Do you have a concept of legal privilege in your jurisdiction which applies to lawyer-led investigations? If so, please provide details on the extent of that protection.
Bribery & Corruption (2nd edition)
In China, although there is not an equivalent regime of legal privilege which prevents the confidential communications between the client and the lawyer being disclosed to third parties, there is a general duty of confidentiality stipulated in the Law on Lawyers, which is imposed on lawyers to keep confidential any state secrets, trade secrets, and privacy obtained in the course of practicing law. The Criminal Procedure Law further provides the defence attorney with the right to refuse to disclose the relevant information of the client in criminal investigations and proceedings, however this is subject to a few exceptions where national security, public security, or individual’s personal security are endangered. However, for the administrative enforcement, no such protection is legally validated if the lawyer is requested by the authorities to disclose certain information pertinent to the client.
The notion of “legal privilege” in France differs from its British or American equivalent: it protects exchanges of any nature between lawyers registered with the Bar and their clients, which cannot be disclosed to third parties, including judicial or police authorities. This form of confidentiality is general, absolute and unlimited in time. Note that in France, exchanges with in-house lawyers -who cannot be registered with the Bar, as they are not deemed sufficiently independent- are not confidential.
On the specific question of internal investigations, in March 2016, the Paris Bar deliberated that such investigations are part of the professional scope of French lawyers and issued recommendations on how they should be led. In particular, in the course of such investigations, the investigating lawyer has the duty to let third parties know that their exchanges will not be confidential, so that the client will be entitled to use third parties’ statements, or any other information collected.
Please note that at present, French courts have not yet litigated on this question of privilege in the context of lawyer-led investigations.
Currently, the German law contains no provisions to determine lawyer-led investigations. Since the client-attorney privilege only applies in certain cases (section 97 (1) No. 1, 148 Criminal Procedure Code), it is unclear if the connection between an internal investigator and a client is legally protected.
Recently, the extent of the client-attorney privilege was brought to light in a decision by the Federal Constitutional Court (Bundesverfassungsgericht) when the public prosecutor searched the offices of the law firm Jones Day in Munich and secured documents related to the internal investigation at Volkswagen, led by Jones Day. The Federal Constitutional Court preliminary granted an injunction in favour of Jones Day and prohibited the use of the secured documents until a final decision was reached. The court’s final and eagerly anticipated decision was given on 26 June 2018. Pursuant to the decision, searching a law firm and maintaining the securing of documents prepared in the course of internal investigations and for the purpose of the investigations do not constitute a violation of constitutional law. The securing of the documents neither constituted a violation of Volkswagen AG’s right to informal self-determination nor its right to a fair trial. In addition, as an America-based law firm, Jones Day as well as their lawyers were not seen as a holder of fundamental rights and, therefore did not have standing to lodge a constitutional complaint.
Although internal investigations in Germany have become more frequent, German law does not determine the terms and conditions of internal investigations. Furthermore, according to their coalition agreement and as a consequence of the judgement of the Federal Constitutional Court, the present German government intends to adopt legal regulations for internal investigations.
However, the legal privilege applies to the lawyer’s communication with the client and is based on the effective right of defence (Art. 6 (3) of the European Convention on Human Rights and Art. 2 (1), 20 (3) of the German Constitution) and the right to refuse testimony (section 53 (1) No. 1 and 2 of the Criminal Procedure Code).
Greek Law recognises the legal privilege and, also, provides for it protection. Lifting the legal privilege by prosecuting authorities is not done through the general provisions for accessing information considered privileged (financial, tax etc) but following different, special procedures. Legal privilege applies to anything the lawyer has known or obtained because of his/her profession. In view of this, information acquired in lawyer-led investigations are, in principle, covered by legal privilege. There is uncertainty though in respect to the procedures to be followed during lawyer-led investigations either independently or within the context of an internal audit. In case of a dispute whether some information is connected to legal privilege, there are provisions for its resolution. These procedures take effect after securing/seizing such information, so it is always important to indicate in relevant correspondence and/or documents that they contain attorney-client privilege.
There are a number of types of legal professional privilege (LPP) recognised in Ireland.
Legal advice privilege applies to documents, the dominant purpose of which is the giving or receiving of legal advice.
Litigation privilege applies to confidential documents created with the dominant purpose of preparing for litigation that is pending or threatened or for the purpose of prosecuting or defending litigation.
Common interest privilege may also apply in the context of internal investigations where a document which would have been subject to LPP is given to a third party who may be said to have a common interest in the legal advice, litigation or regulatory process.
Increasingly, regulators are also recognising the concept of ‘regulatory privilege’ which covers documents created in apprehension or contemplation of a regulatory investigation, the dominant purpose of which is for the purpose of responding to or defending the regulatory investigation or prosecution.
Italian legal system provides for several rules that regulate legal privilege and that can to some extent apply also to lawyer-led investigations. Article 200 of the Criminal Procedure Code, for example, states that the lawyer is one of the persons who cannot be obliged to testify on what they have known by reason of their ministry, office or profession, except in cases where they are obliged to report to the judicial authority. Article 103 of the Criminal Procedure Code aims to broaden the protection of the defensive activity, guaranteeing to the defendant’s counsel a very high protection against the possibility for the Public Prosecutor to perform dawn raids and inspection at the lawyer’s office, seize documentation, eavesdrop phone calls, etc. Furthermore, articles 391 bis and following of the Criminal Procedure Code provide for the regulation of the so-called ‘defensive investigations’. The lawyers who perform such investigations are entitled with powers similar to those of a Public Prosecutor (they can question possible witnesses, ask them to release statements, etc.).
In Belgium, the concept of legal privilege exists. Its violation is criminally sanctioned (Art. 458 of the Criminal Code). Legal privilege is considered to be fundamental to the legal order of Belgium and a fundamental pillar of the right of defence. The specific provisions of the legal privilege are set out in the Codex Deontology for Lawyers (The European Deontology Codex (CCBE) also foresees the concept of legal privilege).
In Belgium, an Internal Audit is carried out by auditors who also have a legal privilege.
Japan does not have a legal concept of attorney-client privilege that protects attorney-client communications from the compulsory collection of evidence in government authority investigations.
However, attorneys are given the right to refuse seizure or testimony and can utilize these rights for protecting attorney-client communications. More specifically, the CCP provides that an attorney (including a foreign attorney registered in Japan) may refuse the seizure of articles containing confidential information concerning others which he/she has been entrusted with and retains or possesses in the course of his/her duties, and may refuse to give testimony in a trial on matters pertaining to confidential information concerning others which he/she came to know through entrusted professional conduct.
There is no concept of legal privilege which is specific to lawyer-led investigations. The Evidence Act provides legal privilege to advocates only in relation to communication made to an advocate in the course and for the purpose of his employment as such advocate. Such privilege does not cover communication made in furtherance of an illegal purpose or where the advocate observes any fact showing that a crime or fraud has been committed since the commencement of his employment. Section 27 of the Anti-Corruption and Economic Crimes Act is clear that EACC may not seek disclosure of information protected by advocate-client privilege.
Lawyer-led investigations are in many circumstances protected by the attorney-client privilege and the attorney work product doctrine. To ensure privilege, certain precautions should be taken. The legal investigative team and its support staff should ensure that communications concerning the investigation are kept confidential and shared with company personnel only to the extent necessary. In addition, should it be necessary to retain non-legal professionals, such as forensic accountants or other specialists, they should be directed and overseen by counsel to ensure that privilege extends to those individuals’ work.
The attorney-client privilege and attorney work product doctrine protects materials such as communications between attorneys and the company, attorneys’ notes or memoranda of confidential interviews with company employees, attorneys’ memoranda or other work product concerning the investigation and confidential communications between attorneys and experts who assist the attorneys. Importantly, facts are not privileged; however, communications with attorneys concerning those facts are privileged.
The general concept of professional secrecy is not lawyer-specific but is applicable to the practice of law. This concept is regulated under several laws; the CPEUM provides for the protection of private communications and establishes that acts against the privacy and freedom of such shall be sanctioned under criminal laws; Article 36 of the General Professions Law for Mexico City, which regulates Article 5 of the CPEUM, provides that professionals shall keep strict secrecy on matters disclosed to them by their clients.
Regulations for criminal and civil procedures contain provisions stating that persons that receive information by means of their job, position or profession, bound to professional secrecy, are not obliged to testify against their clients.
Pursuant to Article 140 of the LGRA, any person is obliged to assist the authorities within the investigation and resolution of cases involving administrative offences of corruption, except for relatives, spouses and those who have the obligation to maintain professional secrecy.
Confidentiality of the attorney-work product, communications, the inviolability of lawyer´s office and the attorney-client privilege are considered as fundamental rights under the Brazilian Federal Constitution. Thus, the duty of confidentiality is a public matter and must be observed by attorneys and the state.
The ethical and disciplinary code of the Brazilian Bar Association, Law No. 8,906 of 1994, expressively provides that the confidentiality duty cannot be waived, that is, even by the client.
Thus, a lawyer-led investigation is covered by the privilege and confidentiality protections. As mentioned above, the confidentiality duty is a public and not private matter.
Notwithstanding, there are discussions if the same confidentiality and privilege applies to in-house counsel. If the lawyer is the also an executive for the company (scenario that has been recurrent) privilege and confidentiality may not be assured.
New Zealand law provides statutory (Evidence Act 2006) and common law protection to communications involving the provision of legal advice by lawyers to their clients (legal advice privilege) and to communications when litigation is in contemplation (litigation privilege).
These protections are likely to apply in the course of lawyer-led investigations into corrupt activity.
Communications between lawyers and clients concerning the commission of any corrupt activity by either or both of them will not be protected. The common law fraud exception applies.
Under Danish law, the confidentiality between lawyer and client is recognised as a fundamental principle of the legal system. Consequently, it follows from the provisions of the Danish Administration of Justice Act that whether or not the police must be given access to documents and other materials produced or uncovered during lawyer-led investigations must be determined by the same legal standard applied when it is determined whether a lawyer can be compelled to testify/give evidence against his own client. This gives lawyer-led investigations considerable protection.
The national legislation knows the regulation of the lawyer's secret professional concept, relevant to this being the provisions of Law no. 51/1995 and Statute of the Lawyer profession.
According to these regulations, the subject of professional secrecy may be: consultations given or directed to the client, correspondence between the lawyer and his client, professional correspondence between a lawyer and lawyers, the notes made during the professional interview conducted by the lawyer with his client for the analysis of the facts or a judicial file or documents of legal relevance, the material support of the evidence provided to the lawyer in the interest of preparing and performing the defense, the testimonies received by the lawyer in the exercise of his profession, the names of the clients, the lawyer's professional agenda, the financial documents and the banking operations related to the professional benefits, customer relationship and, in general, any aspect of or related to the exercise of the profession.
In order to protect the professional secrecy of the lawyer, the law establishes guarantees for the right to refuse to testify, the inviolability of the headquarters, the particular regime of searches and the removal of documents from the attorney's office.
In order to reconcile the lawyer's privilege with the protection of professional confidentiality, the New Criminal Procedure Code provides for some exceptions to the general rules on the attorney's ability to witness by exempting him from the duty to give witness statements about those facts or circumstances whose secrecy or confidentiality may be opposed by law to the judiciary.
Singapore law recognises legal advice privilege and litigation privilege, both of which are codified under the Evidence Act. In summary:
- Legal advice privilege protects confidential communications with a lawyer made for the purposes of seeking or giving legal advice; and
- Litigation privilege protects confidential communications with a lawyer made in reasonable contemplation of litigation.
Under the Evidence Act, legal advice and litigation privilege apply in the context of both civil and criminal litigation.
However, the question of whether companies can avoid disclosure on grounds of privilege has not been tested in any reported case.
Legal privilege exists under Swiss law, in principle broadly protecting information exchanged with lawyers acting in their professional capacity as lawyers (but not if acting in a mere business capacity). Legal privilege also covers any auxiliaries of the lawyer, e.g. external accountants, forensic specialists etc. Based on the wording of the statutory law, this protection applies only to Swiss attorneys and EU lawyers authorised to practise in Switzerland, and it is not clear whether it also covers advice from external counsel from other jurisdictions.
In civil, criminal or administrative proceedings, documents do not have to be disclosed, and cannot be seized, if they are part of the communication between a person or business and outside counsel, irrespective of their location. Lawyers may also refuse to testify. The legal privilege only extends to external counsel; documents and communication from in-house counsel are not privileged under Swiss law.
Legal privilege fully applies to documents sent to or from external counsel, provided that these documents were created by Swiss attorneys or EU lawyers authorised to practice in Switzerland. Privilege does not extend, however, to pre-existing data or documents, even if it is handed or processed by a lawyer.
Sharing information with another target does not, in principle, amount to a waiver of the legal privilege.
In recent controversial decisions, the Federal Supreme Court has clarified that legal privilege does not extend to tasks outsourced to external counsel if the underlying legal obligation belongs to the company itself, namely compliance obligations relating to anti-money laundering laws. As a result, internal investigation reports analyzing breaches of the anti-money laundering provisions were held not to be legally privileged.
The concept of legal professional privilege in England and Wales is considered to be a fundamental human right. If a document is covered by legal professional privilege, it entitles the party claiming privilege to withhold production from those seeking to inspect it. That is so even where the party seeking inspection is a governmental or regulatory body. Documents will attract legal professional privilege provided that they meet the tests for legal advice privilege or litigation privilege.
Legal advice privilege covers confidential communications between lawyers (acting in their professional capacity) and clients for the purposes of giving or obtaining legal advice. It does not matter whether the advice sought relates to contentious or non-contentious matters.
Litigation privilege covers confidential communications between clients and their lawyers or between either of them and a third party for the purpose of obtaining information or advice in connection with existing or contemplated litigation, that were made: (a) when litigation was in progress or reasonably in contemplation; and (b) with the sole or dominant purpose of conducting that litigation. Crucially, the litigation must be adversarial, not investigative or inquisitorial.
Some documents generated in a lawyer-led investigation may well be covered by legal advice privilege. However, it is unlikely that documents generated in a lawyer-led investigation (or, for that matter, any investigation) will be covered by litigation privilege. That is because, as noted above, litigation privilege is concerned with adversarial litigation only.
As a practical point, the SFO is putting investigated parties under an increasing amount of pressure to waive privilege claims over documents, against the backdrop of co-operation which is necessary to secure a DPA. It has also challenged rules on privilege through the courts (see questions 23 and 25 below).
Solicitor-client privilege protects all communications between a professional legal advisor and the clients from being disclosed without the permission of the client. This privilege is held by client and not the lawyer, though it can be waived by either party.
The purpose behind this legal principle is to protect an individual's ability to access the justice system by encouraging complete disclosure to legal advisors without fear that disclosure of those communications may prejudice the client in the future.
In order to substantiate a claim of solicitor client privilege over an internal (lawyer-led) investigation conducted by a lawyer, the claimant must prove three elements on a balance of probabilities. First, it must be a communication between the client and their solicitor; second, it must entail the seeking or giving of legal advice; and finally, it is intended to be confidential by the parties. This requires the claimant to prove that the internal investigations were done for the dominant purpose of obtaining legal advice, or getting recommendations based on the facts that were gathered. Legal advice also includes ascertaining or investigating the facts upon which the advice will be rendered, and that investigation is an important part of legal service if it is connected to providing that legal service.
Another relevant form of legal privilege is that of litigation privilege. This privilege is more limited in scope and duration, covering only that which is gathered in contemplation of litigation, and terminates at the closing of said litigation. This could be relevant to information collected during an internal investigation, if the dominant purpose of the collection was for or in contemplation of litigation.
The Portuguese Bar Association Statute establishes attorney-client privilege that covers all facts that become known as a result of oﬀering of legal services and also the correspondence (all kinds of it).
The concept of Lawyer-led is not regulated in Portuguese law.
Attorney-client privilege in Argentina derives from the constitutional rights to defence and against self-incrimination (article 18, National Constitution). The Criminal Procedure Code establishes attorney client privilege by forbidding lawyers from testifying in court regarding secret information received from the client –unless client’s waiver (article 244), impeding courts from ordering the submission of witnesses or documents in violation of professional secrecy among other reasons (article 232), impeding the seizure of documents sent or delivered to defence attorneys for the performance of their duties (article 237), and excluding lawyers from being cited as expert witnesses in criminal proceedings in violation of privilege (article 255). Similarly, article 444 of the National Civil and Commercial Procedural Code allows witnesses to refuse answering questions when doing so would infringe professional secrecy.
Complementing these procedural rules, infringing attorney-client privilege is criminalized by article 156 of the ACC.
Besides, Law 23,187, which regulates lawyers’ practice in the City of Buenos Aires (each province of Argentina has its own bar association and regulations, although most of them have similar provisions), establishes that preserving attorney-client privilege is both a professional obligation, unless it is waived by the client (article 6.f), and a right (article 7.c). Additionally, it states that lawyers have the right to the inviolability of the law firm, safeguarding the constitutional right of defence (article 7.e).
Argentina’s legal framework does not distinguish between external or in-house lawyers’ privilege. Although legal privilege’s scope and standards are underdeveloped in case-law, it is expected that new precedents will emerge as a consequence of the entering into force of Law No. 27,401, which foresees internal investigations as an element of compliance programs.