Information pertaining to MSTC Ltd. claim of Rs. 430 crores - how was it concluded that these buyers were worth risk taking by the ECGC Ltd.? - CIC: divulging this information may irreparable damage to the public authority - exempt u/s 8(1)(d) & 8(1)(e)
16 Oct, 2013ORDER
Shri Harinder Dhingra, hereinafter called the appellant has filed this appeal dated 29.8.2011 before the Commission against the Export Credit & Guarantee Corporation of India Ltd., Gurgaon for denial of information on Point No. 1 and 2 in response to his RTI-request dated 11.6.2011. The matter was earlier heard by the Commission on 24.4.2012 and the Commission vide its order of even number dated 30.4.2012 held as follows:
“Having considered the submissions of the parties and perused the relevant documents on file, the Commission is of the view that the respondent failed to adequately explain their position regarding non-disclosure of information u/s 8(1)(d) Notwithstanding anything contained in this Act, there shall be no obligation to give any citizen, information including commercial confidence, trade secrets or intellectual property, the disclosure of which would harm the competitive position of a third party, unless the competent authority is satisfied that larger public interest warrants the disclosure of such information; Notwithstanding anything contained in this Act, there shall be no obligation to give any citizen, information including commercial confidence, trade secrets or intellectual property, the disclosure of which would harm the competitive position of a third party, unless the competent authority is satisfied that larger public interest warrants the disclosure of such information; Notwithstanding anything contained in this Act, there shall be no obligation to give any citizen, information including commercial confidence, trade secrets or intellectual property, the disclosure of which would harm the competitive position of a third party, unless the competent authority is satisfied that larger public interest warrants the disclosure of such information; Notwithstanding anything contained in this Act, there shall be no obligation to give any citizen, information including commercial confidence, trade secrets or intellectual property, the disclosure of which would harm the competitive position of a third party, unless the competent authority is satisfied that larger public interest warrants the disclosure of such information; & 8(1)(e) Notwithstanding anything contained in this Act, there shall be no obligation to give any citizen, information available to a person in his fiduciary relationship, unless the competent authority is satisfied that the larger public interest warrants the disclosure of such information; Notwithstanding anything contained in this Act, there shall be no obligation to give any citizen, information available to a person in his fiduciary relationship, unless the competent authority is satisfied that the larger public interest warrants the disclosure of such information; Notwithstanding anything contained in this Act, there shall be no obligation to give any citizen, information available to a person in his fiduciary relationship, unless the competent authority is satisfied that the larger public interest warrants the disclosure of such information; of the RTI Act. The FAA is hereby directed to file his written submissions before the Commission how disclosure of information is going to harm the competitive position of third party within two weeks of receipt of this order.” The matter was listed for hearing on 07.06.2012 and again on 01.08.2013. The appellant was absent whereas the respondent were represented by Shri P.L. Khakur, DGM & Regional Manager/FAA and Shri Amit Kumar Baidya, Assistant Manager.
Background:
“3. The appellant filed an dated 11.6.2011 under the RTI Act, 2005 seeking information on seven queries pertaining to MSTC Ltd. claim of Rs. 430 crores, which was rejected by ECGC. The appellant sought information on Point No. 1 and 2 as follows:
“(1) Kindly provide complete correspondence including file notings, inter office communication, correspondence with your Head Office, any other office and with the MSTC Ltd related to MSTC Ltd claim of Rs. 430 crores or so which was rejected by your organization vide letter No,. HO/:POL. CLAIMS/ER/2010 dated 14.5.2010;
(2) Provide whole information related to your approval of buyers of UAE/Dubai/Gulf Countries in this case by your in house research team/taken the inputs from third agency of these buyers or how you came to conclusions that these buyers were worth risk taking by the ECGC Ltd. leading to your organization giving approval of these buyers to MSTC Ltd”.
The CPIO vide his letter dated 8.7.2011 denied information on Point No. 1 to 2 of the RTI application claiming exemption under the provisions of Section 8(1)(d) Notwithstanding anything contained in this Act, there shall be no obligation to give any citizen, information including commercial confidence, trade secrets or intellectual property, the disclosure of which would harm the competitive position of a third party, unless the competent authority is satisfied that larger public interest warrants the disclosure of such information; Notwithstanding anything contained in this Act, there shall be no obligation to give any citizen, information including commercial confidence, trade secrets or intellectual property, the disclosure of which would harm the competitive position of a third party, unless the competent authority is satisfied that larger public interest warrants the disclosure of such information; Notwithstanding anything contained in this Act, there shall be no obligation to give any citizen, information including commercial confidence, trade secrets or intellectual property, the disclosure of which would harm the competitive position of a third party, unless the competent authority is satisfied that larger public interest warrants the disclosure of such information; Notwithstanding anything contained in this Act, there shall be no obligation to give any citizen, information including commercial confidence, trade secrets or intellectual property, the disclosure of which would harm the competitive position of a third party, unless the competent authority is satisfied that larger public interest warrants the disclosure of such information; & 8(1)(e) Notwithstanding anything contained in this Act, there shall be no obligation to give any citizen, information available to a person in his fiduciary relationship, unless the competent authority is satisfied that the larger public interest warrants the disclosure of such information; Notwithstanding anything contained in this Act, there shall be no obligation to give any citizen, information available to a person in his fiduciary relationship, unless the competent authority is satisfied that the larger public interest warrants the disclosure of such information; Notwithstanding anything contained in this Act, there shall be no obligation to give any citizen, information available to a person in his fiduciary relationship, unless the competent authority is satisfied that the larger public interest warrants the disclosure of such information; of the RTI Act, 2005 and on remaining points provided information to the appellant.
3.1. Aggrieved by the reply of the CPIO, the appellant preferred first-appeal dated 19.7.2010 before FAA. The FAA, vide letter No. ECGC:ERO:RTI:2011 dated 18.8.2011 upheld the reply of the CPIO.”
4. The FAA filed his written submissions before the Commission as follows:
Information as requested by the appellant at Point No. 1 and 2 of his RTI application were denied u/s 8(1)(d) Notwithstanding anything contained in this Act, there shall be no obligation to give any citizen, information including commercial confidence, trade secrets or intellectual property, the disclosure of which would harm the competitive position of a third party, unless the competent authority is satisfied that larger public interest warrants the disclosure of such information; Notwithstanding anything contained in this Act, there shall be no obligation to give any citizen, information including commercial confidence, trade secrets or intellectual property, the disclosure of which would harm the competitive position of a third party, unless the competent authority is satisfied that larger public interest warrants the disclosure of such information; Notwithstanding anything contained in this Act, there shall be no obligation to give any citizen, information including commercial confidence, trade secrets or intellectual property, the disclosure of which would harm the competitive position of a third party, unless the competent authority is satisfied that larger public interest warrants the disclosure of such information; Notwithstanding anything contained in this Act, there shall be no obligation to give any citizen, information including commercial confidence, trade secrets or intellectual property, the disclosure of which would harm the competitive position of a third party, unless the competent authority is satisfied that larger public interest warrants the disclosure of such information; and 8(1)(e) Notwithstanding anything contained in this Act, there shall be no obligation to give any citizen, information available to a person in his fiduciary relationship, unless the competent authority is satisfied that the larger public interest warrants the disclosure of such information; Notwithstanding anything contained in this Act, there shall be no obligation to give any citizen, information available to a person in his fiduciary relationship, unless the competent authority is satisfied that the larger public interest warrants the disclosure of such information; Notwithstanding anything contained in this Act, there shall be no obligation to give any citizen, information available to a person in his fiduciary relationship, unless the competent authority is satisfied that the larger public interest warrants the disclosure of such information; of the RTI Act;
Insurance is a contract of good faith where the insurer is in a fiduciary relationship with its insured. An insured is required to make full and complete disclosure of all information pertaining to the subject matter of insurance that might have any bearing on the nature of risk insured, including such information as may be commercially sensitive and/or of commercial confidentiality.
ECGC’s operations are predominantly in the field of export credit insurance where ECGC underwrites the risk of loss arising from default or insolvency of the buyers. So, before the risk is assumed by ECGC, it is essential that ECGC is afforded a fair opportunity to assess the risk and for that purpose, the insured is expected to disclose to ECGC all information not only about the buyer, but also about details of his past transactions with the buyer, future plans, commodities exported/to be exported, terms on which sales are made, scale of operations with each of the buyers, past experience with the buyer, etc. These kind of information could be commercial sensitive and if made available to the competitors, that might adversely impact on the market competitiveness of the insured. He may even lose out his buyers and export market to his competitors;
Unless ECGC can vouch that any information provided to ECGC shall remain confidential and in no way shall find its way to his competitors, no insured shall be ready or willing to furnish such information to ECGC. Hence, it is necessary that ECGC gives and unequivocal assurance to all exporters that any information provided to ECGC for the purpose of, in the course of or in connection with a contract of credit insurance with ECGC shall remain confidential and will be protected from being accessed by any third party. Providing such confidentiality is a matter of utmost importance to ECGC and its business, without which ECGC would lose its credibility of being able to protect information provided to it by the insured;
As regards approval of credit limits on buyers under the policies, the process notes for the same will deal with the names of exporter(s) who want to export to that buyer, details of orders received by such exporter(s) including price details, period of credit and other terms of sale, prospect for further orders in near future, past experienced, if any, of other policyholders with that buyer, etc. along with particulars made available on the buyer in the IP-protected Credit Information Reports being purchased by ECGC from credit information agencies. None of the aforesaid information could be disclosed to a third party. Moreover, fixing of credit limits on overseas buyers is at the heart of the business of export credit insurance and now ECGC factors into its decision making process the various credit risk sensitive information being made available to it from different sources is the essence of its business advantage vis-à-vis other aspirants entering the business of export credit insurance.
In pursuance of clause (d) and (e) of sub-section (1) of Section 8 of the RTI Act, notwithstanding anything contained in the Act, ECGC shall have no obligation to give any information that are of commercial confidence and/or are made available by an insurer to ECGC in its fiduciary capacity.
5. The Commission in the matter of Shri G.P. Raju & Shri M.N. Rao Vs. The New India Assurance Company Ltd in case No. CIC/AT/2007/00707 and 00708 dated 22.8.2007 held as follows:
“But it is equally true that divulging this information may irreparable damage the capacity of the public authority to function effectively as a commercial entity engaged in a highly competitive business. One of the key elements of remaining competitive is to retain the clients’ confidence and to present an image that the company does not part with information of its interactions with such clients, to third parties. A claim made by an insured on an insurance company is a matter entirely between the company and the insured. In case it is made known that such public sector companies are being forced to disclose client-related information under the RTI Act, there may be a run on the company because most clients would not like those information to be made public. Apart from this, the company’s competitive position vis-à-vis the private companies’, which are not accountable under the RTI Act, may be irretrievably weakened, and would grossly compromise the public sector company’s ability to function as an economic entity. It is also true that the Client-Service provider relationship is essentially based upon trust and, confidentiality is the key to maintaining and retaining this trust. Exposing such transactions to disclosure requirement under the RTI Act would be detrimental to the interest, both of the Insurance firm and the clients.”
5. Consistent with the aforementioned decision of the Commission and the submissions put forth by the FAA, the Commission is of the view that the information as sought for by the appellant at Point No. 1 and 2 of his RTI application the appellant sought information relating to the claim filed by MSTC Ltd. and also in relation to giving approval of buyers’ to MSTC Ltd. is clearly exempted from disclosure under Section 8(1)(d) Notwithstanding anything contained in this Act, there shall be no obligation to give any citizen, information including commercial confidence, trade secrets or intellectual property, the disclosure of which would harm the competitive position of a third party, unless the competent authority is satisfied that larger public interest warrants the disclosure of such information; Notwithstanding anything contained in this Act, there shall be no obligation to give any citizen, information including commercial confidence, trade secrets or intellectual property, the disclosure of which would harm the competitive position of a third party, unless the competent authority is satisfied that larger public interest warrants the disclosure of such information; Notwithstanding anything contained in this Act, there shall be no obligation to give any citizen, information including commercial confidence, trade secrets or intellectual property, the disclosure of which would harm the competitive position of a third party, unless the competent authority is satisfied that larger public interest warrants the disclosure of such information; Notwithstanding anything contained in this Act, there shall be no obligation to give any citizen, information including commercial confidence, trade secrets or intellectual property, the disclosure of which would harm the competitive position of a third party, unless the competent authority is satisfied that larger public interest warrants the disclosure of such information; and Section 8(1)(e) Notwithstanding anything contained in this Act, there shall be no obligation to give any citizen, information available to a person in his fiduciary relationship, unless the competent authority is satisfied that the larger public interest warrants the disclosure of such information; Notwithstanding anything contained in this Act, there shall be no obligation to give any citizen, information available to a person in his fiduciary relationship, unless the competent authority is satisfied that the larger public interest warrants the disclosure of such information; Notwithstanding anything contained in this Act, there shall be no obligation to give any citizen, information available to a person in his fiduciary relationship, unless the competent authority is satisfied that the larger public interest warrants the disclosure of such information; of the RTI Act. The Commission finds no reason to interfere with the replies of the respondent.
(Sushma Singh)
Information Commissioner
Citation: Shri Harinder Dhingra v. Export Credit & Guarantee Corporation of India Ltd., in Case No. CIC/SS/A/2012/000286