PARLIAMENT: battle moves to Council of Ministers

The European Court of First Instance has given hope to in-house lawyers in their battle for legal professional privilege in the wake of a warning that European Parliament moves to secure it are unlikely to succeed.

Handing down an interim ruling in the Akzo Nobel Chemicals case - which involved the European Commission seizing documents prepared by the company's in-house lawyers - the court found prima facie merit in the argument that legal privilege should be extended to cover in-house lawyers in competition cases.

The commission refuses to recognise privilege in such circumstances.

Jettie Van Caenegem, vice-president of the European Company Lawyers Association, said: 'The judge said the privilege issue required a debate on its merits in the main hearing.

He also inferred that privilege could be extended to cover advice relating to compliance programmes as well as litigation.

'The Akzo Nobel case provides substantial hope for in-house lawyers, but any practical impact could be years off.'

Last month, the parliament adopted the EC merger regulation, with amendments which would introduce privilege in competition cases.

However, June O'Keeffe, the Brussels-based head of EU and World Trade Organisation affairs at the Law Society, said: 'This is still being debated in the Council of Ministers.

The council looks very unlikely to accept parliament's amendments.'

Arguments in the council relate to the parliament's proviso that in-house lawyers must be members of professional associations to qualify for privilege.

There is a lack of parity in the organisations that in-house lawyers are permitted to join across the EU.

Rachel Rothwell