Terra Services Ltd, R (On the Application Of) v National Crime Agency & Ors

Under sections 13 and 16 of the Crime (International Cooperation) Act 2003, the UK Central Authority need not choose between a search warrant and a production order before directing that an application be made. It may issue an alternative direction, provided it has undertaken the limited scrutiny required by public law and the request is not obviously flawed, incoherent or misplaced.

The operational authority must then conduct the PACE-compliant assessment of the appropriate measure and satisfy the statutory warrant criteria. The UK Central Authority is not institutionally responsible for that assessment. Full and frank disclosure remains required on an ex parte warrant application, but an arguable non-disclosure does not necessarily justify permission where it could not have affected the outcome. Judicial review is ordinarily inappropriate for matters falling within the jurisdiction of the Investigatory Powers Tribunal absent exceptional circumstances.

The National Crime Agency executed a PACE search warrant at a storage unit containing documents belonging to Terra Services Ltd. The warrant followed a US Letter of Request concerning suspected money laundering, tax offences and fraud, and a direction by the UK Central Authority under section 13 of the Crime (International Cooperation) Act 2003.

Terra challenged an alleged covert-search authorisation under section 93 of the Police Act 1997, the application for and terms of the warrant, and the Secretary of State’s direction. The court considered whether the UK Central Authority had to select a single statutory measure, whether it had undertaken sufficient scrutiny, whether the warrant application involved material non-disclosure or failed the PACE criteria, and whether the alleged authorisation could be reviewed judicially.

1. Authorisation. The claim concerning the alleged section 93 authorisation was within the ordinary jurisdiction of the Investigatory Powers Tribunal under section 65(2) of the Regulation of Investigatory Powers Act 2000. No exceptional circumstances justified judicial review. The asserted link between the authorisation and the warrant fell away because Terra accepted that invalidity in the authorisation would not undermine the warrant. The storage unit was not arguably “office premises” under sections 97 and 97(8) of the Police Act 1997: passive storage was neither an office nor an office purpose under the Offices Shops and Railway Premises Act 1963.
2. Direction. Sections 13 and 16 of the Crime (International Cooperation) Act 2003 establish a division of responsibility. The UK Central Authority must decide whether the request should be accepted and must ensure that it is not so obviously flawed, incoherent or misplaced that any application based on it would be pointless. It need not determine whether a warrant or production order is appropriate, or conduct the PACE inquiry required of the operational authority.
3. The direction to apply for “a search warrant (or other appropriate measure)” was lawful. A warrant and a production order overlap because a warrant must satisfy the production-order criteria as well as additional cumulative conditions. The relevant authority remains responsible for identifying the proper measure and must alert the UK Central Authority if the request or directed measure is plainly inappropriate. R (Propend) v Central Criminal Court [1996] 2 Cr. App. R. 26 was confined to the predecessor legislation or should not be followed.
4. Warrant. The duty of full and frank disclosure applies to an ex parte warrant application, including disclosure of facts militating against the warrant. The fact that a person connected with the storage unit was a practising solicitor ought to have been disclosed. Nevertheless, Terra did not show an arguable basis that the omission, the alleged legal archive, the breadth of the warrant, the absence of date parameters or the judge’s scrutiny could have invalidated the warrant. Date parameters are not a statutory requirement, although they may be appropriate where the investigation is temporally confined.
5. Permission was refused in relation to the authorisation and the warrant. Permission was granted in relation to the direction, but the application for judicial review of the direction was dismissed.