What Risks Does Freedom Of Information Pose For The Private Sector?

After much eager anticipation the Freedom of Information Act 2000 (the "Act") came fully into force on 1 January 2005 permitting anyone to make a request to a public authority seeking ad hoc disclosure of information. The Act was greeted with a flurry of activity, reported gleefully by the media, but has perhaps not had the impact some might have anticipated.

As expected, many public authorities were inundated with requests, but on the periphery of central government, fewer requests than expected have been received. Indeed, many local authorities have reported "business as usual" in the number of requests for information that they have received. However, if the experience of other jurisdictions is replicated here, it may take some time before those in the private sector appreciate just how much of their own information might be in the hands of a public authority (and potentially accessible) and how much of an opportunity this legislation provides to gain information on prospective and existing public projects, and on the activities of competitors.

The purpose of the Act is to facilitate open government. Any person making a request for information of a public authority is entitled:

(i) to be informed in writing by the public authority whether it holds the described information and, if so,

(ii) to have the relevant information communicated to it.

The only real constraint is that specific exemptions prescribed in the Act may permit a public authority to refuse disclosure.

The risk for suppliers to the public sector derives from the fact that over many years they will have provided a variety of information to public bodies, sometimes in a procurement context, but also more generally in conducting their business. This information is at risk of disclosure in response to a request under the Act. Much of it is likely to be confidential or commercially sensitive information and a supplier may not wish its other customers or its competitors to gain access to it. However, the decision to release or withhold the information is a decision for the public authority to take, not the third party whose information may be the subject of the request. How can a supplier ensure it knows in advance that its information may be released? What can a supplier do to ensure that the possibility of an exemption applying is appropriately considered before its information is released?

The Act requires the public authority to make decisions as to whether information should be disclosed or withheld. A third party has no power of veto over that decision. However, there are some practical steps which suppliers may consider undertaking in order to best preserve their information.

• Take stock of the information likely to be in the hands of a public authority already.
• Review existing procurement processes to ensure that only information which needs to be disclosed is disclosed and that information is not passed to a public authority as a matter of course.
• Ensure the public authority knows what information the supplier considers to be confidential. For new projects, confidentiality clauses may assist, but guidance issued under the Act warns suppliers not to expect wide-ranging confidentiality obligations to be agreed. The recommended approach is to prepare a schedule of confidential information. For existing projects, a schedule may assist in setting expectations, but authorities have expressed irritation when suppliers have sought retrospectively to impose confidentiality obligations in order to protect their information from disclosure.
• Foster the sort of relationship with public authorities which will make it easy for them to notify you if a request is made for your information.

Finally, suppliers should think strategically about how to exploit the opportunities offered by the Act. American experience suggests that approximately 50% of all requests under similar legislation are made by businesses seeking information about their competitors.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.