A draft directive will allow companies to sue whistleblowers who disclose information even if it is in the public interest to protect the environment, health and safety, according to lawyers at ClientEarth.
The trade secrets Directive was approved yesterday by the legal affairs committee of the European parliament by 19 votes to two. The law aims to harmonise protection for EU businesses from economic and industrial espionage.
It introduces an EU-wide definition for trade secrets, such as specific technology, recipes or manufacturing processes. Member states will be required to adopt measures to ensure that victims of the misuse of a trade secret can defend their rights in court and seek compensation.
The law contains safeguards to protect freedom of expression and information, the committee says.
However, ClientEarth claims that the directive represents a “massive clampdown” on journalists and whistleblowers, and will also discourage public authorities from disclosing information.
The law defines a trade secret as any information that “has commercial value because it is secret”. But this definition is so broad that it could apply to any undisclosed information, including the negative impact that business activities have on health and the environment, the NGO argues.
The commission claims that the law contains safeguards to protect journalists, since companies will not have the right to sue if the trade secret was disclosed under the right to freedom of expression and information.
However, ClientEarth warns that the the right to freedom of expression may be limited by laws that aim to protect the rights and reputation of others, which means that journalists could be penalised for disclosing business secrets.
The law also states that penalties will not be used against people who reveal conduct that is “illegal, wrongdoing, misconduct or fraud”, and was disclosed in the public interest. But ClientEarth says this test would be very difficult to meet for a lot of environmental information, such as information on chemicals in products that are legal, but still hazardous, and information on climate change.
The directive gives companies the right to seek compensation from public authorities that disclose information, even if they do so under freedom of information regulations. Public authorities already tread a fine line between public and commercial interests when deciding whether to reveal information publically, according to Anne Friel, a lawyer at ClientEarth.
She says that ClientEarth recently asked the European Chemicals Agency for information on the authorisation of a particular chemical. The agency initially said it was willing to disclose the information, but when the chemical manufacturer was informed it sued the agency.
“The threat of having to pay out damages if they get that decision wrong will tip the balance in favour of public bodies withholding more information,” she argued, adding: ‘It will prevent pressure being put on industry to improve the impact of their products and practices on public health and the environment.”
The Aarhus convention on access to environmental information should prevail over the trade secrets Directive in terms of requiring public authorities to disclose environmental information, said Friel. The draft law did not originally mention the convention, leading to concerns that public authorities may just ignore it. However, an amendment has now been added stating that to the trade secrets Directive does not affect the responsibility of public authorities to respect the convention.
A full parliament vote on the draft Directive is scheduled for July, while the council of ministers will consider it in September.
Meanwhile, a coalition of UK environmental charities under the umbrella of the Wildlife and Countryside Link has presented a joint statement on legal costs in environmental judicial review to the Aarhus convention taskforce on access to justice, which is meeting this week in Geneva.
The coalition argues that, despite bespoke cost rules being introduced in April 2013, legal costs in environment cases are still prohibitively high in the UK and the country is therefore in breach of the convention.
The charities also want the UK government to increase the timeframe for bringing a judicial review case. This was reduced to six weeks in 2013, but the coalition says that the short timeframe has made it difficult for community groups and NGOs to challenge decisions.
This article was amended on 22 June to state that the directive now contains a reference to the Aarhus convention.
