Authorized privilege is a recurring subject for UK attorneys representing purchasers in litigation, investigations, and reverse regulatory our bodies. Now, courtesy of Brexit, there’s a new subject to handle: since 1 January, attorneys working in each the UK and EU member states want to contemplate, extra rigorously than ever, the completely different guidelines of privilege when structuring investigations and advising on potential competitors regulation points that would consequence within the involvement of the European Fee (EC).


Authorized privilege in England and Wales

The applying of English regulation to authorized privilege is a crucial subject that’s often debated in court docket. Rightly so: it’s a basic human proper, central to the administration of justice; it’s within the public curiosity that people and corporations needs to be permitted to hunt and obtain authorized recommendation, and examine and collect proof, with out shedding the good thing about privilege.

Authorized privilege applies, beneath English regulation, to each attorneys employed in personal observe and attorneys employed by corporations and corporations. As affirmed in September 2020 in PJSC Tatneft v Bogolyubov and others [2020] EWHC 2437 (Comm), privilege extends to communications with in-house and personal observe overseas attorneys with out regard to their specific nationwide requirements, regulation or guidelines on authorized privilege. The truth that in-house attorneys usually are not impartial however paid staff of the recipient of their authorized recommendation is irrelevant beneath English regulation.

Final 12 months, there have been a number of hotly contested privilege disputes decided by the English courts, together with the next instances addressing the problems of scope of authorized recommendation privilege and waiver of privilege.

In Civil Aviation Authority v R (ex p Ltd) [2020] EWCA Civ 35 the Courtroom of Enchantment reaffirmed the scope of authorized recommendation privilege: solely communications created for the dominant goal of acquiring or giving authorized recommendation will probably be protected against disclosure on the grounds of privilege.

For instance, if the dominant goal of an e-mail is to acquire the business views of a non-lawyer then it is not going to be privileged, even when a subsidiary goal is concurrently to acquire authorized recommendation from a lawyer who additionally receives the e-mail. Jet2 additionally bolstered the place that an attachment to a privileged e-mail is not going to robotically be protected by privilege as nicely.

Later within the 12 months, in PCP Capital Companions LLP and one other v Barclays Financial institution Plc [2020] EWHC 1393 (Comm), the Industrial Courtroom clarified what constitutes a waiver of privilege. In that case, the choose held that privilege had been waived despite the fact that witnesses had solely referred to the impact (moderately than the content material) of authorized recommendation.

This can be a reminder that making any reference to authorized recommendation in any communications with third events needs to be approached with warning.

EU authorized privilege

The place is completely different in respect of competitors law-related administrative or enforcement procedures performed by the EC. In these circumstances, EU regulation dictates that authorized privilege will solely apply to paperwork (that means that these paperwork don’t should be disclosed to the EC) if each of the next situations are met:

  • The communications had been made for the needs and within the pursuits of the agency’s proper to defend itself in precise or potential EU and EEA competitors proceedings;
  • The communications emanate from impartial (ie not in-house) attorneys entitled to practise within the EEA.

Case 155/79 AM & S v Fee [1982] ECR 1575 and C-550/07 P – Akzo Nobel Chemical substances and Akcros Chemical substances v Fee [2010] 2 A.C. 338.

The affect of Brexit

These EU authorized privilege guidelines have created a difficulty for in-house attorneys for a while, however Brexit broadens it. Within the context of precise or potential EU and EEA competitors proceedings, UK attorneys at the moment are third-country attorneys. Which means there’s a actual threat that the EC is not going to recognise as privileged any communications that search or give authorized recommendation from attorneys certified within the UK.

This provides rise to a number of potential eventualities the place corporations that proceed to have gross sales or a presence within the EU and/or EEA post-Brexit could also be required to reveal authorized recommendation from UK-qualified attorneys to the EC within the context of a EC investigation or process. For instance, the place:

  • authorized recommendation has been given to corporations primarily based in EU or EEA member states,
  • a number of of the recipients of authorized recommendation is bodily primarily based within the EU or EEA (eg basic counsel or director is predicated in Germany), and
  • authorized recommendation has been given to a UK subsidiary of an EU dad or mum firm which could possibly be deemed to have entry to its UK subsidiary’s paperwork.

To keep away from this threat of disclosure, attorneys (each in-house and personal observe) and their purchasers should rigorously contemplate how authorized recommendation is procured, given and shared after they face points that may contact on competitors regulation necessities and, finally, could contain the EC.

Sensible steps

Together with the numerous adjustments and challenges offered by Brexit, UK attorneys should be alive to the modified standing of authorized recommendation within the context of EC proceedings.

Each in-house and personal observe attorneys ought to guarantee a plan is carried out to handle the brand new threat that authorized recommendation given by attorneys certified within the UK could change into disclosable to the EC, the place earlier than Brexit, it will have been privileged.

In doing so, it will be prudent to overview all energetic or potential instances and investigations with a cross-border component to evaluate the related threat of this alteration. Now is an efficient time to refresh coaching periods on privilege, and reinforce good practices that improve the probability that communications are protected by privilege, together with guaranteeing purchasers interact with the authorized staff early when doable disputes are on the horizon or different dangers come up.


Clare Reeve Curatola is senior affiliate at worldwide regulation agency Bryan Cave Leighton Paisner