This presentation by Francisco Enrique GONZALEZ-DIAZ, Partner, Cleary Gottlieb Steen & Hamilton, was made during the discussion “Treatment of legally privileged information in competition proceedings” held at the 128th meeting of the OECD Working Party No. 3 on Co-operation and Enforcement on 26 November 2018. More papers and presentations on the topic can be found out at oe.cd/tlp.

1. clearygottlieb.com
Legal Professional Privilege In Antitrust
Investigations
128th meeting of Working Party 3 on Co-operation and Enforcement
OECD, Paris, November 26, 2018
F. Enrique González-Díaz

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Three Categories of Legally Privileged Information in the EU
Treatment of Legally Privileged Information in Antitrust Proceedings
Treatment of Legally Privileged Information in Merger Control Proceedings
Criticism
Agenda
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What Is Legal Professional Privilege?
—The right of a lawyer and client to refuse to disclose communications that are
made for the purposes and in the interests of the client’s rights to be advised,
defended, and represented
—It is a fundamental right protected by the ECHR, the Charter and national legal
systems
—It is not confined to advice on antitrust related matters
—It imposes a limit on the Commission’s exercise of its powers of investigation

4. 4
Development Of LPP Under EU Law
European Courts first recognized Legal Professional Privilege (“LPP”) as a limit on the European
Commission’s investigative powers. Recognizing the principles and concepts common to the Member
States, EU law should protect the confidentiality of written communications between lawyer and client
subject to two conditions:
— The communications are made for the purposes and in the interests of the client’s rights of defence.
— The communications emanate from independent lawyers (not bound to the client by a relationship of
employment).
AM&S
The General Court upheld LPP over internal communications reporting the content of legal advice
received from external legal advisers holding that “the principle of the protection of written
communications between lawyer and client may not be frustrated on the sole ground that the content of
those communications and of that legal advice was reported in documents internal to the undertaking”.
HILTI
The General Court held that LPP could attach to preparatory documents, “even if they were not
exchanged with a lawyer or were not created for the purpose of being sent physically to a lawyer, may
none the less be covered by LPP, provided that they were drawn up exclusively for the purpose of seeking
legal advice from a lawyer in exercise of the rights of defense”.
AKZO

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EU Law, At A Minimum, Recognizes Three Categories Of
LPP
Working documents and
summaries prepared by the
client, even if not exchanged
with an independent, EU-
qualified lawyer or not
created for the purpose of
being sent physically to an
independent, EU-qualified
lawyer, provided that they
were drawn up exclusively
for the purpose of seeking
legal advice from an
independent, EU-qualified
lawyer in exercise of the
rights of defence.
WORKING/PREPARATORY
DOCUMENTS
WRITTEN COMMUNICATIONS INTERNAL NOTES
Written communications
with an independent, EU-
qualified lawyer made for
the purposes and in the
interests of the exercise of
the client’s rights of defence
in competition proceedings.
Internal notes circulated
within an undertaking which
are confined to reporting the
text of the content of
communications with an
independent, EU-qualified
lawyer containing legal
advice.

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How should the Commission treat documents protected by
LPP under foreign law?
—AM&S only identified the common principles and concepts among the Member
States
—Hilti and Akzo imposed no “place of qualification” requirement
—Commission in Akzo identified only employment status as dispositive
—Commission accepts that it is required to respect public international law in the
exercise of its powers
—Requiring production of documents protected by LPP under foreign law could
breach the principles of comity and non-interference

7. 7
Documents containing or reflecting legal advice from EU/US external counsel on competition law matters may
be redacted for privilege.
Documents containing or reflecting legal advice from EU/US external counsel on non-competition matters, but
which are nonetheless relevant for the competitive assessment of the transaction should not be redacted.
A possible blanket exemption (from the need to provide a privilege log) would only cover documents
originating from EU/US external counsel advising on competition law matters. The Commission would
nonetheless request a list (instead of a full log) of such documents.
So as to try to avoid waiver of privilege outside the EU, the Commission is prepared to (if it decides US in-house
documents are required and the parties cannot show they are Hilti-privileged) adopt a formal decision requiring
disclosure. It will not do so during the pre-notification stage. Indeed, the Commission may refrain from doing so even
during phase 1 if it does not consider disclosure necessary, and a phase 2 is avoided.
Adjudicating LPP Claims In Merger Proceedings
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In recent merger control proceedings, the European Commission has taken the view that it can require the
parties to provide a privilege log based on the following principles:

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Protecting The “First Link”
Does LPP cover requests for legal advice to external EU lawyers if those requests are first
communicated by a company employee to the company’s in-house counsel (the “first link”)?
— Commission appears to claim that the communication from the employee to the in-house
counsel is not protected by LPP because (1) it is not a communication with an EU outside
counsel; and (2) the company employee did not regard the communication as preparatory
to seeking legal advice from an EU outside counsel.
— This interpretation would be, in particular, at odds with Akzo, which protects preparatory
documents even where they were not exchanged with a lawyer and does not require the
lawyer in question to be an EU qualified outside counsel:
“such preparatory documents, even if they were not exchanged with a lawyer or were not created for
the purpose of being sent physically to a lawyer, may none the less be covered by LPP, provided that
they were drawn up exclusively for the purpose of seeking legal advice from a lawyer in exercise of
the rights of the defence”

9. 9
Observations
— LPP is an evolving concept, reflecting, as the Court held in AM&S, “such elements of that protection
[against disclosure] as are common to the laws of the Member States.”
— LPP is also a fundamental right, both under the ECHR, the EU Charter and national systems of law,
which the Commission is bound to respect.
— While LPP serves as a means to avoid disclosing certain documents, its purpose is not to conceal, but
to protect the rights of individuals and companies to secure proper legal representation.
• The parameters of that right therefore cannot be assessed based purely on the ability of individuals to pay for
representation.
— Proper respect for the rights of defence encourages, rather than diminishes, respect for the rule of law.
The fact that companies seek to invoke and protect their rights of defence should not be construed as
their having something to hide.

10. 10
“Legal Professional Privilege Under EU
Law: Current Issues,” by F. Enrique
González-Díaz and Paul Stuart, Competition
Law & Policy Debate, Vol. 3, No. 3,
September 2017, pp. 56-65
Article

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Throughout this presentation, “Cleary Gottlieb” and the “firm” refer to Cleary Gottlieb Steen & Hamilton LLP
and its affiliated entities in certain jurisdictions, and the term “offices” includes offices of those affiliated entities.