JP Morgan Chase Bank National Association & Ors v The Director of the Serious Fraud Office & Anor

Mutual assistance under the Crime (International Cooperation) Act 2003 is discretionary. The policy of international co-operation means that assistance should ordinarily be provided unless there are compelling reasons to refuse it.

The Secretary of State is not required to resolve genuine disputes about foreign law. However, the discretion cannot be exercised in favour of a request which is obviously unlawful, including where its unlawfulness is incapable of proper dispute. A request made by a prosecuting authority does not fail the statutory jurisdictional condition merely because that authority may lack competence to make the particular request.

Where a request plainly exceeds the requesting prosecutor’s powers, reliance on mutual assistance policy cannot cure the defect. The decision must be quashed if the unlawfulness materially affects the exercise of discretion.

The Banks sought judicial review of decisions by the Secretary of State for the Home Department and the Serious Fraud Office concerning a letter of request from the Public Prosecutor of Milan. The request related to Italian criminal proceedings arising from swap transactions between the Banks and the City of Milan.

The Secretary of State had referred the request to the SFO under sections 13 to 15 of the Crime (International Cooperation) Act 2003. The SFO then issued notices under section 2 of the Criminal Justice Act 1987 requiring the Banks to produce documents.

The Banks argued that the Prosecutor lacked authority under article 430 of the Italian Code of Criminal Procedure to issue the request during the trial stage, and that the Secretary of State had unlawfully exercised her discretion by acting on it. The central issues were whether the Secretary of State had jurisdiction, whether her discretion was properly exercised, and whether the request was obviously unlawful.

1. Jurisdiction. For section 13(2)(a) of the Crime (International Cooperation) Act 2003, an entity either is or is not a prosecuting authority. It does not cease to be one because its competence to issue a particular request is challenged. The jurisdictional challenge therefore failed.
2. General discretion. The Secretary of State had a discretion whether to arrange for evidence to be obtained. That discretion was informed by the policy of mutual assistance and the United Kingdom’s international obligations. Requests should ordinarily be acted upon unless there were compelling reasons not to do so. The Secretary of State was not required to conduct a criminal trial on paper or resolve genuine disputes of foreign law. Such matters would ordinarily be left to the courts of the requesting state.
3. The discretion was not confined to the refusal grounds in the Convention. Although refusal would be rare, it would generally be wrong to accede to a request which was obviously unlawful, namely one whose unlawfulness was undisputed or incapable of proper dispute. The Secretary of State was not a rubber stamp.
4. Article 430. On the Prosecutor’s own expert evidence, Italian law distinguished between a voluntary request for production of documents and coercive or invasive measures. The letter of request sought interviews and any requisite court order. Those terms could not sensibly be characterised as a request limited to voluntary production. The request therefore exceeded the Prosecutor’s residual authority under article 430 and was unlawful under Italian law.
5. The unlawfulness was obvious. The Secretary of State had considered the relevant Italian-law material and could test the request against the analysis of the Prosecutor’s own expert without resolving the competing expert opinions. Her conclusion that that evidence provided a coherent and full answer to the Banks’ challenge was untenable and Wednesbury unreasonable.
6. The obvious unlawfulness materially affected the interests-of-justice assessment and the exercise of discretion. The Secretary of State’s decision could not stand, and the SFO’s decision fell with it. The Court declined to save the request by restricting it to a voluntary document request, since that would require adjudicating on an amended request which had not been before the Secretary of State. Both decisions were quashed.