Revealed: Akzo Nobel threat to global firms
The Akzo Nobel ruling, which controversially stripped in-house counsel of privilege, has again come under fire for having the same impact on non-European private practice lawyers in the EU.
The Akzo Nobel ruling, which controversially stripped in-house counsel of privilege, has again come under fire for having the same impact on non-European private practice lawyers in the EU.
The worrying scenario for global firms has been sparked by a senior silk’s opinion on the matter after concerns were raised by DLA Piper partners about the implications of the 2007 European decisions in AM&S Europe v Commission and Akzo Nobel v Commission.
In the advice, seen by The Lawyer, the senior silk stated: “My clear view is that the written advice from the non-EEA [European Economic Area]-qualified lawyer would not be protected from production [in public proceedings].” The QC goes on to state that having a European lawyer at a meeting or later confirming advice would not qualify that information as privileged.
The ramifications, according to one magic circle partner, could be dramatic, as firms with international competition practices could never integrate fully unless the law is overturned. “A client isn’t going to use, say, a firm’s US lawyer in an EU competition case if they want to stop private issues ending up in the public domain,” the partner told The Lawyer. “It means firms simply can’t have global competition practices in the true sense.”
DLA Piper competition head Mike Pullen confirmed that the firm had sought the opinion on behalf of a client.
“The opinion will be passed on to the [European] Commission as its ramifications add to the debate on Akzo Nobel,” said Pullen.
The news comes as the Law Society seeks leave to intervene before the European Court of Justice in Akzo Nobel.
The representative body is supporting the appeal against the ruling that legal professional privilege does not extend to communications between in-house lawyers and their companies.
Law Society chief executive Des Hudson said in-house lawyers and private practitioners should be afforded the same level of protection.
“It’s in the public interest to ensure that clients can communicate openly and in confidence with their in-house lawyers,” he said.
Readers' comments (5)
Anonymous | 18-Feb-2008 10:53 am
AKZO - Inhouse privilege
Perhaps this point has already been made but is it not the case that preserving normal levels of in-house 'counsel' and client privilege is part of the reason that solicitors (at least) in-house may still use the title 'solicitor' and are issued with full practising certificates (on payment of the appropriate fee). In some European jurisdictions in contrast it was the case that the professional title could not be used in house - for example a German lawyer in house notwithstanding that he/she had been previously a
Rechtsanwalt/Rechtanwaeltin- on going in-house could only use the title Jurist/Juristin signifying (amongst other aspects) the loss of privilege as regards their advice /communication with their client. That has not been the case in the UK with solicitors and therefore this decision at the very least will have an 'uneven effect' as between EU/EEA jurisdictions .
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Jyoti Pakrasi | 18-Feb-2008 3:43 pm
AKZO in house privilege
The previous comment by Anonymous might be slightly misleading re the situation in Germany: A Rechtsanwalt who moves to an in-house position as a lawyer is allowed to continue to use the title of and sign business letters as a 'Rechtsanwalt'.
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Aled Griffiths | 18-Feb-2008 4:31 pm
German in-house lawyers
..following on from Jyoti: the restriction is that they are not able to act in court for their employer. But the conflict between the Akzo judgement and the privilege enjoyed by the in-house Rechtsanwalt is indeed exercising the minds of the bar here.
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Anonymous | 19-Feb-2008 9:20 am
AKZO - In house Privilege
I think that the situation in Germany changed relatively recently to allowing the use of the title Rechtsanwalt/Rechtsanwaeltin in house precisely because of the ambiguity ( amongst other issues ) -- as regards privilege -- caused by the use of Jurist /Juristin.
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Peter Willis, Dundas & Wilson LLP | 19-Feb-2008 11:46 am
Privilege following Akzo Nobel
Akzo Nobel doesn't really change the status of advice given by either in-house lawyers or non-EEA counsel. It has been clear since the AM&S judgment in 1982 that neither will be privileged as against the European Commission. It doesn't matter what professional title an in-house lawyer has (eg. solicitor/legal adviser/Rechtsanwalt/Jurist), or whether his or her advice is privileged for the purposes of national law - it will not be privileged in Commission investigations. Privilege attaches only to advice from external counsel admitted in the EEA. Disappointingly, in the light of the increasing importance and status of the in-house legal function in the 25 years since AM&S, Akzo Nobel failed to overturn this principle. What the judgment did deliver, however, was clarification that internal work done for the purposes of instructing external counsel may be privileged, and that Commission investigators are not allowed to read through advice for which privilege is claimed, in order to decide whether the claim is justified. If a business wants to keep advice away from the Commission, there is, as there has been since 1982, only one option: to obtain it from external counsel admitted in the EEA.
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