Goal of the case: to cancel unlawful limitation of access to conditions of agreements on hydrocarbons sharing
Parties: plaintiff – international charitable organization Environment-People-Law, defendant – the Cabinet of Ministers of Ukraine
Essence of the issue: In January 2013, the Cabinet of Ministers of Ukraine signed a product sharing agreement with the company “Shell Exploration and Production Ukraine Investment (IV) BV”. According to the agreement, the investor gains an exclusive right to exploration and extraction of natural gas and other hydrocarbons on a area of 8 thousand square kilometers for the period of 50 years.
Conditions of such an agreement were developed and agreed exclusively with its parties and were not consulted with the public who according to the Constitutional norm are owners of minerals.
Moreover, although the agreement says nothing about methods of extraction, for over two years the company has been holding an information campaign about safety of shale gas extraction from hard shale rock using the method of hydraulic fracturing (known as fracking). Plans to apply such a technology raised a wave of concern among environmentalists and communities who expressed their desire to analyze conditions of transfer or actually sale of Yusivska field by the state to the investor. Special concern is caused by information about exclusion of the field from the sphere of coverage of the national environmental legislation and participation in the profit sharing of a private enterprise founded by relatives of the highest official in the country.
Efforts of environmentalists to influence the situation met serious opposition on behalf of public authorities who agreed with the investor to include to the agreement a provision about its confidentiality and then classified the agreement as the document “For official use only”.
Main facts, national level:
In June 2013, Environment-People-Law addressed the Administrative Court with a suit against the Cabinet of Ministers of Ukraine challenging unlawful limitation of access to the text of the agreement on hydrocarbons sharing and demanding to oblige it to release the agreement. EPL’s arguments are based on the Constitution of Ukraine and the Law of Ukraine “On Access to Public Information”, which definitely envisage openness of such a document, in particular p. 7 art. 6 says that:
“There shall be no limitation of access to information about use of state’s property (in this case minerals), including copies of certain documents, and about conditions of getting this property. Limitation of access to such information can exist exclusively in cases when release of such information can cause harm to interests of national safety, defense, investigation or prevention of a crime”.
Moreover, p. 2 art. 6 of the Law envisages that besides harm to above mentioned interests, an obligatory condition of lawful limitation of access is substantiality of such harm as well as prevailing of such harm from release of such information over social interest in getting it.
In July 2013 the Administrative Court refused to meet EPL’s claims. Ignoring the character of challenged legal relationship – relationship in the sphere of access to information – the court stipulated its decision exclusively by provisions of the law of Ukraine “On Product Sharing Agreement” and Guide on developing, agreeing and signing a product sharing agreement concluding that the Cabinet of Ministers of Ukraine or other public authority body has no obligation to release the text or information about conditions of the Product Sharing Agreement.
The court merely ignored provisions of the Law of Ukraine “On Access to Public information”. In its decision the court cites provisions of the Law of Ukraine “On Access to Public Information” about the regime of confidentiality of information but did not apply a triple test envisaged by art. 6 of the Law, which is a mandatory precondition of any limitation of access including classification of information as confidential. We believe such a selective application of provisions of the mentioned law is erroneous.
Moreover, the court gave no legal opinion about EPL’s proofs of unlawfulness of application of legal provisions on confidentiality by both the Cabinet of Ministers of Ukraine and the company, absence of any protected interests as basis of legal limitation of access, absence of substantial harm to legitimate interest by release of information as well as about substantial public interest in release of conditions of the agreement about Yuzivska field.
Although the plaintiff asked the court to give legal assessment to failure of the defendant to release draft agreement on hydrocarbon sharing approved by the Cabinet of Ministers of Ukraine, the court fully ignored the provisions indicated by the plaintiff about openness of work of the Cabinet of Ministers of Ukraine, the duty to release acts issued by this body, possibility to limit access to information exclusively for reasons of ensuring national safety and defense (p. 4 art. 3 of the Law of Ukraine “On the Cabinet of Ministers of Ukraine”).
All these arguments were included in the appeal suit from EPL, but in October 2013 the appellate court supported partied to the Agreement and did not uplift the limitation status from conditions of the agreement for sharing hydrocarbons, which will be extracted in Donetsk and Kharkiv regions for the next 50 years.
Limitation of access to the text of the agreement violates national legislation as well as international obligations of Ukraine, in particular obligations within the Aarhus Convention. Within the Aarhus regime there is a special body authorized to review violations by parties to the Convention of their obligations. Having lost in the appellate court, EPL exhausted national remedies of legal protection and at present is preparing an appeal to the Compliance Committee of the Aarhus Convention in Geneva where international community will consider the issues of lawfulness of classifying the agreement.