CEFIC Sees “Dangerous Precedent” in ECJ Ruling

28.11.2016 -

A ruling by the European Court of Justice (ECJ) on Nov. 23 that could facilitate public access to business information submitted by companies for EU substance and product registrations and approvals sets a “dangerous precedent,” the Chemical Industry Council (CEFIC) said. CEFIC’s comments were made in response to the ECJ’s rejection of an appeal by the European Commission, supported by the European chemical producers’ trade association and several other international industry organizations, against a 2013 ruling of the European General Court widening access to documents the organizations’ members regard as confidential.

In its appeal, the Commission had asked the court to set aside the general court’s partial annulment of the EU governing body’s denial of a request by the Pesticide Action Network Europe and Greenpeace for access to Germany’s draft assessment report on the herbicide active ingredient glyphosate, which led to the initial authorization for placing glyphosate on the market as an active substance. The debate centers around the courts’ interpretation of the EU’s Aarhus Regulation, under which the public may access documents pertaining to the protection of the environment. At the same time, the regulation sets down rules under which a request for information could be denied.

Grounds for denial could be valid, the rules say, if the disclosure would adversely affect the confidentiality of commercial and industrial information, where a legitimate economic interest needs to be protected. However, at the same time, the EU law suggests that if an overriding public interest in disclosure is seen to exist it must be granted. Last week’s court decision “would make it easier for any member of the public – and any competitor in Europe and abroad – to access valuable commercial data submitted by business to EU authorities even if this is proven to cause harm,” CEFIC said in a statement.

“While understanding legitimate public interest in transparency, there has to be consideration for situations where making confidential business information public exposes a company to competitive risk,” the organization’s director general, Marco Mensink, said. “How can a company confidently invest in developing new products or processes when its competitive edge can be given away?”

“Confidentiality protection is a fundamental part of existing EU chemicals laws such as REACh and biocides legislation, so that competitors are prevented from accessing commercially valuable data.” Mensink added. “One of the most valuable assets of a chemical company is considered to be the composition and method of manufacture of its products. If obtained by competitors at low cost, the innovator is deprived of the expected return on investment and may suffer up to 60-70% global sales in niche markets.

In a related case, the ECJ set aside an earlier judgment that denied a request from the Dutch bee preservation group Stichting de Bijensichting for information on the authorization process for the neonicotinoid pesticide imacloprid produced by Bayer CropScience. As the subject matter of both judgments, as many observers have noted, is complex and open to several interpretations, both of the cases will be sent back to the general court for a new assessment of the facts in the light of the considerations set out in parts of the latest judgment. The parties to the dispute will have the opportunity to make submissions