Case number: 99373

Request for records relating to an investigation carried out by the Revenue Commissioners at the request of the US Customs - whether information received under a specific international agreement is confidential - section 26(1)(a) - whether disclosure of the information concerned would constitute a breach of a duty of confidence - section 26(1)(b) - public interest

Case Summary

Facts

Following a request from the US Customs authorities under the Mutual Assistance Agreement, the Revenue carried out an investigation at the offices of Company Y Ltd in Dublin. Company Y Ltd then sought access to all records relating to the request of the US Customs. The Revenue refused access under section 26(1)(a) and 26(1)(b) of the FOI Act.

Decision

The Commissioner accepted that the letter from the US Customs to Revenue requesting assistance under the Mutual Assistance Agreement met the provisions of both the section 26(1)(a) and 26(1)(b). The Commissioner commented that not all communications exchanged under the Agreement would be confidential adding that information given in confidence is concerned with private or secret matters

The letter included a list of questions that the US authorities requested the Revenue to put to Company Y Ltd. In the circumstances the questions listed were never put to the company. The Commissioner still found that the list of questions met the provisions of section 26(1)(a) and 26(1)(b). In addressing the public interest arguments in favour of release the Commissioner commented that there was no public interest in the right of Company Y Ltd to defend itself as no detriment had been suffered by Company Y Ltd.

Date of Decision: 11.03.2002

Our Reference: 99373

11.03.2002

Mr X

Dear Mr X

I refer to the application you made on behalf of Company Y Ltd for a review of the decision of the Revenue Commissioners ("the Revenue") to refuse access to certain records relating to Company Y Ltd under the Freedom of Information Act ("the Act"). I wish to apologise for the delay in dealing with your application which is due to the large number of applications currently with my Office.

Background

I have now completed my review of the Revenue's decision. In carrying out that review, I have had regard to :

  • your submission and original application of 22 October 1999,
  • submissions from the Revenue dated 14 October 1999, 20 October 1999, 12 November 2001 and 19 December 2001 and,
  • a submission from the US Customs Service dated 17 January 2002.

I have also had regard to the Revenue's decision on your original request under the Act and I have examined the records to which access has been refused. I note that you were given an opportunity to make a further submission on 18 December 2001 but declined that opportunity.

I also note that the Revenue did not supply you with a description or schedule of records which it considered related to the request. Accordingly, I will give a brief description of the four records involved:

Record 1 : Letter dated 6 August 1998 from the US authorities to the Revenue requesting assistance pursuant to the Mutual Assistance Agreement between the US and Irish customs authorities. Record 2 : Appendix to record 1, consisting of four pages of questions and instructions provided to the Revenue in relation to its visit to the offices of Company Y Ltd . Record 3 : Internal memo dated 19 August 1998. Record 4 : One page reply from the Revenue to the US customs outlining the results of its investigation into Company Y Ltd . Eleven pages of computer print-outs are attached to the reply.

Scope of Review

I note from your submission that you are not seeking access to the results of the investigation carried out by the Revenue. As record 4 details these results, my review is concerned only with whether the decision of the Revenue to refuse access to records 1 to 3, described above, is correct.

Findings

The Revenue refused access to records 1 to 3 under sections 23(1)(a)(i), 24(1)(c), 26(1)(a) and 26(1)(b) of the FOI Act.

Records 1 and 2

Section 26(1)(a)

Section 26(1)(a) of the Act provides that a public body must refuse a request if -

  • the record contains information given to it in confidence and on the understanding that it would be treated by it as confidential, and
  • in the opinion of the public body, disclosure of the information would be likely to prejudice the giving to the body of further similar information from the same person or other persons, and
  • it is of importance to the public body that such further similar information should continue to be given to the public body.

The information in records 1 and 2, i.e. information contained in the request for assistance and the appendix, was given to the Revenue by the US authorities under the Mutual Assistance Agreement ("the Agreement"). Article 4.1 of the Agreement states that:

"Information, documents and other communications received in the course of mutual assistance may be used only for the purposes specified in this Agreement, including use in judicial or administrative proceedings..."

The main purpose of the Agreement is to provide administrative assistance to prevent and investigate offences within the competence of the respective customs administrations.

Article 4.4. of the Agreement provides that "requests, information, reports of experts and other communications provided...pursuant to this Agreement shall be accorded the same protection, including confidentiality, by that Customs Administration as is afforded to documents and information of like nature under its national law". ....

It is clear that the US authorities provided the information pursuant to the Agreement and for a specific purpose, i.e. to request that the Revenue visit the office and make inquiries of Company Y Ltd. I accept that the information was supplied by the US authorities in confidence and, given the provisions of the Agreement, that there was a mutual understanding that the information would be treated by the Revenue as confidential.

I should make it clear that I do not accept that all communications exchanged under the Agreement would be confidential. Information given in confidence is concerned with private or secret matters rather than information which is trite or which is already in the public domain. In other words, it is necessary to establish that the information has the necessary quality of confidence. The records in this case outline the areas that the US customs wished the Revenue to analyse, as well as details of suspected fraud by a company other than Company Y Ltd . As such, it reveals some of the methods used by the US authorities to identify possible unlawful practices. The records also contain a list of questions that the US authorities requested the Revenue to put to Company Y Ltd . In the circumstances, the questions listed were never asked of Company Y Ltd . I have considered whether the fact that the US authorities were prepared to reveal these questions to Company Y Ltd , albeit verbally and not in writing, would remove the quality of confidence from them. I have concluded that, as the questions were never put to Company Y Ltd and that as they consist of inquiries relating to an investigation which is still ongoing, that they have not lost their quality of confidence. Therefore, I am satisfied that records 1 and 2 meet the first requirement of section 26(1)(a).

Both the Revenue and US customs have expressed serious concerns over the possible release of the records sought. In particular the US customs has expressed concern over the possible impact release of the material may have on an ongoing investigation. The Revenue has stated that if the situation was reversed and material it supplied to another customs authority under a mutual customs agreement was released without its consent, then it would immediately cease the provision of such information. For a record to meet the second part of section 26(1)(a) it is not necessary that disclosure would definitely prejudice the supply of information. Rather what is required is that disclosure would be likely to prejudice the supply of similar information. While I make no comment on the Revenue's specific claim, it is clear to me that the US customs has a reasonable expectation that sensitive material such as this would remain confidential. I accept that where confidential material, supplied under the Agreement and relating to an ongoing investigation is disclosed, that this would be likely to prejudice the giving of further similar information to the Revenue.

In its submissions to me the Revenue has outlined the importance of the Agreement to the customs administrations of both countries. It has explained the benefits of the Agreement as a tool for detecting and combating offences against customs laws. The Agreement is based on the exchange of information and assistance and the Revenue has indicated that it relies on information received under the Agreement in countering customs-related offences in Ireland. I accept that there are significant benefits to the Revenue in obtaining information under the Agreement and that it is important to Revenue that this type of information continue to be exchanged.

In your submission you have drawn my attention to the specific reference in Article 4.4 of the Agreement which provides that requests, information, etc. exchanged under the Agreement "shall be accorded the same protection, including confidentiality, by that Customs Administration as is afforded to documents and information of like nature under its national law". You have argued that the records in question are not rendered wholly confidential by virtue of the Agreement but that the level of confidentiality attaching to the documents falls to be determined by the relevant provisions of national law. I agree that the records exchanged under the agreement are subject to the provisions of the FOI Act. However the Act provides for a right of access to records subject to the exemptions in the Act. In this case the Revenue has claimed that section 26(1)(a) applies to records 1 and 2, and in this particular case I find that the Revenue is correct.

Public Interest I have found that records 1 and 2 are exempt under section 26(1)(a). However, section 26(1)(a) shall not apply to a record if the public interest would, on balance, be better served by granting than by refusing to grant access to the record.

In your submission you present a number of arguments related to the rules of natural justice. Natural justice in this instance would mainly be concerned with the right to defend one's good name against charges or public accusations. However in this case Company Y Ltd has not been charged with any offence and has not suffered any detriment, although it may have suffered some inconvenience as a result of the visit by the Revenue. No public accusations have been made against Company Y Ltd . The visit by the Revenue to Company Y Ltd 's office arose as a result of a request for assistance from the US authorities who were, and still are, investigating a separate company. I am not aware of any action that has been taken against Company Y Ltd since the visit. Therefore, the public interest in access to the records in order that Company Y Ltd can defend itself does not arise.

I must also consider the public interest in maintaining the confidence in the Mutual Assistance Agreement and the benefits that are derived from it by the customs authorities of both the US and Ireland. In the circumstances I find that the public interest would not be better served by granting access to records 1 and 2. As I have found that section 26(1)(a) applies to records 1 and 2 it is not necessary for me to decide whether any of the other exemptions claimed by the Revenue apply.

Section 26(1)(b)

However, I have considered whether section 26(1)(b) applies to records 1 and 2. In other words, whether disclosure of the information concerned would constitute a breach a duty of confidence owed by the Revenue to the US customs by virtue of an agreement, an enactment or otherwise by law. The Agreement between the two Governments seems to me to impose a general duty of confidence on both administrations in relation to information and documents exchanged under the Agreement. I find, therefore, that section 26(1)(b) also applies to records 1 and 2. Record 3 Record 3 is a routine internal memo created by the Revenue. As a record created by officials in Revenue, section 26(1)(a) cannot apply unless disclosure of the information would constitute a breach of a duty of confidence that is provided for by an agreement or statute or otherwise by law. Having examined the contents of the memo I find that, with one exception described below, its disclosure would not constitute a breach of a duty of confidence and that neither 26(1)(a) nor 26(1)(b) apply.

I note that the Revenue has also claimed that the record is exempt by virtue of sections 23(1)(a)(i) and 24(1)(c) of the Act. However I fail to see how any of the harms envisaged in either section could occur if access to this memo was granted.

The memo does mention the company which is the subject of the investigation by the US customs. I have already found that the information received by the Revenue under the Agreement is exempt under section 26(1)(b). The question which I have to address is whether this duty of confidence also extends to the name of the company. As the name of the company originated from the US customs and came into the Revenue's possession as part of the information provided under the Agreement I find that the name of the company is exempt under section 26(1)(b) on the grounds that a duty of confidence exists.

Decision

Having carried out a review under section 34(2) of the Freedom of Information Act, 1997, I have decided to vary the decision of the Revenue and direct that access be granted to record 3 with the deletion of the name of a company as described above.

A party to a review, or any other person affected by a decision of the Information Commissioner following a review, may appeal to the High Court on a point of law arising from the decision. Such an appeal must be initiated not later than four weeks from the date of this letter.

Yours sincerely





Information Commissioner