Kensington International Ltd.v Republic of the Congo

The privilege against self-incrimination may be claimed in civil proceedings where disclosure creates a reasonable, rather than fanciful, risk of prosecution or contributes a link in a chain of proof. The privilege extends to companies, but its possible extension to employees or officers protecting a company’s privilege was left undecided.

Section 13 of the Fraud Act 2006 removes the privilege in proceedings relating to property where the potential offence is a fraud offence or a related offence. Norwich Pharmacal proceedings ancillary to enforcement proceedings may fall within that description. Corruption offences may involve fraudulent conduct or purpose, and the provision applies to proceedings commenced after its commencement even where the underlying conduct occurred earlier.

Kensington International Limited, a judgment creditor of the Republic of the Congo, sought Norwich Pharmacal orders requiring two Vitol companies and two employees to disclose information and documents concerning alleged payments to Congolese officials or associated companies.

The Third Parties claimed privilege against self-incrimination under section 14 of the Civil Evidence Act 1968, relying on possible offences of bribery and corruption. Kensington argued that the risk was insufficient and that section 13 of the Fraud Act 2006 had removed the privilege. The issues concerned the risk of self-incrimination, the position of employees and company privilege, and the scope and temporal application of section 13.

1. Risk of self-incrimination. Applying Sociedade Nacional v Lundqvist [1991] 2 QB 310 and Den Norske Bank v Antonatos [1999] QB 271, the relevant risk was a reasonable apprehension of prosecution or exposure to material capable of contributing to a prosecution. It was unnecessary to establish a risk of conviction. The affidavits claiming privilege were not conclusive, but the allegations and underlying material established a real risk in respect of the generality of the requested disclosure.
2. The risk could arise notwithstanding that payments were made abroad by non-United Kingdom companies. The possible involvement of United Kingdom companies and individuals in providing the direction or practical assistance for bribery meant that the extra-territorial corruption provisions could not be circumvented by using foreign entities. Privilege would therefore have applied to the generality of the disclosure but for section 13 of the Fraud Act 2006.
3. The court identified peripheral categories of information which might not create a relevant risk, including payments involving a non-United Kingdom company and Mr Chautard, payments involving Mr Lambroza before he became a United Kingdom national, and other payments not exposing the Third Parties to the relevant risk. Disclosure of such material was ordered if it existed, with affidavit confirmation if it did not.
4. The question whether employees or officers could claim privilege to protect their company’s privilege was academic because their personal positions were practically co-extensive with those of the companies. The court expressed provisional reluctance to extend the privilege in that way, having regard to In re Westinghouse Uranium Contract [1978] AC 547, but reached no concluded view.
5. Section 13 applied. The Norwich Pharmacal proceedings were ancillary to proceedings for enforcement and recovery of judgment debts and therefore were properly considered in that context as proceedings relating to property. The corruption offences involved a form of fraudulent conduct or purpose, despite dishonesty not being an essential ingredient. Section 13 was evidential and applied to proceedings after its commencement, including proceedings concerning earlier conduct. Kensington was accordingly entitled to the disclosure sought, subject to the statutory protection that disclosed material would not be admissible against the person in later criminal proceedings.