Supreme Court judgment on legal professional secrecy of corporate lawyers in the Netherlands

Soon

On May 24, 2022, the Dutch Supreme Court ruled between, on the one hand, Royal Dutch Shell PLC and 15 of Shell’s in-house lawyers (“ Shell“), and on the other hand, the Dutch public prosecutor.¹ The Supreme Court ruled that the complaints of Shell and the public prosecutor were inadmissible because the decision of the court of first instance should be considered an “interim decision” (Dutch: “tussenbeschikking”) and interim decisions are not subject to cassation . . The Supreme Court took the opportunity to provide some clarification on the scope and application of corporate attorney-client privilege through obiter dictum.

This note provides a high-level overview of the Supreme Court’s findings on attorney-client privilege and a summary of the requirements for professional status (Dutch: “professioneel statutut”). In our opinion, this decision puts an end for the time being to the recurring debate on the question whether Dutch and foreign in-house lawyers can invoke the right to professional secrecy.

• The Supreme Court finds that under Dutch law, the starting point is that lawyers cannot be deprived of their right to legal professional secrecy simply because they work as corporate lawyers.
• Company lawyers must, however, be able to demonstrate that they can practice independently of their employers, while respecting the applicable ethical standards.
  1. Dutch corporate lawyers Registrants with the Netherlands Bar Association must prove their independence by signing the professional statute available on the website of the Netherlands Bar Association.^{of them}
  2. The calls ‘visit in-house lawyers‘ (lawyers, i.e. the equivalence of a lawyer, registered with the bar of a Member State of the EU, the courts of the European Economic Area and Switzerland) are subject to the same rules that Dutch lawyers and must therefore also sign the professional statute available via the website of the Dutch bar association or a similar agreement that sufficiently guarantees their independence from their employer, insofar as this is permitted by the laws of their country of origin. .
  3. Other foreign lawyers (lawyers registered in jurisdictions outside the EU, the European Economic Area and Switzerland) are subject to a double test to invoke professional secrecy:
     • nail. The foreign lawyer must be able to invoke professional secrecy in his home jurisdiction; Yes
     • b. the right to professional secrecy should also exist for a Dutch lawyer if he has carried out the specific activities in question.
  4. The Supreme Court also determines that to invoke legal privilege, a foreign national attorney must be able to demonstrate the existence of guarantees similar to those included and protected by professional status.
• The scope of professional secrecy only extends to information that has been entrusted to in-house lawyers in the course of their activity as lawyers. In other words, the information must be entrusted to the lawyer in his aptitude as a corporate lawyer (for example, not in a private or professional context). This must be determined on a case-by-case basis, so it is particularly important if the services provided by the in-house lawyer relate to pending or anticipated legal proceedings.
• Finally, the Supreme Court recalls that the Court of Justice of the EU has held that, under EU competition law, in-house lawyers cannot invoke the right to professional secrecy because they lack sufficient independence from their employers.³

professional status

In this judgment, the Supreme Court rules that the employer and the public defender must sign a professional statute (or, depending on their jurisdiction of origin, a similar agreement sufficiently guaranteeing the independence of the public defender vis-à-vis their employer ) for house lawyers to rely on legal professional secrecy. The Supreme Court held that this statute was a sufficient guarantee to protect the independence of all in-house lawyers, regardless of their place of registration. For Dutch in-house lawyers, the Dutch Bar has published a model professional statute (in Dutch) on its website. We summarize the provisions of this model below.

• The in-house lawyer must, at all times, disclose that he acts as an advocate (advocaat) both internally and externally.
• The employer must respect the free and independent professional practice of the lawyer and refrain from anything that could influence his professional performance and/or the strategy to be followed in legal matters.
• The employer allows the lawyer to fulfill his obligations related to his membership of the Dutch bar.⁴
• The employer must allow the lawyer to act in accordance with professional standards of conduct (e.g. conflict of interest rules, confidentiality, etc.) and the employer must provide adequate resources to enable the lawyer to properly practice your legal practice. .
• The employer is authorized to give instructions to the lawyer as long as these instructions are not contrary to the provisions of the professional statute.
• During the absence of the in-house lawyer for vacation, exceptional leave or illness, the employer must appoint a different lawyer to observe the functions of the in-house lawyer during his absence.
• The employer may determine that the lawyer must report to other in-house lawyers employed by the employer.
• The difference of opinion between the lawyer and the employer cannot constitute a reason for the unilateral termination of the employment contract by the employer, nor for the imposition of measures that may lead to it.
• The employer must not impose obstacles on the lawyer as to the activities to be carried out after the termination of employment (for example, a non-competition clause in your employment contract).
• In the event of a dispute arising between the employer and the lawyer concerning the application of the professional status, the parties may request mediation and/or advice from the president of the local bar association (Dutch: “de deken van de lokale order”). ) in the district where the prosecutor has his office.
• The professional status ceases to produce its effects when the employment contract expires or when the lawyer loses the status of collegiate lawyer.

Since the professional statute model is only available in Dutch and is adapted to the rules applicable to Dutch in-house lawyers, we recommend drafting a professional statute in English for all foreign in-house lawyers adapted to the specificities of every corporate lawyer. lawyer. attorney (for example, referring to obligations under the applicable foreign bar of the foreign/visiting domestic attorney jurisdiction). The Dutch model provisions should be the starting point for these professional statutes.

conclusion

In its judgment, the Supreme Court removed any doubt as to whether corporate lawyers have privileged rights: they do, under certain conditions. What particularly distinguishes internal counsel from external counsel is the employer-employee relationship which, in cases where the views of the employer and the internal counsel do not agree, can cast doubt on the required independence of the board. qualified lawyer. To this end, Dutch law requires the signing of a professional charter or similar agreement that sufficiently guarantees the independence of the corporate lawyer. This document should be signed as soon as possible (if not already done) by the in-house lawyers and the employer. We are more than happy to help you with this or discuss any other issues related to legal lien within your organization.

Once signed, guest in-house lawyers (i.e. lawyers registered in an EU Member State, European Economic Area jurisdictions and Switzerland) may invoke the right to professional secrecy of the lawyer in the Netherlands when they enjoy the same right in their country of origin. original too. Foreign corporate lawyers (i.e. lawyers licensed in jurisdictions outside the EU, European Economic Area and Switzerland) must also be able to demonstrate that their work in the Bas is of such a nature that, if carried out by a Dutch lawyer, the lawyer would be entitled to invoke the right to solicitor-client privilege.

1 HR 24 May 2022, ECLI:NL:HR:2022:760.

two https://www.advocatenorde.nl/praktijkuitoefening/samenwerking-en-praktijkstructuren/advocaat-in-dienstbetrekking.

2 HvJ EU, 14 September 2010, ECLI:EU:C:2010:512, NJ 2010/629, (Akzo Nobel Chemicals v Commission).

2 Article 3 refers to the obligations imposed by the Dutch Bar. Therefore, the professional status of foreign/visiting internal lawyers should refer to the requirements imposed by the applicable foreign bar association of the jurisdiction of the visiting foreign/internal lawyer.