REFERENCE: [CEI/10/05]

EUROPEAN COMMUNITIES
(ACCESS TO INFORMATION ON THE ENVIRONMENT) REGULATIONS 2007

BEFORE

THE COMMISSIONER FOR ENVIRONMENTAL INFORMATION

BETWEEN

APPLICANT
GAVIN SHERIDAN

and
PUBLIC AUTHORITY

THE NATIONAL ASSET MANAGEMENT AGENCY

SUBMISSION OF THE APPLICANT IN RELATION TO THE INVESTIGATOR’S

PRELIMINARY REPORT

Introduction

1. This submission arises in connection with an appeal to the Commissioner for

Environmental Information of a decision by the National Asset Management Agency
(“NAMA”) to reject a request by the applicant for access to information on the
environment held by or on behalf of NAMA.

NAMA rejected the request on the basis that it was not a public authority.

2. The applicant makes this submission in response to the investigator’s preliminary

report. It is the applicant’s position that the investigator has erred both in law and in
fact by:

2.1 Failing to find that NAMA is a public authority by reason of Regulation

3(1)(vi) of SI 133/2007;

2.2 Failing to apply the correct test when considering whether or not NAMA’s
functions are administrative in nature;

2.3 Failing to find that NAMA is a public authority by reason of Regulation

3(1)(b) of SI133/2007;

2.4 Failing to find that NAMA is a public authority by reason of Regulation

3(1)(c) of SI133/2007; and

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 2.5 Incorrectly finding that NAMA’s powers serve no public purpose and that it
is a purely commercial entity.

Procedure

3. On February 3, 2010, the applicant emailed a request (attached at Appendix 1) to

NAMA under Environmental Information Regulations (“the Regulations”) (SI
133/2007) seeking:

1) A breakdown of all assets, loans and properties due to be transferred to

the Agency. This should include the value placed on the asset and by whom.
It should include the addresses of all assets and properties.

2) A breakdown of all properties and property loans currently owned or

controlled by the Agency.

3) Minutes of board meetings relating to the transfer of assets and properties

to the Agency. The date range for this request is January 2009 to January
2010, inclusive.

4. On February 16, 2010, NAMA replied, stating that it did not consider itself to be a
public authority for the purposes of the Regulations. On the same day, the applicant
appealed that decision for internal review. The applicant stated:

You state that you do not consider NAMA to be a "public authority" within the
AIE regulations. However under the Regulations a public body is defined as:

a) government or other public administration, including public advisory

bodies, at national, regional or local level,
(b) any natural or legal person performing public administrative functions
under national law, including specific duties, activities or services in relation to
the environment, and
(c) any natural or legal person having public responsibilities or functions,
or providing public services, relating to the environment under the
control of a body or person falling within paragraph (a) or (b),

and includes:

(vi) a board or other body (but not including a company under the Com-
panies Acts) established by or under statute,
(vii) a company under the Companies Acts, in which all the shares are
held—
(I) by or on behalf of a Minister of the Government,
(II) by directors appointed by a Minister of the Government,
(III) by a board or other body within the meaning of paragraph (vi), or
(IV) by a company to which subparagraph (I) or (II) applies, having
public administrative functions and responsibilities, and possessing
environmental information;

The NAMA board consists of 9 members, appointed by the Minister for

Finance. The chief executives of NAMA and the NTMA (ex-officio) are

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 appointed by the Minister. This alone would clearly indicate that NAMA is a
public body. (vi) would appear to be particularly relevant.

5. On March 19, 2010, NAMA replied stating that after an internal review it still
considered itself not to be a public authority of the purposes of the Regulations. The
applicant then appealed to the Office of the Commissioner for Environmental
Information (“OCEI”). Copies of the relevant correspondence are attached at
Appendix 1.

The OCEI investigator issued a preliminary report on June 30, 2010. A copy of her
preliminary report is attached at Appendix 2.

Relevant legislation and Guidance

6. Directive 2003/4/EC (the “Directive”) provides the public with a right of access to
environmental information held by or on behalf of a public authority. The Directive
was transposed into Irish law by way of the European Communities (Access to
Information on the Environment) Regulations 2007 (S.I. No. 133 of 2007).

Article 2(2) of the Directive defines “public authority” as follows:

2. ‘Public authority’ shall mean:

(a) government or other public administration, including public advisory

bodies, at national, regional or local level;

(b) any natural or legal person performing public administrative functions

under national law, including specific duties, activities or services in relation to
the environment; and

(c) any natural or legal person having public responsibilities or functions, or

providing public services, relating to the environment under the control of a
body or person falling within (a) or (b).

Member States may provide that this definition shall not include bodies or
institutions when acting in a judicial or legislative capacity. If their
constitutional provisions at the date of adoption of this Directive make no
provision for a review procedure within the meaning of Article 6, Member
States may exclude those bodies or institutions from that definition.

7. Article 3 of the Regulations mirrors the definition of “public authority” found in the
Directive but also elaborates on that definition by providing an unqualified and non-
exhaustive list of bodies and categories of bodies which are to be considered as
public authorities for the purpose of the Regulations:

“public authority” means, subject to sub-article (2)—

(a) government or other public administration, including public
advisory bodies, at national, regional or local level,
(b) any natural or legal person performing public administrative
functions under national law, including specific duties, activities or
services in relation to the environment, and

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 (c) any natural or legal person having public responsibilities or
functions,
or providing public services, relating to the environment under the
control of a body or person falling within paragraph (a) or (b),
and includes—
(i) a Minister of the Government,
(ii) the Commissioners of Public Works in Ireland,
(iii) a local authority for the purposes of the Local Government Act
2001(No. 37 of 2001),
(iv) a harbour authority within the meaning of the Harbours Act 1946
(No. 9 of 1946),
(v) the Health Service Executive established under the Health Act
2004
(No. 42 of 2004),
(vi) a board or other body (but not including a company under the
Companies Acts) established by or under statute,
(vii) a company under the Companies Acts, in which all the shares are
held—
(I) by or on behalf of a Minister of the Government,
(II) by directors appointed by a Minister of the Government,
(III) by a board or other body within the meaning of paragraph
(IV) by a company to which subparagraph (I) or (II) applies,
having public administrative functions and responsibilities, and
possessing environmental information;

8. Pursuant to Article 14 of the Regulations, the Minister for the Environment,

Heritage and Local Government has provided Guidance Notes which public
authorities are obliged to take account of when performing their functions under the
Regulations. In relation to the definition of “public authority” the Guidance Notes1
state:

Definition of “public authority”

As indicated at paragraph 3.2 above, “public authority” is broadly defined to
comprehend all such bodies that have public administrative functions and that
hold environmental information. The definition makes it clear that certain
public bodies - such as Government Departments and local authorities - fall
within the scope of the definition. The definition also makes it clear that
bodies established by statute and certain companies established under
the Companies Acts are comprehended by the definition. Broadly, it is
intended to cover bodies that are subsidiary public bodies and would include
noncommercial and commercial semi-state bodies that perform public
administrative functions and that hold environmental information.

Clearly the definition is broad and is designed to include a large group of State and
semi-State bodies. Bodies that fall within the scope of the Regulations include the
commercially motivated State-owned company Coillte, established under the
Forestry Act.

About NAMA
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"!

http://www.environ.ie/en/AboutUs/AccesstoInformationontheEnvironment/RHL
egislation/FileDownLoad,2481,en.pdf!

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9. NAMA was established pursuant to the National Asset Management Agency Act
2009 (the “Act”) in response to a serious threat to the Irish economy and with the
purpose inter alia of stabilising the financial system, to facilitate the availability of
credit in the economy, to facilitate the restructuring of credit institutions of systemic
importance to the economy and to remove uncertainty in relation to the valuation of
certain assets in those institutions.

10. NAMA is established as a separate corporate body with a board appointed by the
Minister for Finance under the control of the NTMA. NAMA as a corporate entity will
arrange and supervise the identification of property-backed loans on the books of the
qualifying financial institutions in the State but will delegate under its control the
purchase and management of those loans to a separately created special purpose
vehicle (the “SPV”)2. 95% of the consideration for the purchase of the loans will be
financed by securities guaranteed by the government and the remainder with non-
State guaranteed debt.

11. The SPV will be a separate legal entity with a subscribed capital of !100 million
with private investors owning 51% of the equity and the remainder owned by NAMA.
Given that the SPV is 95% funded by the State however, NAMA representatives on
the board of the SPV have a veto over all decisions of the SPV board that could
affect NAMA or the Government.

12. The SPV will seek to make a profit through the management of the acquired
assets during the lifetime of NAMA, however given that the SPV debt will be
guaranteed by the Government the distribution of the SPV profits to the private
shareholders will be capped and the remainder will accrue to the State.3 The details
of the distribution of the SPV profits are not publicly available.

Selection of qualifying institutions and assets

13. Unlike a commercial asset management firm, NAMA is not free to choose the
assets that it purchases. Qualifying financial institutions will be designated by the
Minister for Finance after consultation with the Governor of the Central Bank and the
Financial Regulator. Financial institutions will only qualify if the Minister considers
them to be systemically important and that the purchase of the assets is necessary to
achieve the purposes of the Act.

State Aid

14. The European Commission has determined that NAMA constitutes State Aid
pursuant to Article 107 of the Treaty on the Functioning of the European Union
(TFEU)4 but that it is compatible with the internal market on the basis of Article
107(3)(b) TFEU in order to remedy a serious disturbance in the Irish economy.

15. The Commission considers that NAMA constitutes State aid for the following
reasons:

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2
EU State Aid decision paragraph 32
3
EU State Aid decision paragraph 38!
%!Case N725/2009!

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 • It is highly unlikely that a market based investor would purchase the
eligible assets on such a scale and on similar terms. In other words
the measure is clearly financed by the State;
• Assets are purchased at above market prices; and
• Asset purchases are exempt from stamp duty.

Reporting, Accountability and Review

16. NAMA is subject to extensive supervision by the State. Under the Act it is obliged
to submit an annual statement to the Minister in a format that the Minister directs and
the Minister must lay that statement before the houses of the Oireachtas. Similarly
Quarterly reports must be submitted to the Minister. Indeed the Minister may direct
NAMA to report to him in any way he sees fit. Additionally NAMA is obliged to submit
its annual accounts to the Comptroller and Auditor General (“CAG”) for audit. The
Chairperson and chief executive of NAMA are also obliged to appear before the
Public Accounts Committee and any other Dáil committee if so directed.

17. The operation of NAMA shall be reviewed every three years by the CAG and
every five years by the Minister. The Minister in his review shall decide whether or
not NAMA should continue to exist having regard to the purposes of the Act.

Powers

18. NAMA has been given many powers in order to carry out its functions and to fulfill
its obligations in relation to achieving the purposes of the Act. Many of these powers
are normal powers necessary for asset management. However the Oireachtas
decided that NAMA would be unable to achieve its goals through the exercise of
normal commercial powers and therefore vested extraordinary powers in NAMA that
go beyond those available to a normal commercial entity trading in the property
market. These extra powers are an explicit acknowledgement that NAMA is not
operating on a normal commercial basis.

19. The European Commission in its State Aid decision considered these powers
and stated:

(44) Some of the powers granted to NAMA are not available or go beyond
those available to traditional market players operating on the real estate
financing market in Ireland. According to the Irish authorities, such powers
are essential for the discharge by NAMA of the obligations imposed on it by
its statute. They are essential for NAMA's fundamental purpose of acquiring
assets in order to address a serious threat to the economy and to the
systemic stability of credit institutions in the State.

In other words this is an explicit acknowledgement by the Irish government that

NAMA could not achieve its goals through the exercise of normal commercial
powers.

20. NAMA has the power to compulsorily acquire land if it considers it necessary to
do so. This power is directly analogous to that of local authorities found in Part XIV of
the Planning and Development Act 2000. In the case of local authorities, this power
is supervised by An Bord Pleanála whereas in the case of NAMA, the High Court
carries out this role. The supervisory role of the High Court is limited since it is

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obliged to grant a compulsory purchase order in the case where there is no objection
and only where there is an objection is the Court obliged to consider the proposed
purchase. In such a case, the Court’s role is merely to ensure that the decision to
acquire land by CPO is reasonable. In either case the power is exercised by NAMA
under supervision of the Court in exactly the same way that a local authority
exercises powers of CPO under supervision of An Bord Pleanála. In the applicant’s
view it would be exceptional if a commercial asset management agency or property
developer had such a power that is normally reserved to public authorities.

21. NAMA has been given special powers to extend the life of planning permission.
Under Section 42 of the Planning and Development Act 2000 (as amended by the
Act) NAMA may apply to a planning authority to extend the period of a planning
permission. Exceptionally in the case of applications by NAMA, the planning authority
may extend the period where development has yet to commence and on the basis of
economic and commercial considerations. This exception to planning law is only
available to NAMA and is not be available to commercial developers.

22. Paragraph 127 of the EU State Aid decision summarises NAMA’s exceptional
powers that the Commission considers could distort competition. The Commission
highlights that these powers are not available to commercial market participants:

(127) The Commission notes however that a number of powers, rights and
exemptions are granted to NAMA for the management of the assets post
acquisition with a view to help the agency achieve the maximum recovery
value for the assets. Such powers, in particular when they are specific to
NAMA and not available to market operators are potential sources of
competition distortions. In its assessment, the Commission has in particular
focused on those specific powers which it considers to be potentially more
distortive.

23. Arising from the European Commissions State Aid decision, NAMA has agreed to
limit the exercise of some of those powers. However the Commission remains
concerned that NAMA’s powers are still capable of distorting competition and have
obliged Ireland to report on an annual basis in relation to the use of NAMA’s powers.
Despite the limitations agreed with the Commission, NAMA maintains exceptional
powers in relation to its activities - powers which no commercial participant in the
Irish property market would have.

24. The investigator points out that NAMA’s powers are discretionary. Of course
many powers of public authorities are also discretionary. For example a local
authority’s power of CPO is also discretionary. Therefore the discretionary nature of
NAMA’s powers have no relevance to NAMA’s status as a public authority.

25. Whether or not NAMA’s extraordinary powers are discretionary, are limited or
that NAMA is not under a duty to exercise them is irrelevant. The legislature decided
that NAMA required these powers to perform its functions and achieve the purpose
of the Act and so vested NAMA with these powers, powers that are more typical of a
public authority than a market participant.

Exemptions

26. Income accruing to NAMA is exempt from income tax, corporation tax and capital
gains tax. In addition stamp duty does not arise on the purchase of assets from

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qualifying institutions.

27. Under Section 216 of the Act, except in limited circumstances NAMA is not
considered to be providing a service or carrying out activities that would require it to
be regulated by the Central Bank.

28. Under Section 215 (1) of the Act, NAMA is exempt from the application of Parts 2
and 3 of the Competition Act 2002, which relate to anti-competitive behaviour and the
regulation of mergers and acquisitions respectively.

Summary

29. NAMA was established to achieve the public policy goal of reacting to the serious
threats to the Irish economy brought about by the deterioration of the balance sheets
of systemically important financial institutions through the purchase at above market
value of eligible assets in order to restore the balance sheets of these institutions.
While NAMA is mandated to achieve the maximum return possible for the State, it
was not established to make money or to be an asset management agency
competing in the market.

30. NAMA has been vested with extraordinary powers that no commercial entity
would have. In addition it is exempt from tax, Central Bank regulation and from most
aspects of Irish competition law. The European Commission considers that NAMA
has exceptional powers that market participants do not enjoy and it is concerned that
the exercise of such powers may distort competition in the internal market.

Summary of Investigators preliminary report

31. In her preliminary report, the investigator frames the issue as follows:

Therefore, as the appellant appears to concede, at least implicitly, in his

submission, the question of NAMA’s status the [sic] AIE Regulations turns on
whether it performs what are considered to be “public administrative
functions” within the meaning of Article 3(1)(b) of the Regulations.

The applicant strongly rejects this assertion. The applicant does not make this
concession, either explicitly or implicitly. It is clear from the applicant’s submissions
to date that he is asserting that NAMA is subject to the regulations because it is “a
board or other body (but not including a company under the Companies Acts)
established by or under statute.” In other words NAMA falls squarely and
unambiguously within Article 3(1)(vi) of the Regulations. The investigator fails to give
reasons why 3(1)(vi) should not apply.

32. The investigator then goes on to analyse NAMA’s functions in the context of
various UK decisions in relation to the UK transposition of the Directive. She seeks to
draw analogies from competition law, human rights law and employment law.

33. The investigator concludes that asset management is a commercial activity and
that the purpose and function of NAMA is to maximise profits, an activity that is not
normally considered to be a governmental function. The investigator also concludes
that since NAMA does not regulate a particular area and in light of its commercial
mandate it is not a public authority within the meaning of Article 3(1)(b) of the
Regulations.

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Definition of public authority

34. The applicant submits that NAMA is a public authority solely by reason of Article
3(1)(vi) of the Regulations. However without prejudice to that assertion he also
submits that NAMA is a public authority within the meaning of Article 3(1)(b) of the
regulations because it is a public body that carries out administrative functions.

NAMA is a public authority because of Article 3(1)(vi)

35. As already submitted, NAMA falls unambiguously within the meaning of Article
3(1)(vi). Given that the legislature saw fit to provide a non-exhaustive list of types of
entity to which the Regulations apply, the Commissioner must find that NAMA is a
public authority and it should not be necessary to carry out an analysis of the
functions of NAMA under Article 3(1)(b).

NAMA is a public authority because of Article 3(1)(b)

36. Without prejudice to the above the applicant also submits that NAMA is a public
authority within the meaning of Article 3(1)(b) of the regulations.

The framework for an analysis of whether or not a body carries out public
administrative functions was described in the decision of the UK Information
Commissioner in decision FER0265609 (PhonepayPlus). It is essentially a two-step
process [para 30]:

1. Does the body exercise functions that are public in nature?

2. Are these functions administrative?

The answer to both question depends on the facts of each case with no single factor
being decisive.

37. The applicant agrees with the investigator’s view that there is no dispute in
relation to whether or not NAMA is a public body at all, therefore the focus of the
analysis rests on whether or not the functions of NAMA are administrative in nature.

38. The UK Commissioner in the PhonepayPlus decision characterised

administrative functions as follows:

Administration can be visualised as the managing of power within the state

apparatus and the achievement of a non legal goal through reliance on
specific legal powers.

Clearly NAMA is engaged in managing power within the State apparatus to achieve
the goal of restoring confidence in the banking sector, removing uncertainty in
relation to asset valuations, restoring the flow of credit and protecting the interests of
tax payers. These are social goals taken in the public interest directed at the future
and designed to regulate certain assets of a limited number of institutions.

39. The UK Information Tribunal provided further guidance in its decision in Port of
London Authority v Information Commissioner (EA/2006/0083) (‘Port of London’).

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The Tribunal considered the following factors:

1. The Authority has statutory duties. If the Authority did not fulfil those duties
Government would need to task another organisation with them.
2. The Authority has to account to Parliament as well as to its shareholders.
3. The appointment of the Board is heavily influenced by the Secretary of
State.
4. The Authority must report annually to Parliament on all its functions so
there is nothing to suggest that some of them are regarded as private and the
authority must give the Minister such information as he requires in relation to
the exercise of any of their powers.
5. Some Ministerial approval for borrowing is required.
6. Appeal of licensing decisions is to the Board of Trade.
7. The Authority can act akin to a local or governmental authority.
8. The Authority can regulate others in a way that is over and above the way
private companies can.

The Commissioner in PhonepayPlus recites these factors but notes [para 50]:

The determination about whether a public authority carries out administrative

functions will always be dependant on the facts of what that authority does.
Therefore the numbered factors in Port of London above should not be
regarded as mandatory but merely as examples of the kind of factors that
make a function administrative.

40. Almost all of the above factors apply to NAMA:

40.1 NAMA has statutory duties and as the European Commission pointed
out it would be unlikely for a commercial entity to purchase the eligible assets
on the same terms as NAMA. In other words if NAMA did not exist, the State
would need to task another government body with its tasks.

40.2 NAMA has a high degree of accountability to the executive and to

parliament including to the CAG and PAC.

40.3 All appointments to the board, including ex-officio members are by the
Minister for Finance.

40.4 NAMA must give regular reports on all its functions to the Minister for
Finance who lays those reports before the houses of the Oireachtas.

40.5 95% of NAMA’s funding is guaranteed by the State, in addition the

amount of borrowing is capped by statute and can only be changed by the
legislature.

40.6 Appeal of NAMA’s decisions is by way of judicial review, a remedy in

public law. [Section 193/194 of the Act].

40.7 NAMA has CPO powers, powers to enter land, develop, alter, improve or
manage lands which are akin and analagous to public authority powers,
similarly NAMA is exempt from income tax, corporation tax and capital gains
tax in the same way that a public authority would be.

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 40.8 NAMA can regulate others in a way that is over and above the way
private companies can. For example NAMA may purchase loans against the
borrower’s will.

41. Accordingly NAMA fulfills all the criteria articulated in Port of London. In the case
of PhonepayPlus, the Commissioner found that only factors 1 and 8 were decisive
whereas all eight are relevant in the case of NAMA. Unlike PhonepayPlus, NAMA
has not been tasked with regulating a particular area, however this is not decisive
since all the relevant factors must be assessed.

Commercial Aspects of NAMA

42. The investigator provides a detailed analysis of the contrast between bodies
engaged in economic activity and those exercising purely sovereign or administrative
powers. Competition law applies to the former while it does not apply to the latter.
The investigator cites the recent High Court decision of McKechnie J in Nurendale
Limited t/a Panda Waste Services v Dublin City Council & Ors. [2009] IEHC 588.

43. Firstly it should be pointed out that the legislature has specifically exempted
NAMA from Parts 2 and 3 of the Competition Act 2002, placing it firmly in the
category of bodies that exercise sovereign or administrative power and indicating
that NAMA is not engaged in an economic activity.

44. Secondly in the Nurendale case the four Dublin local authorities were found to be
undertakings (i.e. engaged in economic activity) and that their exercise of regulatory
power (i.e. the making of a variation to the statutory waste management plan) was
unlawful. Local authorities are clearly subject to the Regulations, yet the High Court
found that they were engaged in commercial activity through the exercise of
regulatory powers.

45. On the other hand, the Competition Authority found that the HSE was not an
undertaking when it purchased drugs for supply to the Community Drugs scheme
(Competition Authority Enforcement Decision ED/01/008). Again the HSE is subject
to the Regulations.

46. The investigator considers that since NAMA must apply for planning permission it
is like any other property developer:

“While its functions may ultimately entail the acquisition of property, like any
other property developer, it is required to apply for planning permission in
order to develop the land or minerals on land (section 12(2)(z) and (aa) of the
Act refers)”

47. That NAMA must seek planning permission is not relevant. All bodies, companies
or persons in the State, whether State-owned or not, must seek planning permission
to develop lands, or minerals on lands.

48. This follows the Supreme Court judgment handed down in Howard and Ors v.
Commissioner for Public Works in May 1993. The central argument raised by
applicants related to the question whether the OPW, as a State authority, was bound
by the Local Government (Planning and Development) Act 1963 to obtain planning
permission.

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49. The court agreed with the High Court judgment of Costello J. that State
authorities’ traditional powers of development had been curtailed and that they are,
like private and commercial parties, ordinary actors in the planning process and must
obtain planning permission.

50. This issue was also canvassed in Port of London where the Tribunal held:

The PLA argue that they are subject to government control in respect of
planning regulations and that this puts them in the same category as a private
organisation, further that their functions are consistent with their role as an
owner and operator of a commercial port. However, we note that the
functions of the PLA permit them to act in a way akin to a local authority or
governmental authority. Sec 11 permits the compulsory purchase of land in
connection with undertakings “as if the Port Authority were a local authority..”

51. That NAMA, like other actors, must obtain planning permission is not a factor in
this case. Furthermore its powers of compulsory purchase of land make NAMA more
akin to a local authority than a commercial operator.

52. The investigator relies heavily on NAMA’s commercial mandate and duty to make
profit. In doing so she draws analogy with the UK Information Tribunal Decision in
Network Rail Limited (EA/2006/0061 and EA/2006/0062). Network Rail Limited is
entirely different to NAMA. It was established as a regulated monopoly in the context
of deregulation of the rail market in Europe, it operates on a market basis and pays
tax on its profits. In the absence of Network Rail, another private entity could operate
its service. NAMA was established as part of a public asset relief scheme in the
context of governmental response to the global financial crisis. It operates in an area
that is overwhelmingly if not exclusively operated by the Member States of the
European Union. As we have pointed out no private entity would operate on the
same basis as NAMA and that NAMA is exempt from tax.

53. NAMA was established for public policy and not commercial reasons. It was
created as part of the Irish public asset relief scheme in order to address serious
threats to the financial system in the State. The method of achieving its public policy
goals is by way of asset management which can be a commercial activity. Given
NAMA’s powers and particular exemptions, however, NAMA does not operate on the
same basis as any commercial player in the property market in Ireland.

NAMA is a public authority because of Article 3(1)(c)

54. Without prejudice to the above stated view that NAMA is a public authority by
virtue of Article 3(1)(vi) and/or by virtue of Article 3(1)(b), the applicant also submits
that NAMA is a public authority within the meaning of Article 3(1)(c) of the
Regulations. Article 3(1)(c) states:

(c) any natural or legal person having public responsibilities or functions,

or providing public services, relating to the environment under the
control of a body or person falling within paragraph (a) or (b),

NAMA clearly falls under the control of a body or person falling within paragraph (a)
or (b). It is also has clear public responsibilities or functions relating to the
environment.

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55. According to the Memorandum of Association for one of the six companies
established by NAMA, National Asset Loan Management Limited (Company No
480246), the objectives for which the company was established include:

(9) To purchase, take on lease, on licence, in exchange, upon option or otherwise

acquire and hold any lands, buildings, property (whether leasehold or freehold)
or any rights or interests therein or in respect thereof and to develop, improve,
alter or manage the same or any part thereof in any way (including, without
limitation, construction, demolition, landscaping, planting, draining and
improving).

56. According to the Directive and to the Regulations as transposed, the company
and NAMA itself have public responsibilities or functions relating to the environment
under the control of a body or person falling within paragraph (a) or (b). The
connection to the environment is clear. The Directive and Regulations state that
environmental information means:

(a) the state of the elements of the environment, such as air and
atmosphere, water, soil, land, landscape and natural sites including
wetlands, coastal and marine areas, biological diversity and its
components, including genetically modified organisms and the interaction
among these elements,

(b) factors, such as substances, energy, noise, radiation or waste, including

radioactive waste, emissions, discharges and other releases into the
environment, affecting or likely to affect the elements of the
environment,

(c) measures (including administrative measures), such as policies,

legislation, plans, programmes, environmental agreements, and activities
affecting or likely to affect the elements and factors referred to in
paragraphs (a) and (b) as well as measures or activities designed to protect
those elements,

(d) reports on the implementation of environmental legislation,

(e) cost-benefit and other economic analyses and assumptions used within
the framework of the measures and activities referred to in paragraph (c), and

(f) the state of human health and safety, including the contamination of the
food chain, where relevant, conditions of human life, cultural sites and built
structures inasmuch as they are, or may be, affected by the state of the
elements of the environment referred to in paragraph (a) or, through those
elements, by any of the matters referred to in paragraphs (b) and (c);

57. The company, in relation to “lands, buildings and property”, plans to “develop,
improve, alter or manage the same or any part thereof in any way (including, without
limitation, construction, demolition, landscaping, planting, draining and improving)”.

58. According to (c), these are measures, including administrative measures, such as
policies, plan, programmes, environmental agreements and activities affecting or likely to
affect the elements and factors referred to in (a) – the state of the elements of the
environment.

59. Cost-benefit and other economic analyses and assumptions used within (c) would
also constitute environmental information, within the meaning of Article 3 (1) (c) meaning

! "$!
that the company and NAMA have public responsibilities or functions, or providing public
services, relating to the environment under the control of a body or person falling within
paragraph (a) or (b).

Conclusion

60. NAMA is clearly a public authority. It meets all the relevant factors which
distinguish it from a commercial entity offering goods and services in the market. It
carries out measures which are likely to alter the environment.

Environmental Information

55. The investigator has failed to deal with the issue of whether or not NAMA holds
environmental information. This issue has been partly dealt with in paragraphs 54-59.
The amount of control exerted by the State over its functions makes NAMA not just a
public authority for the purposes of the Regulations but also a public authority with
considerable information and also a public authority with plans likely to have a
considerable affect on the environment.

56. The applicant reserves his position in relation to what environmental information
NAMA holds, and what defines that information generally. However, the Regulations
are clear as to what can define environmental information. NAMA will own loans in
relation to land throughout the State, essentially becoming one of the largest owners
of land, or of loans or charges in relation to land, in the State. Land is an element of
the environment, and NAMA will be carrying out policies, legislation, plans,
programmes and activities likely to affect that land.

57. Economic analyses and risk reports are also covered by the Regulations. NAMA
carries out analyses and reports in relation policies, plans, legislation, programmes
and activities likely to affect land in the State. Therefore it holds environmental
information in relation to (e) of the definition of environmental information.

Conclusion

58. NAMA is a public authority for the purposes of the Regulations by virtue of Article
3(1)(a) of the SI133/2007 - (vi) a board or other body (but not including a company
under the Companies Acts) established by or under statute.

There is no need to reference further any other part of the legislation, Article 3(1)(a)
is wholly and entirely sufficient for NAMA to fall under the Regulations, as it is a body
established by or under statute.

59. Without prejudice to that view, NAMA is still a public authority under Article
3(1)(b) and/or Article (3)(1)(c) of the Regulations.

60. In conclusion, it is clear that NAMA is a public authority for the purposes of
SI133/2007.

! "%!
Appendix 1
National Asset Management Agency
Treasury Building
Grand Canal Street
Dublin 2

February 3, 2010

Request for access to environmental information under European

Communities (Access to Information on the Environment) Regulations
2007

Dear Sir/Madam,

In accordance with the above mentioned regulations, I wish to request

the following records which I believe to be held by the National Asset
Management Agency ("the Agency"):

1) A breakdown of all assets, loans and properties due to be

transferred to the Agency. This should include the value placed on the
asset and by whom. It should include the addresses of all assets and
properties.

2) A breakdown of all properties and property loans currently owned or

controlled by the Agency.

3) Minutes of board meetings relating to the transfer of assets and

properties to the Agency. The date range for this request is January
2009 to January 2010, inclusive.

I wish to obtain all information in electronic format via email.

Below are a number of paragraghs from the guidelines supplied to

public authorities on the AIE Regulations which I wish to highlight:

Definition of “environmental information”:

The definition of “environmental information” (as set out in Article
3(1)) is fundamental in that it determines what environmental
information comes within the remit of the AIE regulations. The
definition is deliberately wide in scope and comprehends an extensive
range of information. It makes it clear that information may be held
in any material form (including written, visual, aural or electronic),
and the definition includes not just the environmental information
produced or received by a public authority, but also comprehends such
information held on behalf of the authority.

In general, public authorities should:

- consistent with other provisions of these Regulations, maintain a
presumption in favour of the disclosure of environmental information,
and seek to respond positively and promptly to requests,
- offer assistance to members of the public to enable them to
formulate requests in accordance with Article 6 of the Regulations,
with particular regard to individuals who may have literacy or other
relevant difficulties or disabilities,

! "&!
- in the event that the environmental information sought is held by
another public authority, transfer the application to that body. In
this event, the applicant should be informed accordingly or be
supplied with details of where the information is held and to whom the
request should properly be made,
- identify the environmental information they hold and actively
disseminate it to the public, particularly by electronic means,
- update their available information regularly to ensure that it is
accurate and comparable and that it includes, at a minimum, the
information specified in Article 7.2 of the Directive,
- retain environmental information in a manner that is easily accessible,
- designate Information Officers and establish systems and structures
to register and process all requests within the relevant time limits,
- ensure that their staff are aware of the provisions of the AIE Regulations.

The fact that the release of information (for example, in relation to

a pollution incident) might damage the reputation of a company is not
of itself adequate reason for withholding it.

Article 9(2)(d):
Article 9(2)(d) provides that information included in the internal
communications of a public authority may be protected from release.
This could include internal minutes or other communications, between
officials or different public authorities, or between officials and
Ministers. Public authorities should bear in mind that the use of this
exception is discretionary. It should not be resorted to as a simple
expedient to protect all internal communications in circumstances
where it would be unreasonable to do so (see also sub-articles 10(3)
and 10(4)). Normally, public authorities would not be expected to
invoke this protection for information unless there are good and 25
substantial reasons – not otherwise available in Articles 8 and 9 –
for doing so.

Please contact me by email to discuss any problems which may occur

with this request.

Sincerely

Gavin Sheridan

--------------------------------------------------------------------------------------------------------

Dear Mr. Sheridan

I refer to your email to the National Asset Management Agency of 3

February 2010.

Upon due consideration of your request and the AIE Regulations, we do

not propose to accede to your request as we do not consider that the
National Asset Management Agency is a "public authority" within the
definition set out in the AIE Regulations.

Best regards,
David Proctor

---------------------------------------------------------------------------------------------------------

! "'!
March 19, 2010

Dear Mr Sheridan,

I refer to your email of the 16th of February 2010.

I have conferred on this issue with the Head of Legal and Tax within the National
Asset Management Agency. Under her advice our response to this issue still remains
the same. I trust this answers your query.

Best regards,
David Proctor
--------------------------------------------------------------------------------------------------------

March 19, 2010

Dear Mr Proctor,

I wish to appeal your decision for internal review to a more senior member of staff, as
is my right under the Directive.

You state that you do not consider NAMA to be a "public authority" within the AIE
regulations. However under the Regulations a public body is defined as:

(a) government or other public administration, including public advisory

bodies, at national, regional or local level,
(b) any natural or legal person performing public administrative functions
under national law, including specific duties, activities or services in
relation to the environment, and
(c) any natural or legal person having public responsibilities or functions,
or providing public services, relating to the environment under the
control of a body or person falling within paragraph (a) or (b),

In addition:

(vi) a board or other body (but not including a company under the Com-
panies Acts) established by or under statute,
(vii) a company under the Companies Acts, in which all the shares are
held—
(I) by or on behalf of a Minister of the Government,
(II) by directors appointed by a Minister of the Government,
(III) by a board or other body within the meaning of paragraph (vi), or
(IV) by a company to which subparagraph (I) or (II) applies, having
public administrative functions and responsibilities, and pos-
sessing environmental information;

The NAMA board consists of 9 members, appointed by the Minister for Finance. The
chief executives of NAMA and the NTMA (ex-officio) are appointed by the Minister.
This alone would clearly indicate that NAMA is a public body. (vi) would appear to be
particularly relevant.

Kind regards

Gavin Sheridan

Appendix 2

! "(!
 Oifig an Choimisineara Faisneise
Office of the Information Commissioner

Background

In a request made to the National Assets Management Agency (NAMA), dated 3 February
2010, the appellant sought access under the Access to Information on the Environment (AIR)
Regulations 2007 to the following records:

1. "A breakdown of all assets, loans and properties due to be transferred to the Agency. This
should include the value placed on the asset and by whom. It should include the
addresses of all assets and properties.
2. A breakdown of all properties and property loans currently owned or controlled by the
Agency.
3. Minutes of board meetings relating to the transfer of assets and properties to the Agency.
The date range for this request is January 2009 to January 2010, inclusive."

The request was refused by NAMA on the basis that it was not a "public authority" within the
meaning of the AIE Regulations. On 19 March 2010, the appellant appealed to the
Commissioner for Environmental Information against NAMA's decision.

The Definition of "Public Authority"

Article 3(1) of the AIE Regulations state that "'public authority' means, subject to sub-article
(2)-

(a) government or other public administration, including public advisory bodies, at

national, regional or local level,

(b) any natural or legal person performing public administrative functions under national
law, including specific duties, activities or services in relation to the environment, and

(c) any natural or legal person having public responsibilities or functions, or providing
public services, relating to the environment under the control of a body or person falling
within paragraph (a ) or (b ),

and includes-

(i) a Minister of the Government,

(ii) the Commissioners of Public Works in Ireland,

(iii) a local authority for the purposes of the Local Government Act 2001 (No. 37 of
2001),

(iv) a harbour authority within the meaning of the Harbours Act 1946 (No. 9 of 1946),

1 8 Sraid Liosain lochtarach, Baile Atha Cliath 2. I 1 8 Lower Leeson Street, Dublin 2.
Tel: + 3 5 3 1 6 3 9 5 6 8 9 Fax: + 3 5 3 1 6 3 9 5 6 7 4 W e b : www.oic.gov.ie
 (v) the Health Service Executive established under the Health Act 2004 (No. 42 of 2004),

(vi) a board or other body (but not including a company under the Companies Acts)
established by or under statute,

(vii) a company under the Companies Acts, in which all the shares arc held-

(I) by or on behalf of a Minister of the Government,

(II) by directors appointed by a Minister of the Government,

(III) by a board or other body within the meaning of paragraph (vi), or

(IV) by a company to which subparagraphs (i) or (II) applies, having public

administrative functions and responsibilities, and possessing environmental
information".

Article 3(2) states: "Notwithstanding anything in sub-article (I), 'public authority' does not
include any body when acting in a judicial or legislative capacity."

The Appellant's Position

Initially, the appellant noted that the NAMA Board consists of nine members, all of whom are
appointed by the Minister for Finance. He stressed that the Chief Executives of NAMA and
the National Treasury Management Agency (NTMA), both of whom are ex-officio members,
are appointed by the Minister. He contended that, on this basis alone, NAMA should be
considered to be a "public body", and he referred in particular to paragraph (a) and
subparagraph (vi) of the definition of "public authority".

Subsequently, in a submission made on 22 April 2010, the appellant refers to Decision Notice
FER0265609 (dated 17 December 2009) in which the UK Information Commissioner's Officc
(ICO) found that PhonepayPlus, a consumer protection body responsible for regulating
'Controlled Premium Rale Services' in the UK, was a public authority for purposes of the UK
Environmental Information Regulations (EIR). After summarising the ICO's decision, the
appellant states: "While NAMA may or may not fall within under the administrative element
of the EIR, it is important to point to the scope of bodies considered to be public in other
jurisdictions, under the administrative element." The appellant also quotes from a letter by
Eurostat, dated 16 October 2009, to the Central Statistics Office as follows: '"NAMA is
publicly owned and has as its purpose to conduct specific government policy . . . according to
the decision of 15 July 2009 . . . it is to be classified within the general government sector.'"
In addition, referring to another decision of the ICO involving information relating to housing
developments, the appellant suggests that "property information could potentially be
environmental in nature".

NAMA's Position

For its part, NAMA acknowledges, in a submission dated 7 May 2010, that it is a body
established by statute, namely, the National Asset Management Agency Act 2009 (the Act).
However, according to NAMA, it does not automatically follow that NAMA is a "public

2
authority" for the purposes of the AIE Regulations. Referring to its purposes and functions as
set out in the 2009 Act, NAMA states: "NAMA is not a public administration body or a
public advisory nor does it perform public administrative functions including specific duties,
activities or services in relation to the environment." NAMA further states:

'"None of the purposes or functions conferred on NAMA

in order to achieve the Act's purposes can properly be
characterised as either public administration or public
advisory and specifically none of its functions relate to
the environment.

While NAMA was established by statute and assigned

its statutory functions in order to further the public
policy objectives of the Act, NAMA does not administer
the Act's policy, it does not provide services in
furtherance of that policy and specifically it does not
carry out duties, activities or services relating to the
environment."

Moreover, NAMA maintains that, in order to achieve its statutory purposes: "NAMA must
manage its acquired assets with a commercial mandate which is not administrative in nature.
Ultimately, NAMA's aim is to achieve the best achievable financial return for the State and
this is not an aim that is achievable if NAMA's functions were administrative or advisory in
nature." Alternatively, NAMA argues that the appellant's request does not relate to
"environmental information" within the meaning of the AIE Regulations.

Analysis

General Description of NAMA

NAMA, as its full name indicates, is an asset management agency of the State. It was
established by the National Asset Management Act 2009, the stated objectives of which are,
as set out in section 2 and summarised by NAMA in its submission:

(a) to address the serious threat to the economy and the stability of credit institutions in the
State generally and the need for the maintenance and stabilisation of the financial system in
the State, and

(b) to address the compelling need to facilitate the availability of credit in the economy, to
resolve the problems created by the financial crisis, to protect the State's interests in respect of
the guarantees issued to certain credit institutions, to facilitate restructuring of credit
institutions of systemic importance to the economy and to remove uncertainty about the
valuation of certain assets of systemically important credit institutions.

Under section 10(1) of the Act, NAMA's purpose is to contribute to the achievement of the
general purposes stated above by:

(a) acquiring eligible bank assets from participating institutions

(b) dealing expeditiously with acquired assets

3
(c) protecting or otherwise enhancing the value of acquired assets, in the interests of the State.

Section 10(2) provides: "So far as possible, NAMA shall, expeditiously and consistently with
the achievement of the purposes specified in subsection (1) , obtain the best achievable
financial return for the State".

NAMA's functions and powers are set out in sections 11 and 12 of the Act, respectively. In
addition, other sections of the Act give NAMA certain special powers. For instance, under
section 147, NAMA may appoint statutory receivers in certain circumstances. In addition,
taken together, sections 158 and 159 allow NAMA to apply to the Court for an order
authorising it to compulsorily acquire land in certain other circumstances.

It is indisputable that NAMA is a public sector body. As noted by the appellant, its Board
members are all appointed by the Minister. I also note that it has a number of reporting
requirements, it is accountable to the Comptroller and Auditor General and also to the
Committee of Public Accounts, and it is of course publicly funded (directly in terms of such
matters as remuneration; indirectly at least in relation to asset acquisition). However, as
discussed more fully below, it is also beyond dispute that asset management is a commercial
activity. I consider that the question presented by this case is whether, notwithstanding its
"commercial mandate", NAMA performs "public administrative functions" within the
meaning of Article 3(1 )(b) of the AIE Regulations.

The Meaning of "Public Administrative Functions"

I take the view that Article 3(1 )(a) of the definition of "public authority" is meant to refer to a
Department of State or local authority or other State body within the executive branch of
govermnent; it does not refer to a body with an economic or commercial mandate such as
NAMA. Moreover, although the appellant indicates in his submission that "property
information could potentially be environmental in nature", he does not make the claim, nor is
there any basis for finding, that NAMA has public responsibilities or functions, or provides
public services, relating to the environment (Article 3(l)(c) refers). While its functions may
ultimately entail the acquisition of property, like any other property developer, it is required
to apply for planning permission in order to develop the land or minerals on land (section
12(2)(z) and (aa) of the Act refers). Therefore, as the appellant appears to concede, at least
implicitly, in his submission, the question of NAMA's status the AIE Regulations turns on
whether it performs what are considered to be "public administrative functions" within the
meaning of Article 3(1 )(b) of the AIE Regulations.

PhonepayPlus (ICO Decision Notice FER0265609) in Context

I have had regard to the decision of the ICO in the PhonepayPlus case. In its decision, the
ICO set out a number of factors for consideration in determining whether a body exercises
functions that are "public in nature". In doing so, the ICO referred to the decision of the UK
Information Tribunal in Network Rail Limited v Information Commissioner (EA/2006/0061
& 0062) (17 July 2007), which in turn drew upon the judgment of Lord Nicholl in Porochial
Church Council of the Parish of Aston Cantlow and Wilmcote with Billesley v. Wallbank and
Another [2003] UKHL 37. In light of this, I find the decision of the ICO in the PhonepayPlus
case of limited usefulness in relation to NAMA for two reasons. Firstly, in the National Rail
Limited (NRL) case, the Tribunal applied the list of factors in determining whether the NRL
was a public sector body at all, a matter which is not for dispute in this case. As discussed

4
below, the focus of its analysis in relation to whether the NRL performed "functions of public
administration" was quite different.

Secondly, the Porochial Church Council (PCC) case involved the definition of "public
authority" in the context of the European Convention on Human Rights (ECHR) as it related
to a parochial church council that had certain enforcement powers, but where such powers
were only of an ecclesiastical reach. In the circumstances, the House of Lords did not acccpt
that the PCC carried out "functions of a public nature" notwithstanding its limited
enforcement powers. However, Lord Hope observed: "The word 'authority' suggests that the
person has regulatory or coercive powers given to it by statute or by the common law." He
subsequently stated: "The phrase 'public functions' in this context [the context of defining
'governmental organisations' within the meaning of the ECHR] is thus clearly linked to the
functions and powers, whether centralised or distributed, of government."

Moreover, in his judgment, Lord Rodger also referred to the significance of the exercise of
governmental powers in ECHR case law before observing: "In light of these decisions what
matters is that the PCC's general function is to carry out the religious mission of the Church
in the parish, rather than to exercise any governmental power." He also had regard to the
semantic differences in the German language, where the "public power" exercised by
churches is described as "offentliche Gewalt" as compared to "staatliche Gewalt" or "state
power". He concluded: "The PCC may be acting in the public interest, in a general sense,
but it is still carrying out a church rather than a governmental function."

Based on my examination of relevant European and UK case law, including the NRL and the
PCC cases, it is my understanding that the exercise of some such "public" or governmental
power is in fact an essential component of a "public administrative function"; i.e, without the
exercise of such governmental power, functions are not of a public administrative nature
regardless of whether they have a statutory basis or whether they serve a general public
interest. The typical example is that of a regulatory function, but it would also include
functions involving the power to issue licenses, powers of inspection or investigation or other
policing powers, and powers of taxation. Moreover, under EU law, where a distinction is
drawn between functions which are "public" on the one hand and functions which are
commercial or economic on the other, the exercise of public or governmental authority seems
to be implicit in the term "public function" alone.

The Irish Guidance Notes and the Aarhus Guide

In Ireland, the starting point for interpreting any of the provisions of the AIE Regulations
should be the Guidance Notes published by the Irish Department of the Environment,
Heritage and Local Government. However, the Guidance Notes do not expand upon the
meaning of "public administrative functions" beyond stating that it is "self-evident". While
this guidance may not be very descriptive, it does suggest, nevertheless, that a multifaceted
approach to the definition was not envisioned.

The Guidance Notes also explain that EU Directive 2003/4/EC (the AIE Directive), upon
which the AIE Regulations are based, was adopted to give effect to one part of what is known
as the Aarhus Convention. In the circumstances, it is appropriate to consider the
Implementation Guide to the Aarhus Convention (the Aarhus Guide). The Aarhus Guide
describes a "public administrative function" as "a function normally performed by
governmental authorities as determined according to national law". (A section of the Aarhus

5
Guide relating to the EU, or the European Community as the relevant pillar was known then,
explains that a reference to national law should encompass EU law.) The Aarhus Guide
further states: "Any person authorized by law to perform a public function of any kind falls
under the definition of'public authority'".

The NRL Case and Other Relevant UK Guidance

In the NRL case, the Tribunal had regard to the Aarhus Guide and similar UK-based guidance
in finding that the NRL was not a body which carried out public administrative functions.
The determinative factor was that it was not a regulator; rather, its functions were that of any
commercial operator. The Tribunal also observed: "Whatever the position in 1947, running a
railway is not seen nowadays in the United Kingdom as a function normally performed by a
government authority." The Tribunal underscored the distinction between public
administrative functions and commercial activities, even with respect to railways which
receive public funds or remain in public ownership, by referencing the relevant Council
Directive on the development of the European Community's railways: "To summarise, the
Directive which gave birth in large measure to the 1993 Act adopts the principle that running
railways is an activity for independent bodies, however created and funded, operating as
competitive, commercial concerns according to the dictates of the market. Such an approach
is the antithesis of the proposition that running railways is a function of governmental
authorities."

Following the Tribunal's lead, the ICO found in Decision Notice FER0265609 that
PhonepayPlus carried out administrative functions on the basis that it "is a regulator of a
specified area". Reference was also made to the distinction between commercial activities
and administrative functions: "In this case the organisation is not [a] profit making entity and
is not an organisation that is competitively involved in any business. Instead it has a specific
function to regulate a specific area, overseeing an industry, which it is independent of. As
explained above the organisation conducts functions that can be correctly explained as
administrative." However, as indicated above, the ICO also had regard to numerous factors
other factors which I consider to be ancillary for the purposes of this case.

The connection between governmental power and public administrative functions, and the
corresponding distinction between public administrative functions and commercial or
economic activities, are also highlighted in the case of Law Society of England and Wales v.
Secretary of State for Justice & Anor [2010] EWHC 352 (QB) in which the England and
Wales High Court addressed the question of whether the Law Society was a public
administrative body in the context of the Transfer of Undertakings (Protection of
Employment) Regulations 2006, which is based on EU Directive 2001/23/EC. Article 1(1) of
the Directive states that:

"(a) This directive shall apply to any transfer of an

undertaking, business, or part of an undertaking or
business to another employer as a result of a legal
transfer or merger.

(c) This directive shall apply to public and private

undertakings engaged in economic activities whether or

6
 not they are operating for gain. An administrative
reorganisation of public administrative authorities, or the
transfer of administrative functions between public
administrative authorities, is not a transfer within the
meaning of this directive."

Following the creation of the Office for Legal Complaints, the Law Society attempted to
secure certain employment rights for its staff in its Legal Complaints Service unit by arguing
that the Transfer of Undertakings Regulations applied notwithstanding the exclusion from its
scope of a transfer of administrative functions between public administrative authorities.
Referring to European Court of Justice (ECJ) Case C-298/94 Annette Henke v. Gemeinde
Schierke and Verwaltungsgemeinschaft Brocken , the High Court noted that Paragraph 17 of
the judgment "provides a pointer to what a public administrative body might be considered to
be: a body which exercises public authority". The High Court also quoted from the decision
of the Employment Appeal Tribunal in Adult Learning Lnspectorate v Beloff (30 January
2008): '"In our judgment, a public body whose functions involve the exercise of public
authority would be a public administrative authority for the purposes of [the Transfer of
Undertakings Regulations]." On the basis of the House of Lords case of Institute of
Chartered Accountants v. Commissioners for Customs & Excise [1991] 1 WLR 701, which
in turn referred to ECJ Case C-364/92 SATFluggesellschaft mbHv. Eurocontrol , the High
Court concluded that: "[RJegulatory functions can (and should here) be distinguished from
economic activity." As the transfer in question involved the regulatory functions of the Legal
Complaints Service, the High Court found that the Transfer of Undertakings Regulations did
not apply.

Neurendale (Irish High Court) and EU Competition Law

Moreover, in Neurendale Ltd t/a Panda Waste Services v. Dublin City Council & Ors [2009]
IEHC 588, the Irish High Court (McKechnie J.) provided a very helpful overview of EU
competition law as it applies to public authorities, which again illustrates the connection
between governmental power and public administrative functions, and the corresponding
distinction between public administrative functions and commercial or economic activities.
The focus of the overview was on the question of when, and in what circumstances, a public
authority is considered to be an "undertaking", which McKechnie J. defined as "any body,
regardless of how it is established or how it is funded, or of its legal status, which is engaged
in an economic activity, or to have the same meaning, in a commercial activity". An
economic activity, in turn, consists of "offering goods or services on a market, usually
although not necessarily for a fee or charge". Observing that "[i]t is possible for a body to be
both an undertaking, and not be so, depending on the activity in question", McKechnie J.
stated: "Consequently, the fact that a body exercises regulatory or public powers will not
automatically exclude all of its activities from being considered economic in nature." As the
exercise of "purely sovereign or administrative powers" falls outside the scope of EU
competition law, each activity of a public entity is scrutinised separately to determine whether
the entity concerned should be treated as an undertaking or as a public body. McKechnie J.
quoted from the Opinion of the Advocate General in Case C-49/07, known as the MOTOE
case, in which it is explained:

"It is true that the exercise of public powers does not fall
within the scope of the competition rules in the EC
Treaty, and an organisation which exercises public

7
 powers is not an undertaking within the meaning of
competition law. However, the distinction between
public and economic activities must be drawn separately
in relation to each activity carried on by an organisation.
The organisation in question may therefore operate in
part as a public body and in part as an economic agent."

Significantly, a public entity may be considered to be an undertaking even where it operates

in the public interest: "[Wjhere the organisation concerncd begins to market its services, it
moves away from the sphere of exclusively social or public interest activity; the mere fact that
it continues at the same time to pursue an aim in the general interest. . . and does not seek to
make a profit is no longer sufficient for it to be denied the status of undertaking within the
meaning of competition law." (.MOTOE , quoted by McKechnie J.) In other words, a public
entity, including a body with public or governmental powers and which generally operates in
the public interest, may act commercially, and when it does so, it is no longer acting in its
public or governmental capacity; rather, it becomes an economic agent, an undertaking.

The crucial question for this case, however, is when, and in what circumstances, a public
entity is considered to be carrying out public administrative functions which are connected
with the exercise of public or governmental powers, as opposed to commercial or economic
or activities which are not. I believe the answer is provided by contrasting the Eurocontrol
case referred to above with Case T-196/04 Ryanair v. Commission of the European
Communities , both of which are discussed at some length by McKechnie J. Eurocontrol is
the European Organisation for the Safety of Air Navigation. Its function is to establish and
collect charges levied on users of air navigation services. In determining whether Eurocontrol
was an undertaking or whether its activities fell within the exercise of sovereign or
administrative powers, and thus outside the scope of the competition rules, ECJ examined its
activities and noted, among other things, that "Eurocontrol is required to provide navigation
control in that air space for the benefit of any aircraft travelling through it, even where the
owner of the aircraft has not paid the route charges owed to Eurocontrol". The ECJ
concluded: "Taken as a whole, Eurocontrol's activities, by their nature, their aim and the
rules to which they are subject, are connected with the exercise of powers relating to the
control and supervision of air space which are typically those of a public authority. They are
not of an economic nature justifying the application of the Treaty rules of competition."

In contrast, in the Ryanair case, the ECJ found that "[t]he fixing of the amount of landing
charges and the accompanying indemnity is an activity directly connected with the
management of airport infrastructure, which is an economic activity". The ECJ explained:
"[A]lthough such activities are carried out in the public sector, they cannot, for that reason
alone, be categorised as the exercise of public authority powers. Those activities are not, by
reason of their nature, their purpose or the rules to which they are subject, connected with the
exercise of powers which are typically those of a public authority".

In addition, I have had regard to the Opinion of the Advocate General in Case C-3 90/98 H.J.
Banks & Company Ltd v. The Coal Authority and the Secretary of State for Trade and
Industry , a case involving issues regarding State aid. The background to the case is
complicated, but it is sufficient to note for the purposes of this case that a distinction was
made between the "public functions" of the Coal Authority, i.e. its licensing functions, and
the private, commercial nature of its leasing functions, though both types of functions were

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statute-based. Moreover, the fields of public investment and public disposal of assets were
expressly described as "State commercial activity".

Conclusion
I conclude that public administrative functions are activities connected with the exercise of
public or sovereign powers, i.e. activities which are typically governmental in nature. They
are activities which, "by their nature, their aim and the rules to which they are subject, are
connected with the exercise of powers . . . which are typically those of public authority."
Such functions generally involve the exercise of supervision and control, with the typical
example being regulatory functions. Public administrative functions are distinct from
activities which are economic or commercial in nature, even if the economic or commercial
activities are performed by a public sector body on a statutory basis and in the public interest.
In my view, this interpretation is also consistent with the Aarhus Guide.

Conclusion Regarding the Status of NAMA

As the European Central Bank found in its opinion of 31 August 2009 on the establishment of
NAMA, available at www.nama.ie, NAMA qualifies as a "public undertaking". Its function
is asset management with the aim of securing the best achievable financial return for the
State, which is undoubtedly commercial in nature. Asset management is certainly not
considered to be a typical governmental function; i.e., it is not one that, under normal
circumstances, any public authority would normally be expected to perform. Participation by
credit institutions in the asset management scheme is voluntary and in fact selective; thus,
NAMA is not exercising powers of supervision and control over a general area of the
financial system. On the contrary, relevant regulatory powers remain with the Central Bank
and Irish Financial Services Regulatory Authority (section 3 of the Act refers).

NAMA has been granted certain special powers which, as the European Commission has
observed, are not available to "traditional market players". However, the powers are entirely
discretionary and in fact subject to certain commitments which have been agreed between the
Minister and the Commission. In other words, NAMA is under no duty to exercise these
powers, as is the case in relation to regulatory powers, for instance. Moreover, the powers are
not typically those of a governmental authority. The power which most resembles a power of
a governmental authority is the power to compulsorily acquire land (section 158 of the Act
refers). However, unlike a local authority, NAMA's power is subject to court order (section
159 of the Act refers). Also, NAMA's powers serve no public purpose, such as
implementation of a Development Plan, apart from enabling NAMA to obtain the best
achievable return for the State as efficiently as possible. The Commission itself described the
purpose of the powers, and other special rights and exemptions granted to NAMA, as "to help
the agency achieve the maximum recovery value for the assets". In other words, they are
commercial powers.

I further note that, in its decision dated 26 February 2010, available at www.nama.ie, the
Commission found that the asset relief scheme constitutes State aid under Article 107(1) of
the Treaty on the Functioning of the European Union (TFEU), but, subject to the
commitments referred to above, the aid is considered permissible under Article 107(3)(b) in
order "to remedy a serious disturbance in the Irish economy". Arguably, NAMA could be
viewed as "administering" the aid in the sense that it manages the asset relief scheme.
However, the scheme qualifies as State aid because of the favourable financial arrangements
in place, not because of any public or special powers or rights conferred on NAMA in

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violation of Article 106 of the TFEU. Moreover, while the financial arrangements include
State guaranteed bonds, it is the Minister, not NAMA, who issues the guarantee (sections
48(3) and 50(2) of the Act refer). It is also the Minister, not NAMA, who may draw from the
Central Fund (section 47 of the Act refers). Moreover, it is relevant to note that the provision
of State aid itself is no longer a normal governmental function for EU Member States,
because it is "incompatible with the internal market" (Article 107(1) of the TFEU refers).
Hence, even where it is considered to be "compatible" because of exceptional circumstances,
as is the case with the asset relief scheme, it is subject to "constant review" by the
Commissioner (Article 108(1) of the TFEU refers).

I conclude that NAMA is an economic agent for the State, but not one that performs public
administrative functions. NAMA therefore is not a public authority for purposes of the AIE
Regulations. In the circumstances, it is not necessaiy to consider whether it holds, or may
potentially hold, environmental information.

Melanie Campbell
Investigator
29 June 2010

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