true that the ECtHR did conclude that, in accordance with its case law, the measures in question constituted an infringement of the rights guaranteed by Article 8 of the Convention. However, the infringement was in accordance with law. The interference was both in the interest of “the economic wellbeing of the country” and “preventing crime”. That narrowed the application of the relevant principles down to whether the infringement appeared to be proportionate and might be considered necessary to the pursuit of those objectives. The ECtHR concluded that the searches “in themselves” did not appear disproportionate with regard to the requirements of Article 8, but identified the question raised more specifically by the case as relating to the safeguards provided in the national law and formulated the question as follows (at para. 75):
“. . . whether these safeguards were not theoretically and unrealistically applied, but actually and effectively applied, particularly in view of the large number of computer documents and e-mails that were seized, and the greater requirement of respect for the confidentiality of correspondence between lawyer and client.”
In addressing that question, the ECtHR rejected many of the arguments advanced on behalf of the applicant companies. For instance, it concluded (at para. 76) that the seizures could not be considered “mass and undifferentiated”. However it went on to note that it had found that the seizures were carried out in respect of a large number of computer documents, including all professional e-mails of some of the applicants’ employees. It noted that the fact that those documents and e-mails included files and information protected by the confidentiality of the lawyer and client relationship was not in dispute and that the French Competition Authority had indicated that it did not object to the restitution of items protected by professional secrecy. Of course, in this case, because of the protection afforded by s. 33 of the Act of 2014 in relation to legal professional privilege, the Respondents do not have to rely on such a concession being made by the Commission.
38. For present purposes, the core of the decision of the ECtHR is to be found in para. 78 of the judgment, where it stated:
“The Court then observed that, during the conduct of the operations, the Applicants were unable to take note of the content of the seized documents or to discuss the need for them to be seized. However, in the Court’s opinion, unless they were able to prevent the seizure of documents that were unrelated to the investigation or those that were in principle protected by the confidentiality of the lawyer and client relationship, the Applicants had to be able to ensure that the lawfulness of the seizures could be actually and effectively reviewed after they took place. An appeal such as the one available pursuant [to the French Code], should, if appropriate enable them to obtain restitution of the relevant documents or the assurance that these have been [completely] erased, in the case of computer files.”
From the perspective of the Respondents, the reference to “the seizure of documents that were unrelated to the investigation” is of particular significance, the Respondents’ case being that the Commission seized documents belonging to CRH and to Mr. Lynch that were unrelated to the investigation which the Commission was conducting and in respect of which the search warrant had been issued.
39. The ECtHR then went on to identify the flaw in the French legal process which led to the conclusion that there had been a breach of Article 8. While the applicant companies had exercised their right of appeal to the French court which had authorised the French Competition Authority to conduct the searches and seizures in issue, it was stated (at para. 79) that that court –
“. . . contemplating the possibility that the documents retained by the investigators may include correspondence from a lawyer, was content to assess the lawfulness of the context in which the items were seized, without undertaking the necessary examination.”
What the judge should have done was outlined in general terms in the preceding sentence, where it was stated:
“. . . the court considers that it is for the judge who is considering the reasoned allegations that precisely identified documents have been seized despite the lack of connection with the investigation or that they are protected by confidentiality of the lawyer – client relationship, to determine what will happen to these documents after reviewing their proportionality and to order their restitution, as appropriate.”
It was on that basis that the Court found that the seizures carried out at the applicant companies’ premises were, in the circumstances of the case, disproportionate to the purpose and that there had been a breach of Article 8 of the Convention. While the issue raised by the applicant companies in the Vinci case concerned the seizure of information covered by legal professional privilege, as is clear from paras. 78 and 79 of its judgment, the ECtHR regarded the seizure of material unconnected to the investigation as requiring safeguards similar to those required in relation to the seizure of legally privileged material in order to meet the proportionality requirement of Article 8.
40. It is interesting to note that in the judgment in the Vinci case the ECtHR, in addition to considering the domestic law in France, considered European Union law and practice. On European Union law, it considered the practice of the EU Commission on inspections and seizures ordered pursuant to Article 20(4) of Regulation No. 1/2003, referred to later. Of particular relevance for present purposes is that it quoted (at para. 27) from a judgment of the General Court of the European Union dated 14th November, 2012 in Case T – 140/09, which, although it is not named in the translation of the judgment before this Court, was Prysmian and Prysmian Cavi e Sistemi Energia v. The Commission (the Prysmian case). The portion of the ruling of the General Court quoted, referred to as being points 62 and 63, is obviously replicated in the judgment of the General Court, which was delivered on the same day, in the Nexans case referred to later, where it is stated:
“64. . . . when the [EU] Commission carries out an inspection at the premises of an undertaking under Article 20(4) of Regulation No. 1/2003, it is required to restrict its searches to the activities of that undertaking relating to the sectors indicated in the decision ordering the inspection and accordingly, once it has found, after examination, that a document or other item of information does not relate to those activities, to refrain from using that document or item of information for the purposes of its investigation.
65. . . . if the [EU] Commission were not subject to that restriction it would in practice be able, every time it had indicia suggesting that an undertaking has infringed the competition rules in a specific field of its activities, to carry out an inspection covering all those activities, with the ultimate aim of detecting any infringement of those rules which might have been committed by that undertaking. That is incompatible with the protection of the sphere of private activity of legal persons, guaranteed as a fundamental right in a democratic society.”
41. Further, in considering the practice of the EU Commission on inspections, the ECtHR referred to and summarised the content of a revised note published on 18th March, 2013 by the EU Commission entitled “Explanatory note to an authorisation to conduct an inspection in execution of a Commission decision under Article 20(4) of Council Regulation No. 1/2003” as to how the investigations of the EU Commission should proceed, which will be referred to as “the Explanatory Note” when considered later.
42. The references by the ECtHR to the judgment of the General Court in the Prysmian case and to the Explanatory Note highlight the connection between the jurisprudence of the courts of the European Union and the ECtHR in relation to searches and, in particular, searches and seizures in the context of the application of competition law. Counsel for the Commission put before this Court a document entitled “ECN Recommendation on the power to collect digital evidence, including by forensic means”, which will be referred to as “the ECN Recommendation” when considered later. “ECN” is an abbreviation of the European Competition Network. A disclaimer at the foot of the document makes it clear that it does not create any legal rights or obligations or give rise to legitimate expectations on the part of any undertaking or third party. Nonetheless, its importance is that it highlights the connection between the jurisprudence of the two regimes, the Convention, and EU law, and also with the relevant national law. In paragraph 6 it is stated:
“The exercise of the powers outlined in this Recommendation should be in accordance with the general principles of EU law (such as the principle of proportionality, respect for the rights of defence and legal certainty), the rules and principles of international law, as well as the observance of fundamental rights, including those enshrined in the Charter of Fundamental Rights of the European Union and the European Convention on Human Rights where applicable. Such safeguards should also include the respect of the relevant legislation and case law on Legal Professional Privilege and the processing of personal data, as interpreted under the law of the respective ECN jurisdiction.”
While the ECN Recommendation (at para. 9) emphasises the importance that the effectiveness and efficiency of the procedures for gathering digital evidence is ensured and, in particular, the desirability of a National Competition Authority having a “continued inspection procedure”, nothing in it regulates the rights and obligations of the Commission to the Respondents or vice versa in the circumstances of this case. It does, however, provide guidance.
43. The interpretation by counsel for the Commission of the judgment of the ECtHR in the Vinci case, based on the last sentence in para. 78 of the judgment quoted earlier, is that the ECtHR concluded that, if the remedy under the French Code had been properly applied by the judge, there would have been no problem, but it was not so applied. It is commented that, significantly, the judgment of the ECtHR says nothing whatsoever about whether a national authority is empowered to undertake the preliminary step of the seizure and review of documents, in circumstances where that search and seizure is an absolutely necessary step in the process of seizing and reviewing records containing information which may be required in relation to the matter under investigation by that authority. As I understand it, that observation embodies the assumption that the national authority is so empowered and that it may then either facilitate the recovery or the deletion of the documents in question, which it is suggested was anticipated by the ECtHR in Vinci, presumably, by reference to the last sentence in para. 78. If that amounts to a concession on the part of the Commission very little weight can be attached to it, as the Commission, as will be demonstrated later, unequivocally rejected the process proposed by the solicitors for the Respondents for identifying the unrelated digital material which had been seized by it and the various steps proposed to protect the right of privacy of CRH and Mr. Lynch under Article 8.
Janssen
44. The similarity between Janssen and Vinci is that in both cases the inspections and seizures at the premises of the relevant applicants were authorised by a French court, in particular, pursuant to Article L. 450 – 4 of the French Commercial Code. Approximately two weeks after the search of the premises of Janssen by the French Competition Authority, it applied to a different French court for the inspections and seizures to be declared invalid. In the unofficial translation of the judgment of the ECtHR that was provided to the Court the ECtHR recorded (at para. 6) that the French court annulled the seizure of three files in respect of which neither the inventory nor the report drawn up by the investigators provided a means for checking that the files contained documents relating to the authorisation which had been granted. In paragraph 7 of the judgment, the ECtHR outlined a factual scenario to which counsel for the Commission attach significance. It is stated:
“However, the judge declared the remainder of the inspections and seizures lawful. Concerning the seizure of documents covered by the secrecy of correspondence, the Court held as follows: that the sole fact that part only of a mailbox may contain elements falling within the scope of the court authorisation is sufficient for the seizure to be valid in its entirety, and the seizure of documents that are personal or extraneous to the operation should not invalidate such seizure; that a DVD containing a copy of all the electronic documents, which were then seized and placed under seal, had immediately be given to the Applicant; and that the absence of any precise identification by the Applicant of a protected document, a mere reading of the names of the seized documents did not reveal that they obviously contained protected elements; that the Applicant had not indicated the number of protected documents, this time in hard copy, even though this could be constituted evidence of a failure by the authority both in the discharge of its duty of loyalty and in the alleged lack of proportion between means deployed and the necessary protection of fundamental rights; that, as such, it was for the Applicant and other interested persons to identify the documents that they considered to be protected by the secrecy of private correspondence or legal professional privilege, or to be outside the scope of the authorisation, and to request their return from the authority. The judge then confirmed to the authority his agreement to the return of those documents.”
It would seem that the national judge in Janssen did what the ECtHR in Vinci considered should have been done by the national court in that case, as recorded earlier at para. 39. An appeal by Janssen to the Court of Cassation was rejected.
45. On the basis of the foregoing factual situation, the ECtHR considered the claim based on Article 8 of the Convention. As happened in Vinci, the Court considered that the inspections and seizures constituted an interference with the rights guaranteed by Article 8, but that such interference was “in accordance with law” and that it had a legitimate purpose. The Court also recorded (at para. 19) that in Vinci it was highlighted that, where a judge hears allegations that precisely identify documents have been seized despite being unconnected to the investigation or covered by the confidentiality of lawyer and client relations, it is for the judge to determine what is to happen to such documents, following an effective review as to proportionality and, as the case may be, order their restitution. The ECtHR found that the French judge at first instance not only effectively examined Janssen’s allegations, but also expressly pointed out the absence of any precise identification by Janssen of a protected document or even an indication as to the number of protected documents, even though this could have provided an indication of a failing on the part of the Competition Authority in discharging its duty of loyalty and in the alleged disproportion between the means implemented and the necessary protection of fundamental rights. The ECtHR went on to say (at para. 23):
“The Court therefore notes that in this instance, unlike the case in Vinci . . ., the domestic judge, . . . having declared that the seizure of three files was invalid . . ., effectively undertook a review of proportionality as required by the provisions of Article 8 of the Convention, on the one hand, whereas the Applicant, on the other hand, had not referred to it the allegations that the documents which it had precisely identified were wrongly seized. The Court notes furthermore that it remained possible for the Applicant to identify the documents in dispute in order to then claim their restitution by the authority, and the judge even noted his approval in his order to this effect. In this regard, the Court points out that an application such as the one available under Article L. 450 – 4 . . . allows for restitution where appropriate of the relevant documents or the guarantee that they will be deleted in full in case of copies of computer files (Vinci . . . para. 78). It follows from these elements, that in this instance, the safeguards were practically and effectively applied, and were not just theoretical and illusory.”
On the foregoing basis, the ECtHR considered that the application under Article 8 was unfounded and must be rejected.
46. Counsel for the Commission emphasise that in Janssen the applicant had not identified any protected documents which it contended had been wrongly seized, that is to say, any particular documents which interfered with private rights. It is suggested that the position is the same in this case in that the Respondents had not precisely identified the documents which they alleged were wrongly removed from the Respondents’ premises at Platin. Counsel for the Respondents, on the other hand, in reliance on para. 23 of the judgment, point out that it had been found that Article 8 had been complied with. There had been a review by the French judge which was proportional. There was a return of documents. The procedure under the French Code provided for the return of unrelated documents. Counsel for the Respondents submit that the provisions of the French Code are the material point of difference between the Janssen case and this case. It is suggested that the process under French law at issue in Janssen guaranteed the conduct of a concrete review.
Judgments of the Court of Justice of the European Union
47. In the context of their submissions on the application of Article 8 of the Convention to this case, counsel for the Respondents refer to the practice of the EU Commission during “dawn raids” and the relevant judgments of the Court of Justice of the European Union (“CJEU”), stating that in the High Court they referred the Court to these matters, although they are not alluded to in the judgment of the High Court. The powers being exercised by the EU Commission considered in the authorities on which the Respondents rely are the powers conferred by Article 20 of Council Regulation (EC No. 1/2003) of 16 December, 2002 on the implementation of the rules on competition laid down in Articles 81 and 82 of the Treaty (“the 2003 Regulation”). The 2003 Regulation now regulates the implementation of the rules on competition laid down in Articles 101 and 102 of the Treaty on the Functioning of the European Union (“TFEU”). The authorities on which the Respondents rely are:
As counsel for the Respondents place considerable reliance on those authorities, I consider that it is necessary to consider them in some depth.
48. Before so doing, it is appropriate to explain why those authorities are of relevance to the application of competition rules founded on statutory provisions of national law, for example, the provisions of the Act of 2002 and the Act of 2014 and to the particular context of the inspection by the Commission at ICL’s premises at Platin, which the evidence establishes was for the purpose of obtaining information in relation to an investigation concerning alleged conduct or behaviour amounting to –
As noted in Andrews, Gorecki and McFadden on Modern Irish Competition Law (Dublin, 2015, Wolters Kluwer), at page 2, judgments of the CJEU and of the General Court of the European Union strongly influence interpretation of national rules on competition law. In delivering judgment in this Court in Hemat v. Medical Council [2010] 3 I.R. 615 (“the Hemat case”), an appeal on the application of competition rules, in explaining why he proposed to examine, in the first instance, the decisions of the European Court of Justice, Fennelly J. stated (at para. 41):
“It is patent that the Oireachtas has used the language of Articles 81 and 82 TEC [now 101 and 102 TFEU] in ss 4 and 5 of the [Act of 2002]. Accordingly, the judgments of the Court of Justice must be taken as authoritative in the interpretation of notions such as ‘undertaking’ and ‘association of undertakings’, which are fundamental to the operation of both the Treaty articles and the [Act of 2002].”
As Fennelly J. observed earlier (at para. 27), having stated that the matter before the Court must be considered entirely within the ambit of national competition law, and having stated that the relevant provisions of the Act of 2002 are closely modelled on the corresponding articles of the Treaty, “the case law of the European Court of Justice provides important guidance”.
Nexans
49. The judgment of the CJEU on the appeal from the General Court in the Nexans case is the appropriate starting point as it contains a useful summary of the background to, and the proceedings before, the General Court. By the decision in issue the EU Commission had ordered the applicant companies, which will be referred to as “Nexans”, and all companies directly or indirectly controlled by them to submit to an inspection in accordance with Article 20(4) of 2003 Regulation. By the application to the General Court Nexans sought the annulment of the decision at issue and of acts taken by the EU Commission during the inspection and also requested that the General Court order measures against the EU Commission in the event that the decision at issue and the acts taken by the EU Commission during the inspection concerned should be annulled. The basis on which Nexans supported their application in the General Court is recorded as follows in the judgment of the CJEU (at para. 6):
“In support of their application, the appellants raised a single plea, alleging infringement of Article 20(4) of Regulation No 1/2003 and of fundamental rights, namely: the rights of the defence, the right to a fair trial, the privilege against self-incrimination, the presumption of innocence and the right to respect for privacy. By that plea, divided into two parts, the appellants criticised the [EU] Commission, first, for the overly broad and vague range of products covered by the decision at issue and, secondly, for the overly broad geographical scope of that decision.”
Nexans were successful on the first part of their plea, namely, as to the product scope of the inspection, in that the General Court (at para. 91) found that the EU Commission had not demonstrated that it had reasonable grounds for ordering an inspection covering all electric cables and the material associated with those cables, as distinct from only high voltage underwater cables. The second part of the plea, that the decision of the EU Commission had an overly broad geographical scope, had been rejected by the General Court (at para. 100) and it was that decision which was under appeal to the CJEU. The judgment of the CJEU also recorded that the General Court dismissed as inadmissible the application for annulment of the acts taken by the EU Commission during the inspection.
50. The CJEU rejected the appeal by Nexans on the ground that geographical scope of the decision of the EU Commission was overly broad and vague. In considering that ground by reference to an argument by Nexans that there was infringement of the requirements to state reasons concerning the geographical scope of the decision, in the passages on which counsel for the Respondents rely, the CJEU outlined the rationale for the obligation imposed on the EU Commission under Article 20(4) of 2003 Regulation to state specific reasons as follows (at para. 34):
“That obligation to state specific reasons constitutes, as the Court of Justice has made clear, a fundamental requirement not only to show that the intervention envisaged within the undertakings concerned was proportional, but also to put those undertakings in a position to understand the scope of their duty to co-operate, while at the same time preserving their rights of defence . . .”
By way of explanation of the outcome of that part of the appeal, the CJEU stated (at para. 36) that, although, admittedly, the EU Commission is obliged to indicate as precisely as possible the evidence sought and the matters to which the investigation must relate, it is not essential in a decision ordering an inspection to define precisely the relevant market, to set out the exact legal nature of the presumed infringements or to indicate the period during which those infringements were committed, provided that the inspection decision contains the essential elements. It rejected that part of the appeal, having stated that the General Court was able to conclude that the statement of reasons in the decision at issue concerning the geographical scope of the suspected infringement was sufficient.
51. Turning to the judgment of the General Court in the Nexans case, on which counsel for the Commission place much reliance, on the first ground on which Nexans were successful, namely, the contention that the product scope of the inspection decision was overly broad and vague, the General Court made some preliminary observations. These included the observations in para. 39, which are quoted in the judgment of Charleton J. (at para. 44), which are reflected in the statement in the judgment of the CJEU (at para. 34) quoted in the next preceding paragraph. The General Court went on to emphasise (at para. 40) that the need for protection against arbitrary or disproportionate intervention by public authorities in the sphere of private activities of any person, whether natural or legal, constitutes a general principle of EU law, as laid down in Article 7 of the Charter, under which “[e]veryone has the right to respect for his or her private and family life, home and communications”. It was against the background of those observations that the General Court then went on to consider the argument advanced on behalf of Nexans that the high voltage underwater cables sector was the only sector in relation to which the EU Commission had reasonable grounds for suspecting an infringement of the competition rules on the part of Nexans, which resulted in the finding of the General Court (at para. 91) that the EU Commission had not demonstrated that it had reasonable grounds for ordering an inspection covering all electrical cables and materials associated with those cables. That finding was not appealed.
52. One of the claims advanced on behalf of Nexans before the General Court, apart from the claim that the inspection decision be annulled, which is the focus of the analysis by counsel for the Commission of the decision of the General Court, was for a declaration that the EU Commission’s decision to remove copies of certain computer files and the hard drive of a computer of a Mr. C at Nexans premises for review at its offices in Brussels later was unlawful. Nexans also sought annulment of certain acts of the EU Commission in relation to Mr. C. and, specifically, sought an order that the EU Commission refrain from using, for the purposes of the proceedings in respect of an infringement of the competition rules, any documents or evidence which it might have obtained pursuant to the annulled decisions. The General Court (at para. 134) declared that the applications for annulment of those contested acts were inadmissible. There was no appeal to the CJEU against that declaration.
53. It was in the course of the General Court’s analysis of Nexans arguments’, as recorded at para. 118, that the contested acts had brought about a significant change in their legal position and had seriously and irreversibly affected their fundamental rights – their right to privacy and the rights of the defence – so as to render the contested acts challengeable measures, that the General Court made the observations at para. 130, which are quoted by Charleton J. in his judgment (at para. 46) and which I consider it unnecessary to reiterate. The General Court found that the contested acts could not be regarded as actionable measures and went on to state:
“132. . . . The legality of those acts could only be examined – apart from in the context of an action for annulment of the decision imposing a penalty . . . – in the context of an action challenging the final decision adopted by the [EU] Commission under Article 81(1) EC. Review by the Courts of the way in which inspection was conducted falls within the scope of an action for the annulment of the final decision adopted by the [EU] Commission under that provision . . .
133. Moreover, if the applicants believe that the acts by which the [EU] Commission took a copy of several computer files and of the hard drive of Mr. C’s computer in order to examine them later in its offices and requested from him explanations of documents found during the inspection are illegal and have caused them to suffer such as to cause the European Union to incur liability, they may bring an action against the [EU] Commission for non-contractual liability. A remedy of that kind is not part of the system for the review of the legality of acts of the European Union which have legal effects binding on, and capable of affecting the interests of, the applicant, but it is available where a party has suffered a harm on account of unlawful conduct on the part of an institution . . .”
54. It is worth recording that those observations in paras. 132 and 133 were preceded by a statement (at para. 129) that Nexans did not claim that the documents copied by the EU Commission were eligible, under EU law, for protection similar to that conferred on the confidentiality of communications between lawyers and their clients, so that the EU Commission, when it decided to copy those documents, did not adopt a decision withholding that protection from Nexans. Of course, in this case, the Respondents had, and still have, the protection of s. 33 of the Act of 2014.
55. There are aspects of the decision of the General Court in Nexans which counsel for the Commission suggest are relevant to the application of Article 8 to the Respondents’ claim in this case. First, it is suggested that what the General Court stated at para. 130 (as quoted by Charleton J. in his judgment at para. 46) is particularly relevant, the issue being addressed being similar to the issue which arises here. Secondly, as regards the outcome of the claim before the General Court for the annulment of certain acts of the EU Commission in relation to Mr. C., it is emphasised that the General Court held that the legality of the measures implementing the inspection decision, for example, copying documents, cannot be examined except in the context of challenging the final decision adopted by the EU Commission, in relation to which, it is suggested, the General Court adopted an approach similar to the approach adopted in this jurisdiction in Byrne v. Grey [1988] I.R. 31, referred to by Charleton J. in his judgment (at para. 5). Thirdly, the General Court had regard to Article 7 of the Charter. Having regard to all of those factors, it is suggested by counsel for the Commission that the reliance by the Respondents on the decision of the ECtHR in Vinci as supporting their claim that the Commission is in contravention of Article 8 is misplaced. As will appear later, I do not consider that the reliance by the Respondents on the decision in the Vinci case is misplaced. It is necessary to comment, however, on the second factor. In the Nexans case the General Court (at paras. 115 to 134) was addressing the admissibility of the application for annulment of the contested acts and it was concerned with the enforcement of competition law under EU law in the context of Article 81 (EC), now Article 101 of TFEU, and of the 2003 Regulation and in the overall context of EU competition law, and, specifically, the application of Article 230 (EC), now Article 263 of TFEU, which was expressly addressed by the General Court (at paras. 115 and 136). In contrast, this Court is addressing the Respondents’ claim in the context of the remedies available under Irish law and this judgment concerns only the remedies available to the Respondents for a contravention of Article 8 of the Convention under Irish law. Accordingly, that aspect of the decision of the General Court seems to me to be of no relevance whatsoever and the Commission’s reliance on the judgment of the General Court turns out to be something of a “red herring”.
Deutsche Bahn
56. The judgment of the CJEU in the Deutsche Bahn case relied on by the Respondents was on an appeal from the General Court by Deutsche Bahn and its subsidiaries seeking to set aside the judgment of the General Court dismissing an action by Deutsche Bahn for annulment of three decisions made by the EU Commission under Article 20(4) of the 2003 Regulation ordering Deutsche Bahn to submit to three separate inspections which took place in the presence of Deutsche Bahn’s lawyers and in respect of which Deutsche Bahn had not raised objections or complaints about prior lack of judicial authorisation.
57. The first ground of appeal advanced on behalf of Deutsche Bahn was that there had been misinterpretation and misapplication by the General Court of the fundamental right to the inviolability of the home provided for in Article 7 of the Charter and Article 8 of the Convention. In setting out its findings on this ground, the CJEU stated (at para. 20) that, although it is apparent from the case law of the ECtHR that the protection provided for in Article 8 of the Convention may extend to certain commercial premises, the fact remains that that Court did hold that interference by a public authority could go further for professional or commercial premises or activities than other cases, citing, inter alia, the Bernh Larsen case.
58. Following its analysis of the judgment of the General Court, the CJEU found that the General Court was correct in finding that the fundamental right to inviolability of private premises, as protected by Article 8 of the Convention, is not disregarded by there being no prior judicial authorisation and, accordingly, it concluded that no infringement of Article 7 of the Charter had been established. Of course, s. 37 of the Act of 2014 does provide for prior judicial authorisation in this jurisdiction. In its analysis, the CJEU made the following statement (at para. 31), which is relied on by counsel for the Respondents:
“. . . it is settled case-law that the [EU] Commission’s powers of investigation are strictly defined, encompassing inter alia the exclusion of non-business documents from the scope of the investigation, the right to legal assistance, the preservation of the confidentiality of correspondence between legal counsel and clients, the obligation to state reasons for the inspection decision and the option of bringing proceedings before the EU courts . . .”
59. The second ground of appeal advanced by Deutsche Bahn was that there had been misinterpretation and misapplication by the General Court of the right to effective judicial protection provided for in Article 47 of the Charter and Article 6(1) of the Convention. Article 6 of the Convention has not been invoked by the Respondents in this case. In any event, the CJEU held that the General Court was correct in holding that the right to effective judicial protection, as guaranteed by Article 6(1), is not disregarded by there being no prior judicial review and, noting that that fundamental right constitutes a general principle of EU law, as currently expressed in Article 47 of the Charter, it held that no infringement of Article 47 had been established.
60. The third ground of appeal advanced on behalf of Deutsche Bahn was that there had been an infringement of the rights of the defence due to irregularities vitiating the conduct of the first inspection. The CJEU found that that ground of appeal was admissible and went on to consider the merits. The finding on the merits was that the first inspection was vitiated by irregularity since the agents of the EU Commission, being previously in possession of information unrelated to the subject matter of that inspection, proceeded to seize documents falling outside the scope of the inspection as circumscribed by the first contested decision. It was also held that the second and third inspection decisions should be set aside on the grounds of infringement of the rights of the defence.
61. Having found that the third ground of appeal was admissible, in dealing with the merits, the CJEU, citing, inter alia, para. 34 from its judgment in the Nexans case quoted earlier, in a passage to which counsel for the Respondents point, stated (at para. 56):
“As to the merits, it must be borne in mind that Article 20(4) of Regulation No 1/2003 requires the [EU] Commission to state reasons for the decision ordering an investigation by specifying its subject-matter and purpose. As the Court has held, this is a fundamental requirement, designed not merely to show that the proposed entry onto the premises of the undertakings concerned is justified but also to enable those undertakings to assess the scope of their duty to cooperate whilst at the same time safeguarding their rights of defence . . ..”
62. Counsel for the Respondents also emphasise the succeeding paragraphs of that judgment (paras. 57 to 60) in which the CJEU, inter alia, itemised further constraints on the EU Commission, namely:
(a) that information obtained during the investigations must not be used for purposes other than those indicated in the inspection warrant or decision;
(b) that such a requirement is aimed at preserving, in addition to business secrecy, undertakings’ rights of defence, which Article 20(4) is intended to safeguard, it being stated that those rights would be seriously endangered if the EU Commission were able to rely on evidence against undertakings which was obtained during the investigation but was not related to the subject matter or purpose thereof; and
(c) that the EU Commission is required to state reasons for its decision ordering an inspection and, if the statement of reasons for that decision circumscribes the powers conferred on the EU Commission’s agents, a search may be made only for those documents coming within the scope of the subject matter of the inspection.
63. While there is guidance for this Court in the judgment of the CJEU in the Deutsche Bahn case, it must be borne in mind that the function of this Court on this appeal is to apply national law, primarily the relevant provisions of the Act of 2002 and of the Act of 2014 and, in particular, the powers conferred on authorised officers under s. 37 of the Act of 2014. Further, the function of this Court is to apply national law in the context of the factual basis of the Respondents’ claim and the dispute between the parties. Notwithstanding that, it is of assistance to consider the commentary by practitioners and academics in very recent articles on the recent authorities cited by the parties, which have been brought to the attention of the Court and which are material to understanding the relevance of the recent case law of the ECtHR and the CJEU to the function of this Court on the appeal.
Practitioner/academic commentary
64. An article by Goffinet & Bontinck entitled “The ‘Tangible’ Examination of Inspections and Seizures: A Requirement After the ECtHR Vinci Judgment?” (published in the Journal of European Competition Law and Practice 2016, Vol. 7, No. 4, pages 243 to 253), as the title indicates, contains an analysis of the decision of the ECtHR in Vinci, which was the first time the ECtHR ruled on a seizure which was carried out by investigators of a National Competition Authority. The authors describe the judgment in the Vinci case as having brought a new element to the protection under Article 8 of the Convention. The authors also consider the best practices of the EU Commission, referring to the revised version of the Explanatory Note considered by the ECtHR in the Vinci case, which was revised in September 2015, and also the ECN Recommendation adopted in December 2013. Their conclusion as to the consequences of the Vinci judgment (at p. 253) is as follows:
“Although it does not directly impede the seizure of complete e-mail accounts, it can be argued that the Vinci judgment imposes indirectly an obligation on the European National Competition Authorities to be precise, circumscribed and proportionate in the volume and subject matter of their seizures. Indeed, the ECtHR requires that the reviewing judge must carry out a ‘tangible’ ([i.e.] concrete and factual) examination of the seizures to determine whether the documents fall outside the scope of the investigation or under [legal professional privilege]. In other words, if the seizures are not precise, circumscribed, and proportionate in their volume and subject matter, the reviewing judge will not be able to carry out a tangible examination of the seizures and there will be accordingly a violation of Article 8 of the [Convention].”
As regards the terminology in the second sentence in that passage, which is obviously intended to reflect what is stated in the judgment of the ECtHR at paras.75, 78 and 79, in particular, this is to say, the reference to a “tangible” (i.e. concrete and factual) examination”, it appears to reflect some disparity between the translation before this Court and the authors’ translation. In the interests of clarity it is to be noted that the authors use similar terms in identifying the question posed by the ECtHR in para. 75 of the judgment, which is quoted earlier, stating (at p. 247) that the relevant question was to determine whether the “safeguards had been applied in a manner that was concrete and effective rather than theoretical and illusory”. The authors go on to say that the best practices as developed by the EU Commission enable the competent judge to review tangibly the seizures of documents. They also state that the best practices developed in Belgium and the Netherlands also show that the idea is to obtain a final selection of documents (through key words and through an individual and manual review of the content of documents in the presence of the targeted company) with regard to which a judge can carry out tangible examination.
65. The commentary to which most significance is attached by counsel for the Respondents is the article by de Jong & Wesseling referred to earlier (at para. 31). In that article, the authors compare the EU Commission approach to digital investigations, which is referred to as the model of “on-site” selection, with the “off-site” selection model which is followed in the Netherlands by the National Competition Authority. In doing so, they point out that, in consequence of the fact that the ground of appeal relating to the legality of continued inspection-procedure was declared inadmissible by the General Court in the Nexans case, neither the CJEU nor the General Court has so far had the opportunity to rule on the legality of the approach where a copy of digital data is taken to the EU Commission’s premises in a sealed envelope.
66. What is of particular relevance for present purposes is the authors’ exposition of concerns with regard to the legality of the off-site selection procedure. They question (at para. 4.2) whether the off-site selection model sufficiently guarantees the rights of defence of the company that is subject to the investigation, these rights including the principle of proportionality and the company’s right to privacy, but also the protection of legally privileged data. It is in the context of discussing the proportionality of the inspection and the company’s right to privacy that (at para. 4.2.1) they make the observations about the Bernh Larsen case quoted earlier (at para. 31). They follow those observations by pointing out that in the Vinci case the ECtHR ruled that the French Competition Authority had violated the applicant companies’ rights to privacy since it was not proportional, observing that it seized entire e-mail boxes of certain employees, and that the applicant companies were not able to prevent the collection of data that was out of scope or that was legally privileged. They then state:
“According to the ECtHR this meant that the company should be able to have the seizure of the data effectively reviewed ex post. More particularly, a national court will need to actually review the specific documents of which it is claimed that they are out of scope or legally privileged. As the French court had not engaged in such an actual and effective review, the ECtHR concluded that the inspection was disproportional and a violation of art. 8 . . .”
Interestingly, the authors also refer to the judgment of the High Court in this case. They go on to say that, if an authority adopts the off-site selection model, concerns about compatibility with the principle of proportionality can be taken away if there are sufficient safeguards in place, suggesting that these could be provided by following a sealed envelope-procedure, by allowing the company’s representatives to be present during the search of the copy data, and having an effective actual ex post right to appeal.
67. While I consider that the existence of s. 33 of the Act of 2014 renders it unnecessary to consider the authors’ observations on legal professional privilege and the protection of attorney-client relationship, it is instructive to take account of what they have to say about the safeguards which should be in place to protect fundamental rights in the off-site selection of digital data, such safeguards being in place to cover both irrelevant material and legally privileged material. In this context, they state that, first, it is important to ensure that the authority will not review any data that is included in the secured (i.e. seized) dataset, but to which it is not entitled because it is irrelevant to the investigation. They suggest that an efficient and effective way to ensure this is by putting a sealed envelope-procedure in place, as is done by the EU Commission, so that the digital dataset can only be taken out of the envelope in the presence of the company’s representative, who should also have the right to be present during the whole selection procedure. It is suggested that when an authority adopts the off-site selection model it is important to put these two safeguards in place, so that the company can check which data is examined by the authority’s officials and it is able to effectively exercise its right of defence. They state that, secondly, when the authority proceeds with the investigation by applying search terms to the dataset, it will need to ensure that it only selects data that is actually relevant to the investigation. They refer again to the statement by the trial judge in the High Court judgment in this case that there is no reason why an already existing “perfectly sensible and practically operable process”, being a reference to s. 33 of the Act of 2014, could not be applied to exclude material that is out of the scope of the investigation. They make the point, thirdly, that it is essential that a company which is subject to an inspection has an effective right to appeal against any irregularities that have occurred during the inspection, emphasising that this means that the company must have a right to an actual and effective review of the legality of the seizure of the data and that it should be able to have illegally seized data returned or erased, citing the decision of the ECtHR in the Vinci case. Finally, they add that, also, in order to safeguard an effective right of ex post judicial review, it is important that the company is present during the securing, collection and selection of digital data by the authority. Starting with the sealed envelope procedure, none of those safeguards was in place to enable the Respondents to exercise their right of defence when the electronic data was removed by the Commission from Platin. Further, in the High Court and on this appeal, the Commission simply resisted the granting of any relief to the Respondents which would rectify those deficiencies and protect the Respondents’ right to privacy.
Conclusions on the Article 8 issue
68. It is important to recall that the trial judge did not find that, in accordance with s. 3 of the Act of 2003, the Commission had acted in contravention of Article 8 of the Convention at the point in time when he made his decision. He merely found that there would be a contravention were the Commission to proceed, as he correctly considered it intended, to access, review and make use of the material seized by it and taken offsite. Accordingly, the core issue on the appeal on the application of Article 8 is whether, by taking those intended steps, which, in consequence of the injunction granted by the trial judge it is currently restrained from taking, the Commission would be acting in contravention of Article 8. For the purposes of this appeal, that issue must be determined having regard to the circumstances outlined earlier (in para. 26) and, in particular, to the acknowledgement by the appellant that, as a matter of high probability, not all of the electronic material it has seized and is now in its possession relates to an activity under investigation by it, so that it is not within the scope of the search warrant which it obtained under s. 37 of the Act of 2014.
69. It is also important to recall what was the kernel of the dispute between the parties which led to the proceedings in the High Court. As is clear from the affidavit evidence which was before the High Court, ICL, whose solicitors were present in the Platin premises during most of the period of the inspection which resulted in the search and seizure, co-operated with the Commission and it was with such co-operation that the Commission obtained the electronic data which it now holds. As regards privileged legal material which was included in the seized electronic data and which was protected by s. 33 of the Act of 2014, it was agreed between the parties that such material would be dealt with by subsequent correspondence between the parties. That occurred, in accordance with the provisions of s. 33, and no issue arises in these proceedings in relation to privileged legal material. The issues which arise relate to seized electronic data, some of which being in Mr. Lynch’s e-mails, which the Respondents contend was outside the scope of the search warrant. As regards that out of scope data, from the outset, ICL’s solicitors, Arthur Cox, sought to enter into an appropriate arrangement with the Commission in relation to review of the electronic data seized by the Commission and removed from the premises at Platin and to deal appropriately with the electronic data which would be found to be outside the scope of the search warrant. In fact, the trigger for these proceedings was the response of the Commission to a process proposed by Arthur Cox in a letter dated 31st August, 2015 as to how such an arrangement might be achieved.
70. However, given the significance which counsel for the Commission attach to the decision of the ECtHR in Janssen, and, in particular, the suggestion that this case is analogous to the Janssen case in that, it is contended, the Respondents did not precisely identify any protected documents which had been seized, it is necessary to outline in detail the interaction between the Respondents and their solicitors, Arthur Cox, on the one hand, and the Commission, its officers and its legal adviser, on the other hand, during and after the inspection at the Platin premises until the initiation of these proceedings in the High Court.
71. The starting point is what is averred to in affidavits by Patrick O’Brien (“Mr. O’Brien”), a solicitor in Arthur Cox, in his affidavit sworn on 10th February, 2016 and by Mr. Ryan. Mr. O’Brien averred that, during the inspection he and Mr. Ryan informed Mr. William Fahy (“Mr. Fahy”), the authorised officer named in the search warrant, that Mr. Lynch was no longer employed by ICL but was employed by CRH and, as a result, his mailbox included documents that did not relate to ICL and that those documents were outside the scope of the search warrant. The purpose of the discussion was to put Mr. Fahy and the Commission on notice of the issue. It would have been impracticable to carry out a review of the data for the purposes of identifying the documentation concerned during the search. Given that it had been agreed that the issue of legal privilege would be raised in correspondence with the Commission and that it had been confirmed to Mr. Ryan that the Commission would not review any of the seized documentation pending resolution of the issue of legal privilege, Mr. O’Brien and Mr. Ryan decided to raise the issue in relation to Mr. Lynch’s data in further detail in correspondence with the Commission rather than during the search. Mr. Ryan made similar averments in his affidavit sworn on 10th February, 2016.
72. The first letter from Arthur Cox to the Commission was dated 19th May, 2015. It dealt with legally privileged material and it also dealt with: “Data relating to Seamus Lynch”. It was stated that, as noted to the authorised officers during the inspection, Mr. Lynch’s position was “Managing Director Ireland and Spain for CRH Europe”, and, as a result, his functions and activities extended to matters outside of and wholly separate and unrelated to ICL and that documents relating to the functions and activities of Mr. Lynch, which were separate and unrelated to ICL, were outside the scope of the warrant. It was stated that ICL was in the process of reviewing the copy of the seized electronic data for the purpose of identifying the documents relating to the functions and activities of Mr. Lynch which were separate and unrelated to ICL. In the interim, the Commission was requested to undertake not to review any data relating to Mr. Lynch until the position could be confirmed. Further, it was stated that there might be other documents that had been seized that were clearly outside the scope of the search warrant. Once ICL had completed a review of the seized documentation, it might revert in that regard.
73. The reply dated 21st May, 2015 to that letter was from the Commission’s legal adviser. In relation to Mr. Lynch’s data seized, the response was that the Commission case team identified Mr. Lynch as a person of interest given that he was the Managing Director of ICL until very recently and was still a director of ICL. It was stated that the electronic data relating to Mr. Lynch which was seized during the search was seized in accordance with the terms of the search warrant and in exercise of the Commission’s powers under s. 37 of the Act of 2014. It was stated that, apart from documentation over which legal privilege would be successfully claimed, the Commission would review all the material seized at our client’s premises as part of its ongoing investigation.
74. Arthur Cox wrote again to the Commissioner’s legal adviser by letter dated 26th May, 2015. It was reiterated that the data seized relating to Mr. Lynch included documentation in relation to the functions and activities of Mr. Lynch that were separate and unrelated to ICL and that such documentation clearly fell outside the scope of the warrant. It was stated that ICL was in the process of reviewing the copy of the seized electronic data for the purpose of identifying documents relating to functions and activities of Mr. Lynch which were separate and unrelated to ICL and that the rights of CRH to take whatever action might be necessary to protect the confidentiality of its electronic data were reserved. The request not to review any data relating to Mr. Lynch until the position was confirmed was repeated.
75. The response from the legal adviser of the Commission was dated 5th June, 2015. In relation to Mr. Lynch, the response stated that, notwithstanding the points raised in the letter of 26th May, 2015, the Commission maintained its view that the electronic data relating to Mr. Lynch which was seized during the search was seized in accordance with the terms of the search warrant and in exercise of the Commission’s powers under s. 37. Once again it was stated that apart from documentation over which legal privilege was successfully claimed, the Commission would review all material seized at the premises as part of its ongoing investigation.
76. On 10th June, 2015 Arthur Cox wrote again to the Commission’s legal adviser in relation to Mr. Lynch. It was stated that ICL’s position remained as set out in the letters of 19th and 26th May, 2015 and that Arthur Cox would respond in further detail in respect of the matter under separate cover.
77. The next letter was the letter dated 31st August, 2015 from Arthur Cox. That letter focused primarily on Mr. Lynch’s e-mails. It acknowledged that Mr. Lynch’s e- mails contained data which was within the scope of the search warrant, but it also made the case, by reference to Mr. Lynch’s roles as an employee of CRH and ICL, that there was material included which was clearly outside the scope of the search warrant. Having referred to the application of the Convention and the EU Charter to the inspection at the premises of ICL and to certain jurisprudence of the ECtHR, and to the fact that s. 37 of the Act of 2014 must be construed in accordance with the Convention, it was asserted that the Commission, by having unlawfully seized material outside the scope of the search warrant, had infringed the Convention. Further, having referred to Article 7 of the Charter, it was asserted that the taking of documents the property of companies other than ICL was not in accordance with law. Even though Mr. Lynch’s position was addressed in the letter by reference to his business life, as distinct from his private life, nonetheless it is important to emphasise that it was the assertion that there was a breach of Mr. Lynch’s right to privacy under the Convention which grounded the proposal which Arthur Cox went on to set out in the letter for resolving the issue to which it had referred, including identifying the electronic data held by the Commission, which was not within the scope of the search warrant. That proposal was complex.
78. In the light of the suggested similarity between this case and the Janssen case, it is necessary to record the steps, eight in all, which Arthur Cox proposed for the resolution of the issue. They were:
(a) That ICL would undertake a review of Mr. Lynch’s documents from 7th June, 2011, when he had ceased to be in full-time employment of ICL, to identify “non-ICL documents”.
(b) ICL would provide the Commission with a schedule setting out the details of the ICL documents.
(c) Subject to the claims for legal professional privilege and the agreed process in relation to such claims, the Commission could then proceed to review Mr. Lynch’s documents.
(d) Insofar as the Commission could not confirm that a document was a non-ICL document, there was provision for a “cursory look” procedure, to be carried out by the legal adviser or an experienced lawyer.
(e) If a dispute remained the document would be placed in an envelope and sealed in the presence of Mr. O’Brien and/or Mr. Ryan of Arthur Cox.
(f) The relevant documents would then be reviewed by an independent lawyer who would give an opinion as to whether the document was a non-ICL document.
(g) If the parties could still not reach an agreement as to whether a document was a non-ICL document, the document would be referred to the High Court for determination pursuant to an application by ICL/CRH.
(h) The Commission would undertake not to review any of the documents referred to in the schedule pending the resolution of the matter.
The critical point is that the proposal required an undertaking from the Commission not to review any of the documents identified by the Respondents as “Non-ICL” documents pending the resolution of the dispute between the parties, which, in accordance with the process suggested, which used s. 33 as a template, might be by agreement between the parties or, in the absence of agreement on any point, by the opinion of an independent lawyer, or ultimately by a determination of the High Court.
79. The Commission’s legal adviser responded to that letter by a letter dated 10th September, 2015. Following an assertion that the Commission does not accept that the seizure of any data was beyond the scope of the Commission’s powers, which, for the purposes of these proceedings, is no longer the position of the Commission, the essence of the response is encompassed in the following paragraph:
“The [Commission] considers that the electronic data relating to Mr. Lynch which was seized during the search of your client’s premises was seized in accordance with the terms of the search warrant and in the lawful exercise of the [Commission’s] powers under s. 37 . . .. Apart from documentation over which legal privilege is successfully claimed by your client, the [Commission] will review all material seized at your client’s premises as part of its ongoing investigation. The [Commission] does not agree to the proposed process set out on pages 5 and 6 of your letter of 31st August 2015.”
It was also pointed out that the Commission, in the course of any search operation, is subject to the prohibition on unauthorised disclosure of confidential information contained in s. 25 of the Act of 2014.
80. In a further letter dated 25th September, 2015, Arthur Cox reiterated the proposal contained in the letter of 31st August, 2015, which was described, in my view, correctly, as a reasonable and workable procedure for resolution of the issue. It sought specific undertakings in writing. The undertakings were that the Commission would refrain from accessing, reviewing or making any use whatsoever of any of the electronic data relating to Mr. Lynch which was seized pending resolution of the dispute as to whether the data falls outside the search warrant and that the Commission would agree to the dispute resolution procedure set out in the letter of 31st August, 2015. Legal proceedings were threatened if the undertakings sought were not forthcoming from the Commission. It was pointed out that the statement in relation to s. 25 of the Act of 2014 in the letter of 10th September, 2015 did not in any way assuage the Respondents’ well-founded concerns that the Commission proposed to unlawfully review documents which fell outside the scope of the search warrant. The response of the Commission by letter dated 8th October, 2015 from its legal adviser was that it was not agreeable to providing the undertakings requested in the letter of 25th September, 2015. Apart from any documentation over which legal professional privilege was successfully claimed by the Respondents, it was made clear that the Commission intended to review all materials seized at Platin, including Mr. Lynch’s mailbox, as part of its ongoing investigation.
81. Following that letter, the Respondents instituted the plenary proceedings in the High Court on 10th November, 2015. That, in my view, was the only practical and effective course open to the Respondents. It is patently obvious from the interaction which took place between the parties up to that point in time that, even if the Respondents had precisely identified the data in the possession of the Commission which they contended was unrelated to the investigation, such data would not have been protected from unlawful interference by the Commission. Moreover, the reality of the situation is that such protection could not have been assured without the intervention of the High Court.
82. Fundamental to the dispute between the parties from the outset was whether the seizure of all of the material then in its possession by the Commission had been lawful and in accordance with the search warrant, as the Commission contended at the time, or, alternatively, whether some of the material in the possession of the Commission was outside the scope of the search warrant, as the Respondents contended. Further, notwithstanding that, subsequently, for the purposes of these proceedings, it was sensibly acknowledged by the Commission that, as a matter of high probability, some of the e-mails in its possession did not relate to the activity under investigation, which I understand to be an acknowledgement that such material was outside the scope of the search warrant, the Commission was not prepared to agree to a process through which the material which was outside the scope of the search warrant, and, accordingly, should not have been seized, could be identified. Implicit in the Commission’s approach was that it was going to retain all of the material seized, other than legally privileged material, and to access it and deal with it in whatever way it thought fit. There was nothing in the Commission’s approach to suggest that it intended doing anything other than retaining all of the material, not returning any of it to either CRH or Mr. Lynch, as the case may be, or, in the case of digital material, erasing it.
83. As the correspondence between the parties clearly illustrates, what the Respondents were trying to achieve in their proposal was to prevent the Commission accessing, reviewing and using such of the material in its possession as was outside the scope of the search warrant and to prevent a threatened infringement by the Commission of Mr. Lynch’s right to privacy under Article 8. The only obvious route by which that objective could be achieved was the route which the Respondents adopted, namely, issuing plenary proceedings claiming the declaratory and injunctive relief which is being addressed in this judgment. In particular, s. 37 of the Act of 2014 does not address the circumstance in which the Commission seizes material in purported reliance on a search warrant issued pursuant to s. 37(3) but the material or some of the material seized is outside the scope of the search warrant. There is no provision in s. 37 and, indeed, there is no statutory provision in existence which provides for a mechanism by which a person the subject of a search and seizure under s. 37, using the terminology in the Vinci case (at para. 78), can have the lawfulness of the seizure actually and effectively reviewed by a court after it has taken place. In particular, no statutory provision exists which would enable an issue in relation to the seizure of documents that are unrelated to the investigation to be addressed, for example, in the manner in which seizure of privileged legal material is addressed in accordance with s. 33. In short there is no statutory provision to which a person in the position of the Respondents could have resorted.
84. Digressing slightly, in this case, the Respondents were able to resort to judicial remedies available to the High Court in plenary proceedings to redress the alleged breach of Article 8 of the Convention. However, in the proceedings and on the appeal, the Commission has consistently and vigorously opposed the Respondents’ entitlement to the declaratory or injunctive relief sought by them. If the Commission was successful in opposing the granting of such relief, it is difficult to see how it could stand over its assertion that the law does not lack sufficient safeguards to defend the Respondents’ rights under Article 8.
85. Returning to the statutory powers conferred on the Commission, which was established by the Act of 2014, under s. 37, those powers are expressly conferred for “the purpose of obtaining any information which may be required in relation to a matter under investigation under the [Act of 2002]”. Notwithstanding that this appeal is concerned with the application of national law, as explained by Fennelly J. in the passages from his judgment in the Hemat case quoted earlier (at para. 48), the judgments of the CJEU in the Nexans case and in the Deutsche Bahn case are instructive as to the proper application of the law in this case. Moreover, in addressing the Article 8 issue, the observations of the ECtHR in relation to the Prysmian case in the Vinci case are instructive. This case proceeded in the High Court on the basis that, as a result of the search and seizure at the Platin premises, at least some material the property of CRH or Mr. Lynch, which the Commission was not entitled to seize under the search warrant granted under s. 37(3), was removed, albeit with the co-operation of ICL, and retained by the Commission. The appeal in this Court has proceeded in a similar vein. On the basis of that premise, on the authority of the decision of the ECtHR in the Vinci case, CRH or Mr. Lynch or both, must be in a position “to be able to ensure that the lawfulness of the seizures could be actually and effectively reviewed after they took place”, unless they “were able to prevent the seizure of documents that were unrelated to the investigation” (para. 78). What happened in this case is that, although the Respondents did not seek to prevent seizure of the documents in question when it took place, in the plenary proceedings they did seek to prevent, to use the terminology used in the ECN Recommendation, the continued inspection post-seizure, which is unregulated and which they contend would, in relation to the out of scope data, be unlawful and in breach of Article 8.
86. The outcome of the hearing in the High Court was that the intended continued inspection by the Commission of the material which had been seized was prevented by the terms of the injunctive relief granted. One gets an interesting perspective on that outcome if one considers what the position would have been if a permanent injunction in the terms granted by the trial judge had not been granted in the High Court. The Commission would have continued in possession of, and no doubt would have retained, all of the material it had seized, including the material which, admittedly, was unrelated to the investigation. It would be free, without having to refer to its owner, to access, review and use the unrelated material, although it was not being retained lawfully and it was being retained in breach of the owner’s rights under Article 8. Further, the Commission could not be compelled to return the unrelated material to its owner, be it Mr. Lynch or CRH, nor could it be compelled to erase or render invisible the unrelated electronic data in its possession. In short, Mr. Lynch and CRH would have been utterly devoid of any remedy to effectively enforce their rights under Article 8 of the Convention.
87. For that reason, I am satisfied that, in addressing the claim of the Respondents that there had been a breach of Article 8 of the Convention, the trial judge was correct in law in granting the declaratory relief and the permanent injunction in terms which prevents the Commission breaching the right to privacy of Mr. Lynch or CRH, or both, under Article 8 of the Convention through its continued inspection, if not restrained, of all the electronic data seized, having regard to the factual basis that, as a matter of high probability, some of the material seized was outside the scope of the search warrant. On the basis of the jurisprudence of the ECtHR on Article 8 and, in particular, the decision in the Vinci case, the orders made by the trial judge were the appropriate orders to ensure that safeguards are in place which effectively protect the rights of CRH and Mr. Lynch under Article 8. Unfortunately, those reliefs do not provide a resolution to the underlying dispute between the parties, which prompted the view the trial judge expressed (at para. 50) that the outcome does not appear to be “a fully effective remedy”. However, it is the Commission, which is the party at fault, which is at a loss by not being in a position to access, review or use the data within the scope of the search warrant, which the Respondents acknowledge it is entitled to seize.
88. The inclusion of s. 33 of the Act of 2014 to expressly save legally privileged material from inspection highlights the lacuna in the legislation arising from the absence of a mechanism which could be utilised to identify and separate digital material unrelated to the investigation being conducted under the Act of 2002, which may be mixed with digital material which the Commission is entitled to seize under the powers conferred on it by s. 37. It is for the Oireachtas to fill that lacuna. However, there is no reason why, in a particular case, an undertaking or an individual whose digital material has been seized and is to be searched could not reach an agreement with the Commission on an appropriate mechanism to resolve the difficulty, which might include a key word search process and a rendering of out of scope material invisible or, alternatively, which might follow the template contained in s. 33 of the Act of 2014. It is for the Commission, not the Court, to take the steps necessary to resolve its difficulty on the facts of this case.
Proposed order
89. For the foregoing reasons I would affirm those portions of the order of the High Court relating to the Article 8 issue and outlined earlier in para. 16, I would dismiss the appeal insofar as it relates to those parts of the order.
