Are water companies subject to the Environmental Information Regulations 2004 (the EIRs)? That was the question that the Court of Justice of the European Union set about answering; last month it issued a decision that (in typical CJEU fashion) answered the question without actually answering the question.
On Thursday 19 December 2013 the Grand Chamber issued its judgment in Fish Legal and Emily Shirley v Information Commissioner, United Water Utilities Plc, Yorkshire Water Services Ltd and Southern Water Services Ltd (Fish Legal); while it doesn’t give a definitive answer to the question at the outset of this blog, it is an important judgment in respect of the question as to just who is subject to the EIRs.
Background
The EIRs (like the Environmental Information (Scotland) Regulations 2004 do in Scotland) implements into the law of Northern Ireland and England and Wales Directive 2003/4/EC, which in turn implements the Aarhus Convention into Community Law. The EIRs set out a framework in which members of the public can ask public authorities for ‘Environmental Information’, and to be provided with that information (subject to certain exceptions). Regulation 2(2) of the EIRs defines what a public authority is. The definition given by the Regulations is:
(2) Subject to paragraph (3), “public authority” means—
(a) government departments;
(b) any other public authority as defined in section 3(1) of the Act,
disregarding for this purpose the exceptions in paragraph 6 of Schedule 1 to the Act, but excluding—(i) any body or office-holder listed in Schedule 1 to the Act only in relation to information of a specified description; or
(ii) any person designated by Order under section 5 of the Act;
(c) any other body or other person, that carries out functions of public administration; or
(d) any other body or other person, that is under the control of a person falling within sub-paragraphs (a), (b) or (c) and—
(i) has public responsibilities relating to the environment;
(ii) exercises functions of a public nature relating to the environment; or
(iii) provides public services relating to the environment.
(3) Except as provided by regulation 12(10) a Scottish public authority is not a “public authority” for the purpose of these Regulations.
(In the EIRs “the Act” refers to the Freedom of Information Act 2000, or ‘the FOIA’)
Fish legal is the legal arm of the Angling Trust, and in August 2009 it wrote to two of the water companies concerned asking for information concerning discharges, clean-up operations, and emergency overflow. Emily Shirley wrote to the remaining water company seeking information from them concerning sewerage capacity. The three water companies concerned did eventually provide the information that was requested by the two applicants. However, the matter before the Upper Tribunal was whether the water companies were under a duty to provide the information as public authorities under the EIRs. Unsurprisingly, the three water companies (all private companies) took the view that they are not public authorities within the meaning of Regulation 2 of the EIRs and were thus not under any duty to comply with the EIRs. When the Information Commissioner considered complaints made by the two applicants under Section 50 of the FOIA (as modified by Regulation 18 of the EIRs) he agreed with the water companies and decided that they did not meet the definition of a public authority under the EIRs.
The two parties appealed the Commissioner’s decision to the First Tier Tribunal who eventually dismissed the appeals (following the Upper Tribunal’s decision in Smartsource v Information Commissioner and others), but gave leave to appeal to the Upper Tribunal. The Upper Tribunal decided to make a reference to the Court of Justice of the European Union.
Court of Justice’s Judgment
On the question of whether water companies are public authorities under the EIRs, the Court of Justice stated at paragraph [55] that it is for the Upper Tribunal to answer this question. A very helpful judicially penned sentence. However, the court of Justice did provide some guidance as to how the Upper Tribunal can reach a decision on this question. It went on to say in paragraph [56]:
In the light of the foregoing, the answer to the first two questions referred is that, in order to determine whether entities such as the water companies concerned can be classified as legal persons which perform ‘public administrative functions’ under national law, within the meaning of Article 2(2)(b) of Directive 2003/4, it should be examined whether those entities are vested, under the national law which is applicable to them, with special powers beyond those which result from the normal rules applicable in relations between persons governed by private law.
In essence the Tribunal has to look at the powers that the water companies have and determine from there whether the powers they have extend beyond those that would normally extend from the private law.
The Court of Justice then went on to consider the question of control of the water companies. The Directive, and in turn the EIRs, include any other body or person that is under the control of a body or person covered by the EIRs, and provides public services relating to the environment. There was no disagreement between the parties that the water companies provide public services relating to the environment. The only controversial aspect was whether they were under the control of a body or person covered by the EIRs. Under the Water Industry Act 1991 the privatised water companies are subject to regulation by Ofwat and the Secretary of State, both of whom are public authorities for the purposes of the EIRs; however, the question is whether the water companies are under the control of Ofwat and/or the Secretary of State. If they are, then they are public authorities for the purposes of the EIRs.
On the question of control the Court of Justice did not provide a definitive answer; however, it did give some guidance as to how the Upper Tribunal should determine whether the water companies are under the control of Ofwat and/or the Secretary of State. Where a person or body is not able to “determine in a genuinely autonomous manner the way in which it performs the functions in the environmental field which are vested in it, since a public authority covered by Article 2(2)(a) or (b) of the directive is in a position to exert decisive influence on the entity’s action in that field.” [68] So, in essence, if the autonomy that a water company has to decide how it is to carry out its public environmental functions is limited by the power of Ofwat and/or the Secretary of State, it will be under the control of them; and that will have the consequence of making the water company a public authority for the purposes of the EIRs.
The method by which power a public authority has over an entity carrying out public environmental functions is exercised does not matter much. The exercise of power could be as a shareholder; it could be the power to suspend or annul decisions taken by the company, or require prior authorisation before those decisions are taken; or it could the power to remove members of the company’s management (among other things). [70]
What now?
The Court of Justice may not have given a definitive decision as to whether water companies are public authorities; however, it has given an important decision that will enable the Upper Tribunal to answer the question. It also provides important guidance which will apply outside of the question of water companies. It is now up to the Upper Tribunal to make a determination on the water companies front; that decision will turn on two factors: (1) the degree to which the powers water companies have is beyond the scope that would normally be expected under the private law; and (2) the degree of control that Ofwat and the Secretary of State hold over the decision making of the water companies in respect of their public environmental functions.
I won’t venture an opinion on either of those questions; I don’t know enough about the water industry in England and Wales, nor do I care enough to learn, to make a judgment on either of those questions. I’ll happily leave it up to the Upper Tribunal to consider these points and decide upon them.
What about Scotland?
In terms of Scottish Water, the question is already settled. Scottish Water, being a public authority listed in Schedule 1 to the Freedom of Information (Scotland) Act 2002, is covered by Regulation 2 of the Scottish EIRs.
prout de jure 