Commentary on Sections Part 1:  Auditors, Accounts, Directors' Liabilities and Investigations Changes made by the Act Section 22 - Protection in relation to certain disclosures
135.Statutory powers are not generally used by the DTI for enquiries carried out when vetting complaints about companies.  The vetting process is non-statutory and its purpose is to establish whether a formal investigation (usually under section 447) is appropriate.  The process therefore precedes the appointment of investigators with formal powers.  A requirement to produce documents or provide information imposed by an investigator using such formal powers overrides any duty of confidence which might in other circumstances prevent the person in question from handing over the document or revealing the information.  In the vetting situation, however, there are no statutory provisions guaranteeing immunity from legal liability to a person who, in breach of a contractual or other duty of confidence, provides information in response to an informal DTI enquiry.
136.This is not necessarily to say that a person would not have a defence to a breach of confidence claim in such circumstances.  However, the aim of this section is to remove the potential deterrent of having to argue such a defence so that individuals and businesses feel able to volunteer information in response to an informal DTI enquiry.  This should give the DTI wider access to the sort of information which can help decisions to be made about whether or not to start formal investigations.
137.The section inserts a new section 448A into the Companies Act 1985.
138.New section 448A(1) provides immunity from legal liability for breach of confidence to any person who makes a “relevant disclosure”.
139.New section 448A(2) defines “relevant disclosure” for this purpose.  A relevant disclosure is one which satisfies all of the five specified conditions in subsection (2).  These are:
	that it is a disclosure which is not made in compliance with a requirement imposed under Part 14 of the Companies Act 1985. This makes it clear that the new statutory immunity relates to information which is volunteered, rather than information which is provided in response to the exercise of an investigation power under that Part;
	that the disclosure is of a kind which could be required by the exercise of a power under Part 14 of the 1985 Act – in other words that it is relevant to a matter which could be investigated under that Part and is not covered by the provisions of section 452 (as amended) relating to legal professional privilege;
	that the person making the disclosure does so in good faith and believes, on reasonable grounds, that the information he or she is disclosing is capable of helping the Secretary of State for the purposes of the exercise of her functions under Part 14. The "good faith" requirement will make sure that, for example, disclosures motivated by a desire to cause harm to a business competitor will not be protected;
	that the information disclosed is not more than is reasonably necessary for the purpose of assisting the Secretary of State in the exercise of her functions under Part 14. This will ensure that only disclosures which are proportionate will be protected;
	that it is not a disclosure of a kind described in subsection (3) or (4). The effect of this last condition is that there is no statutory immunity from liability for breach of confidence where:
(i) the disclosure is in breach of a statutory duty of confidence (for example, under the Data Protection Act 1998) (subsection (3));
140.Thus, for example, new section 448A will not make it easier for the DTI, when vetting complaints, to obtain information about companies’ private banking transactions from their banks, because banks will still be exposed to the risk of having to defend breach of confidence claims if they reveal such information in those circumstances.
141.The effect of new section 448A(5) is that reference to statutory duties of confidence includes duties contained in secondary legislation, in Acts of the Scottish Parliament and legislation made under such Acts and in legislation passed or made after new section 448A comes into force.