The long-awaited ruling by the Court of First Instance (CFI) in Akzo Nobel has for the moment removed all hope that in-house lawyers could invoke the same rights of legal professional privilege (LPP) for European Commission (EC) law purposes that are enjoyed by independent external lawyers. The fact that the CFI reached a pragmatic rather than a principled decision in a case that cried out for a principled analysis must make the disappointment experienced by in-house lawyers about their differential treatment even more acute, despite the reality of the last 25 years.

The judgment warrants many criticisms but two stand out above the rest. Firstly, the ruling assumes incorrectly that in-house lawyers enjoy the luxury of delaying pressurised internal requests for high-level compliance assessments in order to access external legal advice; and secondly, there is no concrete evidence presented in the judgment suggesting that in-house lawyers observe rules of ethics that are so different to those applicable to external lawyers that the EC's task of ensuring competition compliance would be subverted. Indeed, the ruling appears premised on an unstated and unwelcome inference that competition law enforcement would become harder as a result of granting LPP to in-house lawyers.

If the CFI really believes, as it implies, that it is hamstrung by the European Court of Justice's (ECJ's) ruling in AM&S, it could have done more to flag up certain issues that merit exploration by the ECJ or, indeed, by the legislators. These could have included reliance on the European Union (EU) doctrine of equivalence to encourage the levelling up of disparate national and EU standards on LPP. Alternatively, as a first step, the CFI could have explored the feasibility of a hybrid LPP system for in-house lawyers involving the creation of a rebuttable presumption that LPP applies to certain categories of internal documents created by in-house lawyers (e.g. to those created under the framework of an existing compliance policy).

The fact that many of the adverse effects of the distinction in treatment between in-house and external lawyers can be mitigated by using oral communications or routing documents through external counsel only serves to reinforce defensive corporate cultures and buries significant internal debate on competition compliance.

Disappointingly, the CFI fails to recognise the pro-competition compliance benefits of having qualified lawyers at the heart of businesses where, with the protection of LPP, they would be capable of policing more effectively and aggressively any potential anti-competitive behaviour. Placed in this context, the CFI's ruling appears counter-intuitive and almost disproportionate in its effect. It seeks to keep the hypothetical door open for EC officials to access certain classes of documents, even though the overall number of EC investigations each year is relatively small.

The ruling does, however, offer two crumbs of comfort on the privilege front. Intriguingly, the CFI's decision to extend LPP to certain types of preparatory documents that are created exclusively for the purpose of seeking advice from an external lawyer, even though such documents might not even be sent to an external lawyer, offers the rare prospect of EC law on LPP for competition purposes being wider in some circumstances than under the common law. This new distinction could re-ignite a debate (recently 'parked' in the Competition Appeal Tribunal) over whether section 60 of the Competition Act 1998 could be used to import into the UK legal system any EU procedural guarantees that are more extensive than those existing in the common law.

The second crumb concerns the sensible clarification over the correct procedures to follow when a claim to LPP is disputed by EC officials during a dawn raid. Although the CFI's tidying-up will remove some unnecessary tensions during raids, on the scale of worries facing in-house lawyers it is only of marginal practical interest.

While it would be wrong to use the CFI's conservative judgment in Akzo Nobel as a justificatory argument for the creation of a new EU Competition Court, the ruling does expose for debate the extent to which independent practitioners (as indirect beneficiaries of the CFI's ruling) could do more to force the agenda for collective LPP reform at EU level. While the immediate battle may be lost, the forceful principled arguments for equivalence in treatment in LPP issues remain morally intact. Should Akzo Nobel decide to appeal, independent practitioners should push vigorously for the removal of the outdated straightjacket created by the ECJ's ruling in AM&S.

Adrian Wood is a senior associate and professional support lawyer in the European Union and competition group at Pinsent Masons.