Behind closed doors

Posted: 19th November 2013

DoorknobIn the context of a Competition Commission investigation into the workings of the UK private healthcare market, a tribunal has tackled the thorny issue of how the rules of natural justice and witness confidentiality should be balanced.

The Commission was engaged in an in-depth inquiry as to whether features of the relevant market were having an adverse effect on competition. In the course of the investigation, it had received a large volume of confidential information from persons involved in the market or having knowledge of the way it operated.

Three companies engaged in private healthcare provision had sought disclosure of the confidential material with a view to responding to it. However, such access had only been permitted on a heavily restricted basis. The companies’ external advisers had been granted sight of certain material in a strictly controlled ‘disclosure room’ subject to tough undertakings relating to onward communication.

The Commission had ultimately published a summary of its preliminary findings in such heavily redacted form that the sense of important parts of the text was entirely lost. Challenging the Commission’s stance before the Competition Appeal Tribunal, the companies argued that they had been kept in the dark to such an extent as to undermine their ability to meaningfully respond or participate in the inquiry.

The Tribunal noted that the case raised in stark form a conflict between the public interest in protecting information given to the Commission in confidence and the rights of the companies whose commercial interests were potentially at stake.

Ruling in favour of the companies, the Tribunal found that the disclosure room regime adopted was ‘fundamentally flawed’. The Commission had breached its duty under Section 169 of the Enterprise Act 2002, as well as the rules of natural justice, in comprehensively failing to afford the companies a fair opportunity to correct or contradict its provisional findings or to make worthwhile representations.