UK: The Knotty Issue of Privilege in Competition Law in the EU and UK

Last Updated: 1 March 2005

By Iandra McCallum (London)

Privilege in competition law in and within the EU has always been a complex matter, not least because the issue of defining how wide the scope of privilege is and to which document privilege attaches is in itself complex. In addition, a further layer of complexity is added by the different rules which apply to privilege at an EU level and at a national level for each of the 25 EU member states. How does one, for example, advise a company when it is not only difficult to define which documents privilege will attach to, when at an EU level privilege does not attach to documents prepared by in-house counsel, whereas it does attach to documents prepared by in-house lawyers in some member states, such as the UK? What is more, while in some EU member states there is a clear distinction between litigation and legal advice privilege, others do not draw such distinctions and only rely on litigation privilege. Finally, in some EU member states, such as Germany, legal privilege barely exists.

The issue of privilege is very topical at the moment not only because of recent debate in the EU in relation to whether or not privilege should be extended to in-house counsel, or cases such as Three Rivers1 in the UK or Akzo/Akcros2 in the EU, but also because of the drive on the part of the Commission and National Competition Authorities (NCAs) to route out cartel cases. There has been a marked increase in the amount of dawn raids that the regulatory authorities have visited upon firms. The wider investigatory powers which are now conferred on the Commission through Council Regulation No. 1/2003 even allow seizure of documents on private premises. Equivalent powers are afforded to the Office of Fair Trading in the UK by the Enterprise Act 2002. This therefore makes it all the more critical to determine how privilege should be addressed and which documents are protected by privilege.

At the EU level hopes were raised of extending privilege to in-house counsel by a proposal from the European Parliament to extend privilege to communications between in-house counsel and companies in the new EC merger regulations3 provided that "the legal counsel is properly qualified and subject to adequate rules of professional ethics and discipline which are laid down and enforced in the general interest by the professional association to which the legal counsel belongs."

While this proposal was not adopted, a recent case may yet extend some privilege to inhouse lawyers’ communications. On 30 October 2003, the President of the Court of First Instance ("CFI") granted an interim measure for relief in the case between Akzo Noble Chemicals Limited and Akcros Chemicals Limited (the applicants) against the European Commission on communications by in-house lawyers.4 Part of this case centred around legal privilege of documents which were copied by the Commission in a dawn raid in February 2003.

The dispute over privilege centred on five documents which were kept in separate files by the applicants and to which the applicants claimed privilege attached. The five documents were ultimately treated in two different ways. Two of the five documents (Set A), which the applicants claimed were drafted in preparation for the purpose of obtaining external legal advice in connection with competition law compliance, were examined by the Commission and put in separate sealed envelopes as the Commission was not in a position to reach a definitive on the spot conclusion on whether or not privilege attached to those documents. The other three documents (Set B) consisted of hand written notes and of emails between employees of the applicants related to Set A. Set B was copied by the Commission and put on its files but not enclosed in a separate sealed envelope.

Pending the final resolution of the case the President of the CFI ordered that the Commission keeps both Set A and Set B documents in sealed envelopes, that all additional copies of Set B documents are destroyed and the Commission takes no further steps to review or use the documents of either Set A or Set B.

On 27 September 2004 the European Court of Justice ("ECJ") annulled the CFI interim relief order in this case. Rather disappointingly, the EJC did not look specifically at what documents legal privilege attaches to, but rather at the circumstances in which interim measures can be granted and whether the conditions of urgency is satisfied for an application for interim measures. On that basis, the practical application should be to continue applying the findings of the CFI in relation to privilege. If there is any doubt or question raised about privilege of dawn raided documents, in-house counsel should argue to try and get such documents kept separately in a sealed envelope.

Given that the ECJ did not rule on the issue of privilege in general, but rather on the application of interim measures including their application to disputes over privilege and that the ECJ, interestingly, did not address the issue of privilege in relation to the Set B documents, privilege at the EU level is still shrouded in some uncertainty. In the UK however, while the Courts of Appeal decision "Three Rivers" did create some uncertainty with regards to the application of legal advice privilege, this now appears to have been settled by the House of Lords decision in the same case.

The general principle of legal advice privilege in the UK is that there is understood to be broad protection for communications between a solicitor and his client in the course of the solicitor/client relationship where the solicitor gives legal advice on a client’s legal rights and liabilities, so that even where a particular piece of advice is not advice about rights and obligations, it would still be covered by the inherent "continuum of communication" 5 in the solicitor/client relationship.

This was challenged in the Court of Appeal in the Three Rivers case, though the principle was finally upheld in the House of Lords decision. The documents in question in Three Rivers6 were communications between the employees or ex-employees of the Bank of England (Bank) and its solicitors which were prepared by the Bank for its submission to the Bingham Inquiry on the collapse of the Bank of Commerce and Credit International S.A. (BCCI). It was agreed by all parties that no litigation privilege attached to such documents and therefore the question was whether legal advice privilege would attach. The Court of Appeal therefore looked at (i) whether the documents for which privilege was claimed were documents of a class comprised within the doctrine of legal advice privilege and (ii) whether, in any event, they had been prepared for the dominant purpose of obtaining legal advice or rather for the purpose of placing the facts before Lord Justice Bingham.

Much of the decision centred around the type of inquiry the Bingham Inquiry was and whether privilege should attach to preparation of documents for such a private, non-statutory inquiry. Having determined that this was not the type of inquiry to which litigation privilege of documents would normally attach, the Court looked more specifically at what it deemed to be a "difficult [and] unsatisfactory"7 area of legal advice privilege. In this area, the Court queried the justification for attaching privilege to documents where the lack of such privilege would not inhibit communications between solicitor and client.

The Court of Appeal decision in Three Rivers narrowed the scope of legal advice privilege in that the Court suggested that legal advice privilege should only attach to advice and documents whose dominant purpose is the seeking or obtaining of legal advice concerning rights and/or obligations.

This Court of Appeal decision was overturned by the House of Lords and the position with regard to legal advice privilege in the UK is therefore the same as it was prior to the Three Rivers decision, that is, that there is broad protection for communications between a solicitor and his client in the course of the solicitor/client relationship where the solicitor gives legal advice on a client’s legal rights and liabilities, even where a particular piece of advice is not about rights and obligations. While there is wide relief in the UK about the House of Lords overturning the Court of Appeals decision, many regret the decision did not clarify whether or not communications between an employee and his employer’s lawyer should be treated as communications between client and lawyer for the purposes of legal advice privilege.

On a practical level, what steps should be taken to ensure the existence of the greatest possible protection of documents through privilege? The key guidelines for clients are:

  • Legal advice from internal and from external lawyers is kept on a separate file.
  • That separate file is clearly marked "Legally Privileged Documents."
  • All legal advice to which privilege attaches is clearly marked "privileged and confidential."
  • All correspondence between a firm and its external counsel is clearly marked: "Legally Privileged. Prepared for the purpose of seeking legal advice."
  • To the extent possible, internal sensitive issues should be addressed either verbally or through external lawyers.
  • Written advice on sensitive matters should only be produced by external counsel. This advice should not in any way be amended, added to or quoted from, as this would remove privilege. As soon as possible following receipt, the correspondence should be placed on the file referred to above.
  • During a dawn raid the access to any privileged documents is carefully supervised, and, in case the Commission or NCA wants copies of the privileged documents, these should be kept in a sealed envelope until the issue of privilege is resolved.


1 Opinions of the Lords of Appeal for Judgement in the Court Three Rivers District Council and Others (Respondents) v. Governor and Company of the Bank of England (Appellants) [2004] on Thursday 11 November 2004, following decision of 29 July 2004.

2 Case C-7/04 P(R) Commission v Akzo Nobel Chemicals Ltd and Akcros Chemicals Ltd, Order of the President of the ECJ, 27 September 2004

3 Council Regulation (EC) No 139/2004 of 20 January 2004; OJ L 24/1 of 29.1.2004.

4 Joined cases T-125/03R and T/253/03R

5 Balabel v Air India [1988] CH 317

6 Three Rivers District Council and Others v The Governor and Company of the Bank of England [2004] EWCA Cir 218

7 Three Rivers, at paragraph 39

Copyright © 2007, Mayer, Brown, Rowe & Maw LLP. and/or Mayer Brown International LLP. This Mayer Brown article provides information and comments on legal issues and developments of interest. The foregoing is not a comprehensive treatment of the subject matter covered and is not intended to provide legal advice. Readers should seek specific legal advice before taking any action with respect to the matters discussed herein.

Mayer Brown is a combination of two limited liability partnerships: one named Mayer Brown LLP, established in Illinois, USA; and one named Mayer Brown International LLP, incorporated in England.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.