Privacy International, R (On the Application Of) v The Commissioner for HM Revenue & Customs

Section 18 of the Commissioners for Revenue and Customs Act 2005 creates a prohibition on disclosure, but not an absolute bar. Disclosure may be made where the statutory exceptions apply, including where it serves an HMRC function or a relevant criminal investigation.

The exercise of the power is fact-sensitive. HMRC must consider the status of the person seeking information, the nature of the request, confidentiality, investigative risks, public confidence and the public interest in accountability. It must not rely on generic or abstract reasons.

Where a serious complaint may have been closed without prosecution, affected persons with standing should ordinarily be informed of the decision and reasons, subject to exceptional countervailing circumstances.

Privacy International sought judicial review of HMRC’s refusal to provide information about alleged unlicensed exports of surveillance equipment by Gamma International. It asked whether HMRC had power or duty to disclose information about any investigation, its progress, and any decision to take no further action.

HMRC’s initial correspondence treated section 18 of the Commissioners for Revenue and Customs Act 2005 as preventing disclosure to third parties. During the proceedings HMRC accepted that section 18(2) conferred a fact-sensitive power to disclose, but maintained that disclosure was inappropriate. The central issues were the lawfulness of the original decision, the relevant factors governing the discretion, and the circumstances in which a complainant should receive notification and reasons for a no-further-action decision.

1. The application succeeded. The decision was quashed and remitted to HMRC for reconsideration.
2. Section 18(1) of the Commissioners for Revenue and Customs Act 2005 establishes a prohibition on disclosure, reinforced by the criminal offence in section 19. The prohibition is qualified by section 18(2)(a) and (d). It is therefore wrong to treat section 18 as imposing an absolute prohibition on disclosure.
3. The relevant statutory functions include HMRC’s investigative and enforcement functions under the Export Control Order 2008, the Customs and Excise Management Act 1979 and the Police and Criminal Evidence Act 1984 (Application to Revenue and Customs) Order 2007. There is no freestanding function to provide information, but disclosure may be connected with an existing statutory function.
4. The section 18 evaluative exercise must be anchored in the facts. HMRC must consider the identity and status of the person seeking information, the precise request, the sensitivity of the information, the actual risk to the investigation, possible confidentiality arrangements, reputational effects and the public interest in transparency and confidence in the export-control system. A partial disclosure may be appropriate.
5. The decision was unlawful because it was made without consulting the operational unit handling the complaint and without considering the complaint dossier. The decision letter contained an error of law and relied on generic reasoning divorced from the facts. Later witness evidence could not rewrite the decision.
6. At common law, persons with proper standing to challenge a decision not to prosecute have a strong interest in being told that the decision has been made and, ordinarily, why. A decision maker cannot avoid review by leaving a file dormant. Exceptions may exist in unusual cases involving serious countervailing interests.
7. The Framework Decision and Council Directive may confer additional rights where a complainant qualifies as a victim. The judgment did not finally determine whether the activists fell within those definitions. Article 10 of the Convention did not require a separate conclusion because the common law and, where applicable, EU-law principles were sufficient.
8. The court declined to require HMRC to issue general guidelines.