In-house lawyers throughout the western world are up in arms after the European Court of Justice on Tuesday denied in-house counsel the protection of privilege in antitrust cases.

The Sept. 14 ruling brought to an end a fierce and long-running battle involving Dutch chemicals giant Akzo Nobel, which claimed that documents seized by a European Commission team during a 2003 raid on its U.K. offices were covered by attorney-client privilege.

Association of Corporate Counsel general counsel Susan Hackett was just one of several senior figures to publicly criticize the ECJ decision, which seemingly betrays a lack of confidence by the European judiciary in the ability of in-house lawyers to remain impartial. In its judgment, the European Union’s highest court refused to afford in-house counsel the same status as external advisers because they are “in a fundamentally different position” — essentially criticizing the role of in-house lawyer as one of insurmountable professional and ethical conflict.

The ruling applies only to EU competition investigations — Europe’s in-housers are covered by privilege in all other matters — but to have their credibility undermined in so public and decisive a manner makes the ruling a bitter pill to swallow, particularly as it contradicts recent moves to grant their external peers greater freedom in such matters.

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