HSNO information sheet 10: How is confidential information protected?
Protecting commercially sensitive information
The Hazardous Substances and New Organisms (HSNO) Act 1996 provides some protection for commercially sensitive information. This information sheet outlines this protection. The application of the provisions of the Act may vary from case to case. We suggest that you obtain your own legal advice about how best to protect information that you believe is commercially sensitive.
GATT/TRIPS protection
TRIPS (The Agreement on Trade Related Aspects of Intellectual Property Rights) was among the agreements concluded in 1994 in the Uruguay Round of the General Agreement on Tariffs and Trade (GATT). The GATT is now administered by the World Trade Organisation, set up as a result of the GATT agreements.
The HSNO Act contains provisions (section 55(3) to (7)) intended to implement New Zealand’s obligations under the TRIPS agreement. These obligations refer to the relevant provisions in the Medicines Act 1981 and Animal Remedies Act 1967. The TRIPS agreement covers only information relating to “innovative” medicines, animal remedies and pesticides. Therefore, information relating to a large number of hazardous substances and new organisms controlled under the HSNO Act is not entitled to protection under the TRIPS agreement.
Medicines and animal remedies
If you manufacture or import an “innovative” medicine or animal remedy, certain information about those substances may be protected from disclosure to any person outside the Environmental Risk Management Authority. The HSNO Act protects information that “includes trade secrets or information that has commercial value that would be, or would be likely to be, diminished by disclosure” (section 55 (3) to (7)). Generally this information is protected for a period of five years. The details can be found in the Medicines Act 1981 and Animal Remedies Act 1967.
Pesticides
The protection provisions of the HSNO Act also cover pesticides. This was done when the Agricultural Compounds and Veterinary Medicines (ACVM) Act 1997 was passed by Parliament. This Act amended the HSNO Act to ensure that the protection required under the TRIPS agreement will extend to all innovative agrichemicals. The ACVM Act will probably be brought into force at the same as the hazardous substances parts of the HSNO Act.
Information provided before an application is lodged
The HSNO Act provides one further protection (section 55 (1)). Information supplied to the Environmental Risk Management Authority before an application is lodged is not subject to the Official Information Act 1982. Therefore another person cannot request this information under the Official Information Act. It is not necessary for the information to be “commercially sensitive” in order to be protected from disclosure to third parties.
The person supplying the information to the Authority can request that the information be returned, and the Authority must do so (section 55 (2)). However, once the application has been lodged the Official Information Act will apply. If an applicant wished to have information returned after an application had been lodged, the only way to do so would be to withdraw the application.
Withholding information under the Official Information Act 1982
All information held by the Environmental Risk Management Authority is subject to the Official Information Act 1982. Under that Act, any person can ask the Authority to provide them with copies of information held by the Authority.
The Official Information Act operates on a presumption that all information will be made available unless there is a good reason to withhold it. It sets out a number of grounds that can constitute "good reasons" to withhold information. One of these grounds is that the information is commercially sensitive.
The Official Information Act (section 9 (2)(b)) provides that there is good reason for withholding official information if, and only if, the withholding of the information is necessary to:
- Protect information where the making available of the information
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- Would disclose a trade secret; or
- Would be likely unreasonably to prejudice the commercial position of the person who supplied or who is the subject of the information.
The HSNO Act (section 57 (1)) provides that information which could be withheld under section 9 (2) (b) of the Official Information Act is not to be released when an application is publicly notified. Therefore, the public notice of an application will not contain any information that is “commercially sensitive”. For example, the notice could contain information about the effects of a substance or organism, without disclosing detailed commercial information about how the substance or organism is manufactured or developed.
The Act sets out a process (section 57 (2) to (4)) for the Authority to follow if a request is made under the Official Information Act for information that may be commercially sensitive. In most cases applicants would highlight information they consider to be commercially sensitive when they lodge applications (section 57 (2)(b)(ii)). However, there may be cases where an applicant has failed to do this, or someone other than the applicant has supplied the information. In these situations the Authority itself may believe that the information in question is commercially sensitive: subsection (2)(b)(i) of section 57 would then apply.
In either case the Environmental Risk Management Authority will advise the person who supplied the information that a request has been made to release it under the Official Information Act. The person who supplied the information must then convince the Authority that the grounds in section 9 (2) (b) of the Official Information Act apply. A response to the Authority's notice must be made within 10 working days – under the Official Information Act the Authority has only 20 working days to respond to the request to release the information.
The decision about whether the information should be released rests solely with the Environmental Risk Management Authority. Section 57 of the HSNO Act simply ensures that the Authority has all the relevant material before it decides whether to release the information.
The Case Notes from the Ombudsman on this issue* make it clear that “the availability of information under the Official Information Act is not dependent on the consent of the third party; it is dependent on whether or not good reason exists in terms of the Act to withhold it”. While the person who supplied the information may genuinely believe that the information is “commercially sensitive”, other considerations may mean that it is in the public interest to release it.
If you would like further information on the case history under the Official Information Act, contact the Office of the Ombudsmen.
*10th Compendium of Case Notes from the Ombudsmen, Office of the Ombudsmen, Wellington, June 1992. These case notes come in 2 volumes. Volume 2 contains notes of investigations under the Official Information Act 1982 and the Local Government Official Information and Meetings Act 1987.
Further information
For further information access the ERMA New Zealand website, or contact:
Dr S.R. Vaughan
Project Manager
Tel. 04 917-7404
Hazardous Substances and New Organisms Reform
Ministry for the Environment
PO Box 10362
Wellington
Fax 04 917-7523
