Ó Oifig an Choimisinéara Faisnéise
Cásuimhir: OIC-53377-L3M2J2
Foilsithe
Teanga: Níl leagan Gaeilge den mhír seo ar fáil.
Whether the Regulator was justified in its decision under sections 35 or 36 of the FOI Act to release parts of records on a request to which section 38 of the FOI Act applies for correspondence with PLI regarding any breaches of PLI’s licence relating to marketing communications during 2017 and 2018
27 September 2019
This review arises from a decision made by the Regulator to grant partial access to records on foot of a request to which section 38 of the FOI Act applies. Section 38 applies to cases where the FOI body has formed a view that the record(s) in question are exempt under section 35 (confidential information) and/or section 36 (commercially sensitive information) and/or section 37 (personal information) but that the record(s) should be released in the public interest.
Where section 38 applies, the FOI body is required to notify an affected third party before making a final decision on whether or not the exemption(s), otherwise found to apply, should be overridden in the public interest. The requester, or an affected third party, on receiving notice of the final decision of the FOI body, may apply directly for a review of that decision to this Office.
The National Lottery Licence (the Licence) is a State Asset that was sold to PLI in 2014. The other parties to the Licence are the Regulator and the Minister for Public Expenditure and Reform. The Licence and the National Lottery Act 2013 (the 2013 Act) imposes various obligations on the parties.
In an FOI request to the Regulator dated 29 December 2018, as narrowed on 8 January 2019, the requester sought access to correspondence with PLI regarding any breaches of the Licence relating to marketing communications during 2017 and 2018.
On 21 January 2019, the Regulator provided PLI with copies of the 37 records it had identified as within the scope of the request. It said that, having considered sections 35 to 37 of the FOI Act, its view was that the public interest would, on balance, be better served by granting access to the records except for any personal information in them. PLI responded to the Regulator on 8 February 2019, arguing that the request should be refused in full. The Regulator also consulted with three other third parties, all of whom consented to the disclosure of the records.
On 21 February 2019, the Regulator decided that parts of the records were exempt under sections 35(1)(b) (duty of confidence), 36(1)(a) (trade secrets), 36(1)(b) (commercially sensitive information) and 37(1) (personal information) of the FOI Act and that the public interest weighed in favour of refusing access to the details concerned. It decided that the rest of the information fell to be released.
On 7 March 2019, PLI made an application to this Office for a review of the Regulator's decision to grant the request in part. It said that the records should be withheld in full. It also identified particular information that it said should be redacted “at a minimum” as well as some inconsistencies in the Regulator’s proposed redactions.
I have now decided to conclude my review by way of a formal, binding decision. In carrying out my review, I have had regard to the above exchanges and to correspondence between this Office, the Regulator, PLI and the original requester. I should say that the arguments made by the Regulator and PLI are lengthy and detailed and while I do not intend to repeat them in full in this decision, I have given them careful consideration. I have also had regard to relevant Clauses of the Licence, which the Regulator has published in part further to this Office's decision in Case No 150082. I have had regard also to the records considered by the Regulator and to the provisions of the FOI Act.
This review is confined to whether the Regulator’s decision to grant partial access to the records covered by the request is justified under the FOI Act.
The Regulator has categorised the 37 records as relevant to four investigations/reviews it carried out i.e. the Part A records (records 1-14), the Part B records (records 15-23), the Part C records (records 24- 29) and the Part D records (records 30-37). Generally speaking, the records are correspondence between the Regulator and PLI containing their views and positions about the particular matters under consideration by the Regulator.
At the outset, it is relevant to note a number of preliminary matters.
No party to a review has a veto over release of records.
Any review conducted under section 22 of the FOI Act is de novo, which means that it is based on the circumstances and the law as they pertain at the time of this decision.
While the FOI Act requires the Commissioner to provide reasons for decisions, section 25(3) of the FOI Act also requires all reasonable precautions to be taken in the course of a review to prevent disclosure of information contained in an exempt record. This means that the extent to which I can describe the records and discuss some of the arguments in my analysis is limited.
Section 18(1) provides, that "if it is practicable to do so", access to an otherwise exempt record shall be granted by preparing a copy, in such form as the head of the public body concerned considers appropriate, of the record with the exempt information removed. Section 18(1) does not apply, however, if the copy provided for thereby would be misleading (section 18(2) refers). While the Regulator intends to grant partial access to the records, it should be noted that this Office takes the view that, generally, neither the definition of a record nor the provisions of section 18 envisage or require the extracting of particular sentences or occasional paragraphs from such details for the purpose of granting access to those particular sentences or paragraphs.
Finally, the release of a record under the FOI Act is understood, effectively, to be equivalent to its release to the world at large.
Further to its consultation with the applicant under section 38 of the FOI Act, the Regulator does not consider that the records it decided to release should be withheld under sections 35 to 37 of the FOI Act given the public interest in their release. PLI argues that sections 35(1)(a) (confidential information), 35(1)(b) and 36(1)(b) apply to the records in their entirety and that the public interest does not weigh in favour of granting access to them.
As already noted, this is a case to which section 38 applies. I have considered the fact that an FOI request only falls within the ambit of section 38 if it is one "to which section 35(3) or 36(3) applies or to which section 37(5) applies and which, apart from this section, would fall to be granted" [emphasis added]. In other words, exemptions which are not subject to those subsections are generally not relevant in section 38 cases. Section 35(3) applies the public interest balancing test to section 35(1)(a) and not to section 35(1)(b).
In previous decisions, e.g. Case 98049 (Henry Ford & Sons Ltd, Nissan Ireland and Motor Distributors Ltd and the Office of Public Works (1999), available at www.oic.ie), this Office has acknowledged the overlap between the confidentiality requirements of the then equivalent of sections 35(1)(a) and (b). I am satisfied that in the circumstances, I should consider both of these provisions.
I have no basis on which to consider the application of provisions of the FOI Act outside of sections 35, 36 or 37. For instance, PLI says that disclosure of the records will impact on its relatively open relationship with the Regulator. Generally speaking, such an argument may be relevant to the discretionary section 30 of the FOI Act (functions and negotiations of an FOI body). However, the Regulator does not consider the records to be exempt under this or other provisions of the FOI Act
PLI gives an example of where it considers the Regulator to have been inconsistent in its redactions of certain material in the records. It also says that it is entitled to understand the basis on which the Regulator has made each redaction to the records. It says that only then can it identify inconsistencies in the Regulator’s approach and reasoning and articulate its case as to why the remaining information should not be disclosed.
While the Regulator may not have been entirely consistent in its treatment of the redactions in the various records, I do not consider it appropriate to direct that certain details be withheld purely on the basis that they are the same as or similar to information that the Regulator decided to redact from other records. I have not considered such redacted information or drawn any conclusion on whether or not it has been appropriately withheld. This review is concerned only with those parts of the records that the Regulator decided to release.
While the FOI Act requires decision makers to give reasons for their decisions, I do not believe that it requires those decisions to be as detailed as the applicant requires. The Regulator has provided the applicant with copies of the records under review and details of the excerpts it ultimately decided to withhold. It seems to me that the applicant is in a position to identify any specific details that it considers to be particularly sensitive and to explain why they should be found to be exempt under sections 35, 36 or 37 of the FOI Act.
Section 35(2) dis-applies section 35(1) in certain circumstances. It provides that subsection (1) shall not apply to a record which is prepared by a head or any other person (being a director or staff member of an FOI body or a service provider) in the course of the performance of his or her functions "unless disclosure of the information concerned would constitute a breach of a duty of confidence that is provided for by an agreement or statute or otherwise by law and is owed to a person other than an FOI body or head or a director, or member of staff of an FOI body or of such a service provider."
I accept that PLI is not a service provider within the meaning of the FOI Act. Accordingly, it is possible for section 35(1) to apply to the records.
Section 35(1)(a) must be applied to a record containing information that was:
Section 35(1)(b) must be applied to a record where granting it would constitute a breach of a duty of confidence provided for by an enactment other than by certain provisions of particular enactments specified by the Act, an agreement or otherwise by law (i.e. an equitable duty of confidence).
Section 36(1)(b) must be applied to certain types of information whose disclosure could reasonably be expected to result in material financial loss or gain to the person to whom the information relates, or could prejudice the competitive position of the person in the conduct of his or her profession or business or otherwise in his or her occupation. The essence of the test in section 36(1)(b) is not the nature of the information but the nature of the harm which might be occasioned by its release.
The harm test in the first part of section 36(1)(b) is that disclosure "could reasonably be expected to result in material loss or gain". This Office takes the view that the test to be applied is not concerned with the question of probabilities or possibilities but with whether the decision maker's expectation is reasonable.
The harm test in the second part of section 36(1)(b) is that disclosure of the information "could prejudice the competitive position" of the person in the conduct of their business or profession. The standard of proof to be met here is considerably lower than the "could reasonably be expected" test in the first part of this exemption. However, this Office takes the view that, in invoking "prejudice", the damage which could occur must be specified with a reasonable degree of clarity.
In the High Court case of Westwood Club v The Information Commissioner [2014] IEHC 375 Cross J. held that it is not sufficient for a party relying on section 36(1)(b) to merely restate the provisions of the section, list the documents and say that they are commercially sensitive. A party opposing release should explain why disclosure of the particular records could prejudice their financial position. Furthermore, a general prediction without any supporting evidence is not sufficient to satisfy the requirement that access to the record could reasonably be expected to result in the outcome envisaged. In the Supreme Court case of Sheedy v the Information Commissioner [2005] 2 I.L.R.M. 374, [2005] 2 IR 272, [2005] IESC 35 Kearns J. stated that "[a] mere assertion of an expectation of [prejudice] could never constitute sufficient evidence in this regard”.
Section 36(2) provides for a number of exceptions to section 36(1), while section 36(3) provides that a record to which section 36(1) applies may be granted if the public interest would, on balance, be better served by granting than refusing to grant the request.
Section 35(1)(a) is concerned with information given to an FOI body, and therefore cannot apply to details such as the Regulator’s analysis of or views on matters relating to PLI, including on any such information that was provided to or obtained by the Regulator in the course of its investigations/reviews.
I do not intend to deal at length with whether each test of section 35(1)(a) is met in relation to records containing information provided to the Regulator by PLI. However, it is well settled that the provision does not apply simply because correspondence is marked as confidential. Neither does it (or any other provision in the FOI Act) necessarily apply because records may contain or reflect legal advice received by PLI.
In particular, in relation to the third requirement of the exemption as outlined above, the Regulator does not accept that releasing the relevant records would be likely to prejudice the giving to it of further similar information from PLI or other persons. PLI accepts this position in respect of information that it is legally required to provide to the Regulator. However, it says that to be as constructive as possible, it also gives the Regulator details such as commercial plans, product pipeline, management issues, upcoming projects and relevant incidents. It also says that even when subject to an investigation, its replies go far beyond the de minimis standard and contain as strong a defence as possible. It says that it would curtail the comprehensive provision of such information if it was subsequently to be disclosed to the world at large, particularly if arguments in the records were “spun” and its reputation was affected.
While it is not apparent to me that the records contain details such as commercial plans, records containing such information may be subject to a duty of confidence further to the relevant Clause in the Licence. While such records may thus be exempt under section 35(1)(b), section 35(1)(a) does not necessarily also apply to them. Furthermore, records do not qualify for exemption under any provision in the FOI Act simply because of a possibility that their contents may be reported on by the media in a particular way or misunderstood by the general public.
The Regulator has legal powers to obtain from PLI all information that it needs to perform its statutory functions. Furthermore, PLI essentially acknowledges that it is in its interests to provide additional information during an investigation to ensure that its defence is as strong as possible. It is not clear to me why it would not continue to do so even if the records in this case were to be released.
I am not satisfied that the information meets the third and fourth tests in particular of section 35(1)(a). I find that the records are not exempt under this provision of the FOI Act.
PLI’s position seems to be that all of the records are covered by the confidentiality requirements in Clauses 20.6 and 16.4 of the Licence and that the records are as a class exempt under section 35(1)(b) of the FOI Act. The Regulator refused access to certain information in the records on the basis that it comprises confidential information for the purposes of Clause 20.6 in particular such as trade secrets and commercial plans. Its position is that the remaining details covered by this review are not covered by either Clause 20.6 or Clause 16.4. The original requester says that any duty of confidence arising out of the Licence is forfeited when that Licence is breached.
Clauses 20.6 and 16.4
Clause 206 provides that:
"Notwithstanding anything to the contrary in this Licence, the Regulator shall:
not, unless compelled to do so by law (in which event the Regulator shall forthwith notify the Licensee of such compulsion in writing), under any circumstances directly or indirectly disclose or divulge to any third party any of the Licensee's confidential information which may be provided to the Regulator pursuant to any provision of this Licence and/or the Act, without the prior written permission of the Licensee. The Licensee's confidential information shall include, without limitation, the Licensee's trade secrets, management accounts, financial structure, financial statements (whether audited or not), commercial plans, contractual arrangements with any third party, shareholders agreements and arrangements and details of the Licensee's human and other resources, management, policies and procedures unless such information is already in the public domain. The foregoing shall apply mutatis mutandis to any other confidential information of a third party provided by the Licensee to the Regulator".
Clause 16.4 provides that:
“Any information disclosed to the Regulator in terms of Clause 16.1 and 16.2 shall be subject to such confidentiality undertakings as may be advised to the Regulator at the time of such disclosure, provided that such confidentiality undertakings do not limit the Licensee’s obligations under the Act or this Licence to provide or disclose information to the Minister or the Regulator, as the case may be.”
Clause 16.1 is concerned with a non-exhaustive list of materials that “[t]he Licensee shall allow the Regulator to inspect at all times” in order to determine whether the provisions of the Licence are being complied with. It also requires PLI to allow the Regulator to conduct interviews with its employees. Clause 16.2 provides that, without prejudice to the generality of Clause 16.1, the Licensee shall allow the Regulator to carry out a review at any time of the Licensee’s operations in order to determine particular matters.
PLI says that its correspondence with the Regulator is marked with the words “confidential” or “Clause 20.6 of the Licence applies”. It says that, in any event, Clause 20.6 applies to all correspondence between it and the Regulator. It emphasises the words “without limitation” in the Clause and says that what comprises PLI’s confidential information is wider than simply the terms listed in the definition.
In relation to Clause 16.4, PLI says that the records relate directly and specifically to the Regulator’s inspections and/or investigations of PLI’s compliance with the Licence. It says that the matters at issue included inspections of its compliance with the Licence and its codes of practice and policies. It says that the records contain its legal arguments regarding the breach notifications. It says that these are confidential and often reflect legal advice, which offers a further protection against disclosure. It says that the Regulator has acknowledged that the communications are marked “confidential”. It says that the confidentiality undertakings did not operate to limit its obligations to disclose relevant information to the Regulator and there is no suggestion that it cooperated less than fully in any investigation.
PLI appears to accept that Clauses 20.6 and 16.4 are generally concerned with information about it that is provided to or obtained by the Regulator. It also says that information that is solely about the Regulator’s performance of its functions may not be exempt under the FOI Act. However, it says that information solely about PLI and information that concerns both PLI and the Regulator’s performance of its functions are covered by the Clauses. The Regulator does not consider the Clauses to have the wide meaning argued by PLI.
I considered Clause 20.6 in Case No 180257, in which PLI sought a review of the Regulator’s decision to grant partial access to records concerning unclaimed prize funds, applications for games and for other matters such as the testing of new lottery balls, draw based games lifecycles and amendments to game rules. Some of my views in that case are relevant to this review. In summary, the examples of confidential information listed in Clause 20.6 are not exhaustive. The Clause’s purpose is to protect information that PLI provides to the Regulator about its own private financial and commercial affairs and those of third parties with which PLI engages. However, it does not operate to protect arrangements as to the management of the Licence such as, in Case No 180257, the value of unclaimed prizes that have accrued to PLI since the commencement of the Licence. Having considered Clause 20.6 in the context of this review, I do not accept that it applies to records concerning the Regulator’s assessment of whether PLI has complied with the terms of its Licence.
Clause 16.4 was not raised by PLI in Case No 180257. It seems to argue that the entirety of the processes by which the Regulator performs an element of its statutory functions (i.e. deciding whether a particular matter complies with the Licence and/or PLI’s codes of practice and policies) is an inspection, interview or operational review for the purposes of Clause 16.4. PLI is also arguing that an undertaking of confidentiality applies to all information that the Regulator may become aware of in performing such a function.
In general terms, Clause 16.4 seems to me to be intended to protect information concerning PLI’s operations and commercial affairs that the Regulator becomes aware of further to an actual inspection of PLI’s materials or an interview with PLI’s staff or a review of PLI’s operations. However, I do not consider it to apply to views formed by the Regulator on PLI’s compliance with the terms of its Licence or other matters further to an inspection, interview or operational review. Furthermore, while Clause 16.4 refers generally to unspecified “data, information” and certain other types of material that may be inspected etc., it also requires PLI to advise the Regulator of the particular confidentiality undertaking that attaches to the relevant data, information, etc. I believe that this requires PLI to do more than, for instance, simply label correspondence as confidential or subject to the requirements of clause 16.4 or, as it does here, argue after the event that Clause 16.4 applies to particular material. Thus, it seems to me that not all information concerning PLI that the Regulator becomes aware of in an inspection, interview or operational review is as a matter of course subject to an undertaking of confidentiality.
To summarise, I do not consider Clauses 20.6 and 16.4 to require the Regulator to keep secret either the details or outcome of the process by which it considered whether PLI had complied with certain terms of its Licence and related matters. I do not accept that the records are covered as a class by Clauses 20.6 or 16.4 of the Licence. Neither do I accept that the Regulator owes a duty of confidence to PLI, or is otherwise subject to an undertaking of confidentiality, in relation to the records as a general class. I find that they are not, as a general class of records, exempt under section 35(1)(b) of the FOI Act. Furthermore, given that PLI has not identified any specific details in the records that it considers to be covered by the Clauses, I have no reason to consider whether section 35(1)(b) might apply to such parts of the records.
Although this is not a matter for this review in the circumstances, I should also say that I do not necessarily agree with the original requester’s rather broad and general argument that any duty of confidence arising out of the Licence is forfeited when that Licence is breached.
PLI’s main argument as to why section 36(1)(b) applies is that its reputation would be affected disproportionately by the disclosure of the records to the world at large. It explains how it monitors and tries to improve the National Lottery’s reputation. PLI says that it faces competition from off-shore competitors, which are not subject to the 2013 Act or the Licence, and which it says will draw attention to an historical snapshot of PLI’s alleged breaches. It says that the public will take a negative view of PLI which, in turn, will have a material impact on National Lottery ticket sales, the long term sustainability of the State Asset that is the National Lottery and funds created for good causes.
As well as saying that the disclosure of the records will generally affect its reputation, PLI identifies particular “Details” that it says, if disclosed, will cause such an outcome. I cannot outline its explanation in this regard because to do so would essentially disclose the Details.
Finally, PLI says that disclosing details of the content of its advertisements as contained in the Part A records will also damage its competitive position. It says that such disclosure will undermine any value generated by the intellectual property in those advertisements because its unregulated competitors could easily mimic the details concerned. It also says that details of commercial advertising strategies such as the timing of specific campaigns are exempt under section 36(1)(b) and gives an example of the first page of Attachment 1 to Record 3. It also highlights specific comments in records 11, 16 and 25 that it says should be withheld.
The Regulator says that it accepts that reputational damage is relevant in considering section 36(1)(b). However, it is of the view that PLI has not shown how such harm could arise from disclosure of the details it decided to grant in this case. It describes how it believes PLI to be overstating the harms that could arise from the release of the records. It says that it does not see how disclosing details of regulatory engagement could impact on PLI’s reputation. Rather, it is of the view that such release will give the public a full picture of an historical matter and its ultimate outcome and will not cause reputational damage to PLI. Neither does it believe that any impact on PLI’s reputation will in turn impact on the National Lottery’s reputation.
In addition, the Regulator does not accept that the details could be of use to by PLI’s competitors. It says that even if this is the case, PLI’s competitors will not benefit from having the details to the extent described by PLI. The Regulator says that certain details have been published in its 2017 Annual report and that others will be published in its 2018 Annual Report. It says that it is not aware of PLI’s competitors having benefitted from the details already published or of PLI’s sales being impacted upon. The Regulator says that PLI’s financial statements show that sales of National Lottery products have increased over the past few years. In this regard, I note that PLI accepts that certain details have been published. It says that “much of the information covered by the request is in the public domain already” and that release of the records would disclose far more information to the public than is necessary.
Analysis
I see no reason to find section 36(1)(b) to apply on the basis of PLI’s arguments regarding the impact of disclosure of the records on the State Asset that is the National Lottery. In particular, I note that the Regulator, whom the 2013 Act requires, amongst other things, to exercise his or her functions in such a manner as he or she considers most likely to ensure that the long-term sustainability of the National Lottery is safeguarded, does not consider the records to be exempt for such a reason. Neither does the Regulator appear to be of the view that any impact on PLI’s reputation will in turn impact on the National Lottery’s reputation.
Insofar as PLI claims that section 36(1)(b) applies because of the commercial impact on its own interests, I will deal firstly with the specific details that it has identified as particularly sensitive. I should also say that I will also have regard to certain arguments made by the Regulator in Case No 180257 and which I accepted in that case.
In particular, I accepted in that case that PLI is subject to direct market competition in the normal way from a "significant number of competitors" even though it is the only entity licensed to operate the National Lottery on behalf of the Minister and is the only entity that is subject to the requirements of the 2013 Act and the Licence. PLI’s competitors could benefit commercially by developing and launching games based on PLI's proposals. Disclosure of details that could facilitate cheating could cause material financial loss to PLI or prejudice its competitive position in the conduct of its business. Such outcomes would adversely impact on the reputation of the National Lottery and its long term sustainability.
However, I must also have regard to the fact that the content of the records here is quite different to that in Case No 180257. The information at issue in Case No 180257 included descriptions of PLI's proposed schemes for lottery games and game themes, game and prize plans, commercial strategies, technical processes and specific controls. I found that the weight of the public interest in withholding information concerning PLI's security processes and commercial plans was considerable and that, although the details relate to how the Regulator discharged its statutory functions, they should be withheld. While the records in this case relate to the discharge by the Regulator of its statutory functions, they also relate to PLI’s compliance with relevant legislation and the Licence under which it operates the State Asset that is the Licence, rather than to more commercial matters such as proposed games, etc.
I should also say that I do not accept PLI’s position that “much of the information covered by the request is in the public domain already”. I note that certain details about the Part A and Part B investigations are in the public domain. I also note the Regulator’s position that it intends to publish some details about the Part C and Part D investigations in its Annual Report for 2018. Overall, it seems to me that the records contain considerably more detail than that which the Regulator has already placed in the public domain in relation to the Part A and B records and that which the Regulator is likely to place in the public domain in relation to the Part C and D records in its forthcoming annual report.
I note that certain information is also otherwise in the public domain in relation to the “Details”. However, I accept that PLI’s competitors could use the Details to impact on PLI’s reputation. I accept that section 36(1)(b) applies to the Details.
In the normal course it is not clear to me how the harm described by PLI could arise from the release of records outlining the contents of advertisements that have aired and have thus been placed in the public domain. It seems to me that such details would already available to PLI’s competitors to use if they chose to do so. However, I note that the Part A records are concerned with an advertisement that PLI has withdrawn. The second paragraph of record 2 describes that advertisement in detail. Other parts of record 2 and other Part A records also refer generally to the advertisement. I accept that disclosing this material into the public domain afresh could result in the harm envisaged by PLI. I find that such excerpts are exempt under section 36(1)(b) of the FOI Act.
PLI refers to the first page of Appendix 1 to record 3 as an example of a record referring to its commercial advertising strategies such as the timing of specific advertising campaigns. It has not explained how its competitors would be able to use the particular details concerned such that I can accept that disclosing them could prejudice PLI’s competitive position in the conduct of its business. I do not accept that section 36(1)(b) applies to such excerpts, accordingly.
PLI refers to a comment in record 11 that is repeated in other records, which it says is both confidential and commercially sensitive. I note that the Regulator’s decision to PLI of 21 February 2019 is more detailed than that which issued to the requester. It says that similar information is publicly available. The decision also refers to a report published in 2018, which itself says that it had regard to PLI’s LinkedIn account. PLI says that the report that was prepared for certain stakeholders whose interests appear to be adverse to its own and may have been read by the Regulator out of context. It appears to be arguing that the material on its LinkedIn account is not sufficiently detailed for the Regulator to have taken the view that the information in record 11 is effectively in the public domain. PLI goes on to say that the particular wording in record 11 will create a false impression regarding its profitability. However, I also note that in its response to the Regulator’s consultation under section 38, PLI says that its competitors will use this information to calculate the profitability of its ticket sales. It says that its competitors will thus be enabled to compete more aggressively by offering incentives or special offers that do not require various safeguards stipulated by the Licence and/or that have been agreed. It says that this will result financial loss to PLI and potential damage to players.
Even if the particular detail in record 11, or similar, is not already in the public domain, it is not clear to me how it qualifies for exemption under section 36(1)(b). Information is not so exempt simply because it may cause a misleading impression amongst the general public. I also note that in response to the Regulator’s section 38 consultation, PLI made the different argument that the detail enables calculation of the profitability of ticket sales. Regardless of which is PLI’s position, it is not clear to me how such outcomes could of themselves enable third parties to compete more aggressively with PLI. It seems to me that such competitors are already in a position to offer incentives and special offers to compete with PLI. I do not accept that section 36(1)(b) applies to the comment in record 11 (as repeated in other records).
Insofar as the details in records 16 and 25 are concerned, PLI does not explain why they are commercially sensitive for the purposes of section 36(1)(b). I have no reason to find these details to be exempt.
I will now consider PLI’s overarching argument i.e. that the records (including those excerpts I have dealt with above) should be found to be exempt in full under section 36(1)(b) because of the impact that their disclosure will have on its reputation. As already noted, I accept that disclosure of the records will provide considerably more detail about the subject matter of the records than what the Regulator has already placed or proposes to place in the public domain about these matters.
The Regulator says that the records comprise legal letters and submissions with very little commercial information, which it decided to redact in any event. It says that the arguments are in response to legal matters relating to the Regulator’s performance of its functions rather than commercial matters. Having examined the records, I agree. I also note its position that releasing the records will give the public a full picture of an historical matter and its ultimate outcome and will not cause reputational damage to PLI. It also seems to me that the fact that PLI is regulated may give PLI an opportunity to present itself as a responsible provider of lottery games in a way that its competitors cannot. While I do not consider the records to meet the harm test in the first part of section 36(1)(b) (i.e. that disclosure "could reasonably be expected to result in material loss or gain"), the standard of harm that is required for section 36(1)(b) to apply on the basis that disclosure of the information could prejudice an entity’s competitive position in the conduct of its business is low. I accept that the details in the records could be used by PLI’s competitors in a way that could affect PLI’s reputation amongst those persons who usually play Lottery games and to encourage them to play games offered by those competitors. I find that section 36(1)(b) applies.
Exceptions to section 36(1)(b) - sections 36(2) and (3)
I do not consider section 36(2) to be relevant in this case. In relation to section 36(3) and on the matter of where the public interest lies, I have had regard to the comment by the Supreme Court in the Rotunda case that a public interest is "a true public interest recognised by means of a well known and established policy, adopted by the Oireachtas, or by law". Although this comment was made in relation to another provision of the FOI Act, I consider it to be relevant to consideration of public interest tests generally.
PLI says that such disclosure is not in the public interest because it could damage its interests and those of the National Lottery and also impact on monies payable to good causes. It says that unlike the Regulator, which subject to obligations under the FOI Act, PLI is a private entity. It says that there is sufficient disclosure within the Regulator’s annual reports. It says that disclosure would negatively affect the relationship it has with the Regulator which is rooted in the full disclosure of sensitive commercial information, which is necessary to address various issues that arise in the day to day running of the National Lottery. It says that this benefits the interests of players and ultimately the long term sustainability of the National Lottery and distribution of funds to good causes. Finally, PLI says that the National Lottery is an asset of the State and that there is a significant public interest in upholding its reputation, particularly given the increased competition faced by PLI/the National Lottery. It says disclosure of the records would breach the requirements of the National Lottery Act for the Regulator to have regard to the reputation of the National Lottery in the performance of several of its functions.
The Regulator’s decision to PLI outlines various public interests it says it took into account in making its decision. These include the public interest in revealing how an FOI body performs its functions and in the general public being able to assess whether those functions are being discharged properly. They also include the public interest in increasing the openness and transparency of decisions taken by FOI bodies. The Regulator also says that it must consider the long term sustainability of the National Lottery, which in appropriate cases is not limited to the Licence’s 20 year term. It says that disclosing the records would “help underline the independent nature of this Office as provided for under the 2013 Act and engender public confidence regarding the performance of the Office’s functions in this regard which is in the best long term interests of the National Lottery”. In its submission to this Office, the Regulator also says that if PLI is correct in arguing that disclosure of the records in this case is in breach of the 2013 Act, then it would be severely restricted in performing its statutory duty to enforce compliance with the Act. It says that the Oireachtas could not have intended this.
The original requester says that because the request relates to breaches of the Licence in relation to marketing communications, the public interest outweighs any privacy concerns.
It seems to me that there is a general public interest in this case in promoting openness and accountability regarding how the Regulator carries out its functions. It is entitled to considerable weight given that the relevant function in this case concerns how the Regulator ensures that PLI complies with the terms of its Licence in operating what is a valuable State asset. I accept that the public interest is served to some extent by the limited information that has been published by the Regulator. However, granting access to the records would further serve this public interest by disclosing why the Regulator carried out the investigations concerned, the nature of the enquiries made and responses given and the consideration given to them, as well as how the outcomes were arrived at. It will also enable the general public to assess the appropriateness of the Regulator’s views and actions.
As I said in Case No 180257, the fact that the Oireachtas passed the 2013 Act indicates that there exists a true public interest in protecting the interests of the National Lottery. I have already found that the records are not exempt on the basis that their disclosure will have an impact on the National Lottery of the sort envisaged by section 36(1)(b) of the FOI Act. However, in any event, it is relevant that the Regulator is of the view that granting access to the records would serve this public interest. I agree with the Regulator’s position that the release of records under the FOI Act cannot be in conflict with the provisions of the 2013 Act. If this were the case, the Oireachtas would have made the necessary legislative arrangements. I should also say that there may, in general terms, be a public interest in ensuring an open relationship between PLI and the Regulator in the context of ensuring the long term sustainability of the National Lottery. However, it is significant that the Regulator is clearly of the view that any such public interest is outweighed by the public interest in ensuring openness and accountability regarding how it performs its statutory function of ensuring that PLI complies with the terms of its Licence.
On the other hand, section 36(1)(b) itself reflects the public interest in the protection of records containing information that could prejudice a private company's competitive position in the conduct of its business. This Office takes the view that the FOI Act was designed to increase openness and transparency in the way in which FOI bodies conduct their operations and, in general terms, it was not designed as a means by which the operations of private enterprises were to be opened up to scrutiny. However, while PLI is indeed a private company, it is nonetheless the only one that operates the National Lottery, which it does on behalf of the State. This is a particularly relevant consideration in this case and reduces the weight of the public interest in withholding the records.
I recognise that I took the view in Case No 180257 that, by extension, the 2013 Act indicates that there also exists a true public interest in protecting the interests of PLI. While I have no reason to depart from this view, the particular context of the two cases and the different content and context of the records is relevant.
As I have said earlier, it seems to me that by being regulated, PLI is enabled to present itself as the sole, officially regulated provider of National Lottery games and derives a certain advantage over its unregulated competitors. It seems to me that this also reduces the weight attaching to protecting PLI’s interests in relation to the particular records at issue. Having considered the matter very carefully, I find that the public interest weighs in favour of granting access to the records, including, for avoidance of doubt, the “Details” discussed earlier in the decision.
I have identified one exception to the above. As noted already, the second paragraph of record 2 describes in detail an aired advertisement that has been withdrawn. Other parts of record 2 and other Part A records refer to this advertisement in more general terms. I do not consider the public interest to require disclosure of the detailed description of the advertisement, particularly having regard to the reasons why it was withdrawn. While some harm could be caused to PLI by the disclosure of the remaining more general details about the advertisement, I consider that the public interest in ensuring openness for the Regulator’s performance of its functions to outweigh the public interest in withholding those details.
Finally, I considered whether it is possible to direct that only parts of the records under review should be released in the public interest, which is the approach I took in Case No 180257. In summary, given the different likely impact of release of the various details in that case I decided that the public interest weighed in favour of withholding details of PLI’s proposals, supporting submissions and criticisms that would directly and/or indirectly reveal aspects of PLI's commercial plans. However, I decided that the public interest weighed in favour of releasing criticisms that were couched in terms of the Act under which the Regulator performs its functions, and certain details in the records that relate to PLI but which are more indicative of the Regulator's actions.
The details at issue in this case are quite distinguishable from those in Case No 180257. They are not concerned with commercial plans. Rather, they concern whether PLI’s actions comply with the terms of the Licence under which it operates the State asset that is the National Lottery. I accept that some of the details of and observations on those actions may be couched more in terms of the relevant legislation or in terms of the Licence than are other details and observations, which are couched in terms of the actions or alleged breach themselves. Having carefully considered the records, I do not consider it practicable to seek to identify and redact the latter type of information. In any event, it seems to me that this would make the ensuing copies of the records misleading and in breach of section 18.
Having carried out a review under section 22(2) of the FOI Act, I vary the Regulator's decision.
In relation to those details covered by my review (i.e. the parts that the Regulator decided to grant), I find that section 36(1)(b) applies to the records but that the public interest weighs in favour of granting access to them except for the second paragraph of record 2.
I direct the Regulator to grant access to the rest of the information covered by my review.
Section 24 of the FOI Act sets out detailed provisions for an appeal to the High Court by a party to a review, or any other person affected by the decision. In summary, such an appeal, normally on a point of law, must be initiated by the requester not later than eight weeks after notice of the decision was given, and by any other party not later than four weeks after notice of the decision was given.
Elizabeth Dolan
Senior Investigator