Members of 4 New Square Chambers have recently succeeded in applications brought in three substantial cases in which defendants have sought to withhold the production of documents by reason of alleged foreign legal restrictions, with the three judgments being delivered within the space of months.
The cases are (1) LLC Eurochem North-West-2 and another -v- Société Générale S.A. and others [2025] 6 WLUK 298 (Bright J) (“Eurochem”), (2) Persons Identified in Schedule 1 v Standard Chartered PLC [2025] EWHC 2136 (Ch) (Michael Green J) (“Standard Chartered”) and (3) Aabar Holdings SÀRL & Ors v Glencore Plc & Ors [2025] EWHC 2243 (KB) (Bryan J) (“Glencore”).
These applications were concerned with parties seeking to withhold relevant documents that fell to be disclosed and inspected in the respective High Court proceedings due to the alleged risk of criminal prosecution in a foreign jurisdiction if the documents were produced.
In each case, the High Court applied the three-stage approach propounded in Bank Mellat v HM Treasury [2019] EWCA Civ 449 in considering: (1) whether compliance with an English disclosure order would (or might) entail a breach of foreign criminal law; (2) if so, whether there was a real or actual risk of prosecution in the foreign state, and (3) if so, whether, on balance, the risk of prosecution outweighs the importance of the documents to the fair disposal of the English proceedings.
Despite the disparate facts of each case, and the reliance in each on expert evidence asserting the real risk of prosecution abroad, the Court resolved each case in a similar way, finding no real risk of prosecution and so not varying the applicants’ disclosure obligations.
Eurochem concerned the non-payment of six on-demand bonds by European banks due to the operation of EU sanctions regimes. Bright J ruled on the application brought by C1 and C2 to order production of a document that the third party to the proceedings (TP) had withheld on the basis that production would be prohibited under Italian secrecy laws. Bright J found that there was no breach of Italian law and no real risk of prosecution. He further held that:
- Following Henshaw J in Public Institution for Social Security v Al Rajaan [2023] EWHC 1065 (Comm) (at paragraph 44): “It is for the disclosing party to show that the foreign law is regularly enforced so that the threat to that party is real.”
- If the provisions of the relevant secrecy laws were regularly enforced, one would expect examples where a party had been prosecuted for their breach, but no examples had been cited (paragraphs 16, 17).
- In any event, the withheld document went to a central issue in proceedings and ought to be considered for the trial to reach a fair and reliable result (paragraph 4).
- The attempt by TP to persuade the Court that the document was of only limited relevance to the case was tantamount to an invitation to the court to speculate on the document’s contents, which the Court was not willing to do (paragraph 5).
In Standard Chartered, a group of investors in the Defendant brought claims pursuant to sections 90 and 90A and Schedule 10A of the Financial Services and Markets Act 2000. An application was brought by D to vary the Court’s disclosure orders to permit D to withhold categories of documents from inspection due to duties of confidence owed to regulators in the USA and Singapore. Michael Green J rejected this approach on the basis that (among other things) D had not established any real risk of criminal prosecution or civil enforcement.
In his judgment, Michael Green J articulated the following principles:
- Although lack of past prosecutions may not be determinative of whether there is a real risk of prosecution (Nox Emissions litigation, Joshua & Ors v Renault SA & Ors [2024] EWHC 1424 (KB)), in this case there was no evidence of a change of policy that may make prosecutions now more likely than they were previously (paragraph 26).
- Even where a risk of prosecution is established, it shall nevertheless be difficult to persuade the Court to dispense with disclosure (paragraphs 32, 34).
- It would be even more difficult to persuade the Court to allow relevant documents to be withheld on the basis of lesser considerations, including the risk to the disclosing party of civil or regulatory enforcement, or principles of comity arising from confidentiality obligations to foreign regulators (paragraphs 35, 41).
In Glencore, being another shareholder class action under sections 90 and 90A of the Financial Services and Markets Act 2000 brought by investors in Glencore Plc against Glencore Plc and others, Bryan J dismissed two applications by which D1 and D2 sought to withhold disclosure of certain documents obtained from Dutch investigators.
Bryan J found, after consideration of detailed expert evidence as to Dutch law and practice, that the applications both failed at stage 1 of the Bank Mellat three-stage approach, and in any event would also have failed at stages 2 and 3 (no real risk of prosecution and the ‘balancing exercise’ easily being resolved in favour of disclosure).
In Eurochem, Standard Chartered and Glencore, the Court ordered that the relevant documents be disclosed into a confidentiality club (which was the approach proposed by the parties resisting the withholding of disclosure before the applications were heard). The fact that the documents would be disclosed into a confidentiality club was stated to be a relevant factor for the Court when determining that there was no real risk of prosecution in Standard Chartered and Glencore.
These three cases reveal a consistent approach by the High Court and demonstrate the high threshold that must be crossed, and the cogency of evidence that is required, to be relieved of one’s disclosure obligations in English High Court litigation by reason of alleged foreign law restrictions.
Tim Chelmick and Helena Spector appeared in Eurochem.
Shail Patel KC and William Harman appeared in Standard Chartered.
Usman Roohani appeared in Glencore, led by Andrew Onslow KC (3 Verulam Buildings) and Richard Mott (One Essex Court).
