Constitutional Court puts a brake on the right to information
The right to information, protected by the Charter of Fundamental Rights and Freedoms and further elaborated on in the Act on Free Access to Information and some other laws, is one of the evergreens of administrative justice. The Supreme Administrative Court (SAC) has been construing the right rather extensively: it has also included some business companies among those obliged to provide information. In a rather controversial decision, the Constitutional Court recently challenged this opinion.
For public administration to function properly, the public must have control over its activity. This idea forms the foundation for the regulation of the right to information. The Act on Free Access to Information (No. 106/1999), among others things imposes a duty on liable entities to provide information on their activity upon request. Exceptions are strictly defined: they include trade secrets and data to be kept secret under the law. The sore spot of the act is the definition of liable entities. Unsurprisingly, these include municipalities and administrative authorities. Yet, they also include ‘public institutions’ – and this ambiguous term has been interpreted by courts to also cover some business companies: for instance Dopravní podnik hl. m. Prahy (Prague public transport company) or Brněnské komunikace (Brno road network company).
In June, the Constitutional Court ruled on a constitutional complaint by ČEZ, a Czech electricity company, on whom the SAC had imposed a duty to disclose to an applicant a part of its documentation on the operation of the Temelín nuclear power plant. The SAC repeatedly held ČEZ to be a liable entity, in particular with respect to ČEZ being controlled by the state (the state’s share of voting rights being approximately 70%). Also, by operating the electricity grid, ČEZ was carrying out an activity in the public interest.
The Constitutional Court, however, did not share the SAC’s opinion. According to the Constitutional Court, although ČEZ meets some characteristics of a public institution, it is fundamentally a private law entity, a typical business company. Considering the gross interference in the entity’s rights that its inclusion under liable entities under the Act entails, it must be carefully assessed whether its public or private nature prevails. The extent of the state’s equity participation is the sticking point here: in the most controversial part of its judgement, the Constitutional Court held that an entity could only be viewed as a liable entity if the state or other liable entities are its sole shareholders. The provision of information is a heavy burden and creates a disadvantage in economic competition. A business corporation can only be burdened by such an obligation if its economic consequences are borne solely by the state (municipality, other public institution). If this is not the case, private entities (i.e. the shareholders) end up carrying the burden, which the Constitutional Court considers inacceptable.
A pessimistic conclusion drawn by a considerable portion of the media is that should any public entity wish to conceal what is happening in their corporations, they only have to transfer a single share to a friendly individual to avoid the status of a liable entity. At first sight, the Constitutional Court judgement may indeed seem to indicate this. We can but hope that the courts will view such a practice as a misuse of a right and will not take such ‘transfers’ into consideration when assessing the right to information.