Does the fundamental right to protection of communications between lawyers and their clients extend to in-house counsel? Not under EU law, says Advocate General Kokott in the case of Akzo Nobel Chemicals Ltd and Akcros Chemical Ltd v European Commission (Case C-550/07 P, delivered on 29 April 2010).
This question about the scope of legal professional privilege in competition investigations by the European Commission arose in an investigation into a cartel and a related raid at the UK offices of Akcros and its subsidiary Akzo. The Commission seized several documents, including emails exchanged between Akzo’s manager and an in-house lawyer, who was based in the Netherlands and admitted to the bar there. Akzo and Akcros (“the companies”) brought proceedings before the EU Court of First Instance (now the General Court) challenging the Commission’s right to seize those documents, claiming that they were protected by legal professional privilege. The court dismissed the action and the companies appealed to the Court of Justice. In this opinion, the Advocate General proposes that the Court should dismiss the appeal.
The Advocate General reasons that attorney-client privilege is intended not merely to safeguard the client’s right to defence, but that it is grounded on the lawyer’s role as an ‘organ of the administration of justice’, that is, to provide legal representation in full independence. An in-house lawyer, who is employed by and receives a salary from the company/client does not have the same degree of independence from the client as an outside counsel who works in an external law firm. This is true even if the in-house lawyer is a member of a Bar or Law Society. There is simply a greater risk that the in-house lawyer will be faced with a conflict of interests because he or she is economically dependent on the company. Consequently, there is no requirement that these two groups of lawyer receive equal treatment regarding the legal professional privilege.
The opinion also mentions the fact that the member states have individual privilege regimes; only a few — the UK, Ireland and the Netherlands — apply the privilege to in-house lawyers. This is similar to the situation in the US where in-house counsel are treated like any independent attorney regarding attorney-client privilege. The controlling question is whether the communications with counsel were confidential and made for the purpose of receiving legal advice.
What conclusions can we draw at this point? Only that lawyers and clients should be aware that different rules may apply in different jurisdictions. Communications that may be privileged in the US or the UK may not be protected under EU rules. So, apply common sense and think before you open your mouth or press the “send” button.
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