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Document
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PO-1675
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File #
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PA-980210-1
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Institution/HIC
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Ministry of the Natural Resources
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Summary
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BACKGROUND The Ministry of Natural Resources (the Ministry) indicates that the statutory authority for the forest management on Crown lands is the Crown Forest Sustainability Act (the CFSA ). Pursuant to section 7 of the CFSA , Crown lands are divided into Crown Management Units (CMUs). Operators that wish to harvest forest resources must have either a forest resource licence issued under section 27, or a Sustainable Forest Licence (SFL) issued under section 26 of the CFSA . SFLs are long term evergreen licences which cover an entire CMU. Overlapping forest resource licences may be issued to smaller operators on areas subject to a SFL, pursuant to section 38. In these instances, an overlapping agreement must be negotiated between the operator and the holder of the SFL. Holders of a SFL are responsible for preparing a forest management plan and for forest renewal on the CMU. The Ministry states that it has been encouraging smaller and medium sized forest companies and businesses to form corporations for the purpose of obtaining a SFL. In these cases, the corporation assumes responsibility for preparing the forest management plan, and does forest renewal on the CMU. The operation of the corporation is governed by a shareholders' agreement, negotiated by the various participating operators. The Ministry states that it is not a party to any such agreement. Rather, the Ministry's role is to review the shareholder agreement and assess the viability of the corporation before issuing a SFL. NATURE OF THE APPEAL: A group of operators formed a forest management company for the purposes of obtaining a SFL. These operators negotiated a shareholders agreement. The Ministry received a request under the Freedom of Information and Protection of Privacy Act (the Act ) for access to this shareholders' agreement. Before responding to the request, the Ministry notified the forest management company (the affected party), pursuant to section 28 of the Act , seeking its views on the possible disclosure of the record. After considering the affected party's response, the Ministry issued its decision to the requester denying access to the record pursuant to section 17(1) of the Act (third party information). The requester, now the appellant, appealed this decision. I sent a Notice of Inquiry to the Ministry, the appellant and the affected party, as well as the 25 operators who were parties to the Shareholders' Agreement (the other affected parties) and certain individuals identified in the record whose personal interests might be affected by disclosure (the affected persons). I included section 21 of the Act (invasion of privacy) in the Notice as a possible relevant exemption claim. Representations were received from the appellant, the Ministry and the affected party, but not from any of the other affected parties or any of the affected persons. DISCUSSION: THIRD PARTY INFORMATION Sections 17(1)(a), (b) and (c) of the Act state: A head shall refuse to disclose a record that reveals a trade secret or scientific, technical, commercial, financial or labour relations information, supplied in confidence implicitly or explicitly, where the disclosure could reasonably be expected to, (a) prejudice significantly the competitive position or interfere significantly with the contractual or other negotiations of a person, group of persons, or organization; (b) result in similar information no longer being supplied to the institution where it is in the public interest that similar information continue to be so supplied; (c) result in undue loss or gain to any person, group, committee or financial institution or agency; or For the record to qualify for exemption under sections 17(1)(a), (b) or (c), the Ministry and/or the affected party must satisfy each part of the following three-part test: 1. the record must reveal information that is a trade secret or scientific, technical, commercial, financial or labour relations information; and 2. the information must have been supplied to the Ministry in confidence, either implicitly or explicitly; and 3. the prospect of disclosure of the record must give rise to a reasonable expectation that one of the harms specified in (a), (b) or (c) of subsection 17(1) will occur. [Order 36] Part One "Commercial information" has been defined in past orders to mean information which relates solely to the buying, selling or exchange of merchandise or services. The term "commercial" information can apply can apply to both profit-making enterprises and non-profit organizations, and has equal application to both large and small enterprises [Order P-493]. "Financial information" has been defined in past orders to mean information relating to money and its use or distribution and must contain or refer to specific data. For example, cost accounting method, pricing practices, profit and loss data, overhead and operating costs [Orders P-47, P-87, P-113, P-228, P-295 and P-394]. The Ministry submits that the record contains commercial information. It states that the affected party is a corporation formed by a number of operators whose businesses involve the harvesting and processing or milling of timber for the purpose of holding a SFL. The Ministry submits that: The Agreement contains or outlines financial information and details relating to the business relationship of the shareholders, their employment and assets in the area. The affected party adds that: The agreement reveals commercial information regarding the internal management of the corporation, the transfer of shares, the shareholders of the corporation, and the internal financial management of the corporation. For example, there are provisions regarding the purchase and sale of shares of these corporations. The appellant argues that the information contained in the record is of a general corporate nature and does not relate to commercial functions such as the buying, selling or exchange of products, property, goods or services. The Shareholders' Agreement itself sets out very specific provisions regarding the operation of the corporation, including the manner it which it conducts business and how various financial aspects of the licence arrangement will operate. In my view, the information in the record clearly meets the criteria of "commercial" and "financial" information for the purposes of section 17(1). Part Two In order to satisfy part two of the test, the Ministry and/or the affected party must show that the information was supplied to the Ministry, either implicitly or explicitly in confidence . Supplied The Ministry and the affected party both submit that the record was supplied to the Ministry by the affected party, at the Ministry's request, to determine whether the affected party was a suitable candidate for the issuance of the SFL. The appellant submits: As regards the phrase "supplied" in subsection 17(1) of the Act, the Shareholders' Agr
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Legislation
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FIPPA
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17(1)(a)
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28(1)
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17(1)
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Subject Index
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Signed by
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Tom Mitchinson
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Published
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May 11, 1999
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Type
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Order
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