Consideration - the failure to decide issue
49 The critical question is whether, if the Authority decided to register either of Abbey's chemical products, apramax or tetramax, under s 8F(1)(b) of the Code or refuse either application under s 8G(1), it would disclose confidential commercial information of Bayer in breach of s 162(1) by giving Abbey notice of its decision or any reasons for a proposed or actual refusal or by publishing notice of a decision to register in the Gazette pursuant to any of ss 8F(2), 8G(2) and 8H of the Code or reg 8AN.
50 Nothing in the Code or Regulations required any publication in the Gazette to disclose the basis on which an approval had been sought or granted. Accordingly, a publication, simply of the fact that an application for registration had been granted, could not disclose anything confidential or otherwise about a reference product.
51 Importantly, s 162(1A) provides that an officer of the Authority can engage in conduct in the performance of functions or duties, or the exercise of powers, under the Code, that s 162(1) would otherwise have prohibited, because he or she would disclose (i.e. give or communicate in any way (s 162(14)) by such conduct, any information about an active constituent for a proposed or existing chemical product that the person, first, knows to be confidential commercial information and, secondly, was acquired by him or her in the performance of those functions or duties or the exercise of those powers.
52 Here, the Authority registered tetravet in 2001 and approved aprapharm in 2004. Each of their current registrations will need to be renewed from 30 June 2016. It is safe to infer that each reference product had been on the market since about the time of its registration or approval. It appears that tetravet is no longer being sold.
53 Obviously, each reference product could be tested and analysed for its properties and characteristics by anyone who purchased it. Because each product was publicly available, anything that could be ascertained by a person, including a skilled scientist, from examining the product, could not possibly be confidential to the manufacturer.
54 If the Authority proposes to refuse an application, it must first give the applicant a written notice of what it proposes to do pursuant to s 8S(1)(a). That notice must include a draft statement of reasons for that proposed course of action (s 8S(2)(c)) and, by force of s 8S(2)(d), "set out the information on which the reasons are based" including information that the applicant had not provided to the Authority. In addition, the notice has to invite the applicant to make written submissions within 28 days or any longer period specified in the notice (s 8S(2)(e)), but the Authority is not required to take any such submission into account if it is not related to information that the applicant had already provided to it or that the Authority set out in the notice pursuant to s 8S(2)(d) (s 8S(3)). However, s 8X expressly proscribes the Authority and its officers from engaging, in the performance of functions or duties or the exercise of powers under ss 8S(2) and 162(1A), where to do so would disclose confidential commercial information the disclosure of which s 162 otherwise prohibits. In other words, s 8X has the effect of prohibiting any disclosure of confidential commercial information in a notice given under s 8S(2)(c) and (d).
55 If the Authority approved either application, it would not give Abbey any more information than s 8F requires, namely that it had registered the chemical product. Abbey would know from that simple fact that the Authority had determined that its product satisfied cl 1.2(3)(d). However, Abbey would have no information about what the Authority had found in respect of any of the variety of alternate bases within cl 1.2(3)(d) in arriving at its ultimate conclusion. For example, the Authority might have decided that Abbey's product's specifications and physico-chemical properties were neither the same nor equivalent to those of the reference product but still satisfied cl 1.2(3)(d)(ii). That is, the two products had minor but real differences but that those were not substantive. It follows that no confidential commercial, or other confidential information, about a reference product could possibly be communicated by a decision that found that apramax (or tetramax) was closely similar to Bayer's reference product in an assessment under item 6 and cl 1.2(3)(d).
56 Similarly, if the Authority refused either application, it would have to give a notice to Abbey in accordance with s 8G. Such a notice must state that the application has been refused and set out the reasons for the refusal as s 8G(2)(a) and (b) require. Unlike the position under s 162(11) (dealing with notices of approvals under ss 8H and 8J) or of suspensions under s 45A(1)(b) (that must be published) or those notices of approval dealt with in s 8X, nothing in the Code proscribed an officer of the Authority from setting out the reasons for refusal as required in s 8G(2)(b). Indeed, s 162(1A) expressly allows an officer to perform that function.
57 No doubt in setting out the reasons for a refusal under s 8G(2)(b), the Authority will be conscious of the need to preserve commercial confidentiality and will, and indeed must, choose the content of its statement of reasons carefully when doing so. Ordinarily, it would probably suffice to say, as a court would say in similar circumstances, that the proposed product was not closely similar to the reference product: see e.g. David Syme & Co Ltd v General Motors-Holden's Ltd [1984] 2 NSWLR 294 at 300G-301B per Street CJ, 308A-B per Hutley AP, 310G-311A per Samuels JA and Siam Polyethylene Co Ltd v Minister of State for Home Affairs (No 3) [2009] FCA 839 at [8]-[12] where I also discussed this. It may also be possible for the Authority to state one or more of the decisive or distinctive differences, such as that the active constituent did not have a particular feature, such as chemical composition, particle size, pH or crystal form that was closely similar to that of the reference product while also saying, that because of that or those, it was not necessary to consider the degree of similarity of other matters within cl 1.2(3)(d). A statement of fact in such a form would and need not reveal any detail or other information about the reference product (if that were confidential commercial information). That is because that form of revelation is sufficient to explain that, whatever the feature of the two products being compared is, the products are not closely similar by reason of the identified difference (e.g. the pH of each is, or is materially, different). It would not be necessary, particularly if the information were confidential commercial information, for the Authority to state the actual levels of pH or to describe the differences in crystal forms.
58 The definition of confidential commercial information in s 3 of the Code substantively reflects the way in which the general law classifies, as confidential, information in the nature of trade secrets and other commercially sensitive material. Ordinarily, administrative decision-makers can, and must, perform their statutory functions and at the same time afford procedural fairness conscious that they cannot reveal to third parties any matter the disclosure of which is protected or prohibited by the legal principles governing public interest immunity or confidential information.
59 The law in this respect was explained in Applicant VEAL of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs (2005) 225 CLR 88 at 97-100 [20]-[29]. There Gleeson CJ, Gummow, Kirby, Hayne and Heydon JJ held that, where a decision-maker has information that is adverse to the interests of a person who will be affected by an administrative decision, the decision-maker must draw the person's attention to it, but need not do so in a way that destroys or impairs any confidentiality in respect of the information. Their Honours held that where an Act regulated a decision-maker's task, the content of the obligation to accord procedural fairness had to be identified, having regard to the scope and objects of the Act as a whole.
60 They said that a decision-maker had to accommodate the public interest in protecting confidential material (in that case, the identity of an informer) with the obligation to afford procedural fairness to a visa applicant by disclosing what the substance of the adverse information was and asking for a response (225 CLR at 100 [29]). They said that "[t]he application of principles of procedural fairness in a particular case must always be moulded to the particular circumstances of that case" (225 CLR at 99 [25]), citing Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Lam (2003) 214 CLR 1 at 13-14 [37] per Gleeson CJ, 16 [48] per McHugh and Gummow JJ (see too Assistant Commissioner Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 98 [152] per Hayne, Crennan, Kiefel and Bell JJ; Eastman v Director of Public Prosecutions (No 2) (2014) 9 ACTLR 178 at 231-232 [165]-169] per Rares and Wigney JJ and Cowdroy AJ; Minister for Immigration and Citizenship v Maman (2012) 286 ALR 680 at 691-692 [37]-[38] per Flick and Foster JJ and the cases there cited, 703-704 [91]-[92] per Katzmann J). Indeed as Gleeson CJ said in Lam 214 CLR at 14 [37]:
Fairness is not an abstract concept. It is essentially practical. Whether one talks in terms of procedural fairness or natural justice, the concern of the law is to avoid practical injustice. (emphasis added)
61 Here, the Code required the Authority not to disclose confidential commercial information in the course of conveying to an applicant adverse information under s 8S(2)(d). The Authority had to mould its procedures so as to comply with its obligations to set out information in a notice under s 8S(2)(d) in a way that did not disclose directly or indirectly matter that s 162(1) prohibited being disclosed. However, the Authority never engaged in its function to assess the two applications. Instead, it decided to re-categorise them before it ever reached the point where it concluded that it could not discharge any obligation under s 8S(2)(d) that might arise, were it to propose refusing either application.
62 Indeed, as I have explained, had the Authority decided to approve the applications, the shadow at which it boxed prospectively would never have appeared. Nor would the Authority or decision-maker know what, if any, confidential commercial information could possibly be relevant under s 8S(2)(d) (and whether a breach of s 162(1) would then be inevitable as opposed to avoidable as VEAL 225 CLR 88 contemplated) until it performed its statutory task of considering the applications as submitted.
63 The Code expressly contemplated that the Authority would have to adopt procedures that moulded the requirement to inform an applicant under s 8S(2)(c) and (d) with the requirement under s 162(1) to protect from disclosure information that was commercially confidential. As Mason J, with whom Murphy, Aickin, Wilson and Brennan JJ agreed, said in O'Brien v Komesaroff (1982) 150 CLR 310 at 326-327:
… the accepted conception of confidentiality … involves the person seeking to protect the information largely keeping it to himself …
To simply say that the information is as to the effect and practical operation of discretionary trusts and private unit trust schemes does not identify the information and enable the Court to formulate an order. One needs to know not only what was the information conveyed but also what part of that information was not common knowledge. (emphasis added)
64 Ordinarily, once confidential information or a secret is released into the public domain, the quality of confidentiality is lost once for all: cf Attorney-General v Leveller Magazine Ltd [1979] AC 440; John Fairfax & Sons Ltd v Police Tribunal of New South Wales (1986) 5 NSWLR 465 at 480C-D per McHugh JA. There are four elements to a claim in equity to protect confidential information. These were identified by Finn, Sundberg and Jacobson JJ in Optus Networks Pty Ltd v Telstra Corporation Ltd (2010) 265 ALR 281 at 290 [39] (and see too Meagher Gummow and Lehane's: Equity Doctrines and Remedies (5th ed) at [42-100]) as:
(1) the information in question must be identified with specificity;
(2) it must have the necessary quality of confidence [i.e. confidentiality];
(3) it must have been received by the person to whom it was provided in circumstances importing an obligation of confidence; and
(4) there must be an actual or threatened misuse of the information without the authority of the provider.
65 Obviously, s 162(1) supplants element (4), that Finn, Sundberg and Jacobson JJ identified, in prohibiting disclosure, but unless and until the Authority actually gets to the point of identifying some particular piece of information that Bayer provided years ago that still retains the quality of confidentiality, and that must be disclosed under s 8S(2)(d), s 162(1) can have no application to the facts.
66 Not everything that Bayer provided to the Authority in respect of the reference products was necessarily confidential commercial information either at the time of its provision over 10 years before, or remains so today: see Maggbury Pty Ltd v Hafele Australia Pty Ltd (2001) 210 CLR 181 at 202 [54] per Gleeson CJ, Gummow and Hayne JJ. Until the Authority considers what Bayer had provided in assessing whether the reference and proposed products satisfy the criterion in cl 1.2(3)(d), it cannot know what, if anything, in the information that Bayer had supplied, s 162(1) might prohibit disclosure of under s 8S(2)(c) or (d), if the Authority were to propose refusing either application. Moreover, at that point, when the particular information would be isolated, the Authority would have to attempt to mould its procedure to comply with the Code as a whole by both protecting any confidential commercial information but at the same time obeying the requirement in s 8S(2)(d). Only in the unusual situation, where a breach of s 162(1) would be inevitable, having regard to the principles in VEAL 225 CLR 88, would the Authority be required to consider re-categorising the applications in order to avoid what would be a demonstrable and otherwise unavoidable contravention of s 162(1).
67 The Authority has the function of determining whether or not it is satisfied about the matters in s 14 of the Code based on an application, initially at least, in the form as made to it (i.e. as s 14(1)(a) says it must be satisfied "that the application meets the application requirements"). The Authority specified in the Instrument certain matters that had to be included in an application pursuant to s 8B(1). The application had to be in writing on the approved form pursuant to s 8A(a)(i), that being, as defined in s 3, a form approved by the Authority or prescribed by the Regulations. No such form has been prescribed. However, the form Abbey used was drafted by the Authority for item 6.
68 Because the Authority gave Abbey a notice of preliminary assessment under s 11(2) that each application met the application requirements specified in s 8A, it follows that each application had been made, and fell to be considered, in accordance with item 6 in Pt 2 of Sch 6 of the Regulations.
69 As the reasons of each decision-maker noted, that consideration entailed the consideration of whether the proposed chemical product was "closely similar" to the reference product within the meaning of cl 1.2(3)(d) and item 6(a) of Sch 6. Each decision-maker identified that the only difficulty in considering whether each proposed chemical product was closely similar to the reference product arose in making a finding under cl 1.2(3)(d). Neither decision-maker stated that he or she had had access to, or considered, the Authority's file in respect of the reference product.
70 Accordingly, neither decision-maker could have formed any view, let alone have known, that any information on such a file necessary to undertake the comparison required by cl 1.2(3)(d) was, first, confidential over 10 years after it had been provided by Bayer to the Authority and when both reference products had been, and aprapharm still was, on the market for many years and, so, available for testing by any member of the public. Secondly, neither decision-maker considered whether it was possible to decide whether to register or refuse to register each proposed chemical product and to give a notice, including if he or she proposed to refuse registration, in such a way as would accommodate the need to preserve any subsisting confidentiality of any particular information in accordance with s 162(1) and the statutory duty to give notices under s 8F(2), s 8G(2) or s 8S(2)(c) and (d).
71 Instead of performing those necessary functions for the purpose of making a decision on each of Abbey's applications that had passed preliminary assessment under s 11(2), each decision-maker concluded that because it would be necessary merely to refer to unspecified confidential commercial information, a decision on each application necessarily would result in direct or indirect disclosure of some confidential information.
72 That conclusion involved a failure of the decision-maker, first, to perform the function of deciding each application under s 14 of the Code and, secondly, to take into account a relevant consideration - namely the need to examine the relevant information on the reference product files so as to ascertain what, if anything, might be confidential and then considering whether it was possible to proceed as VEAL 225 CLR at 99-100 [29] had explained.
73 For the reasons I have given, no disclosure of any confidential information could possibly occur if the Authority approved either application. That is because the bare statement that Abbey's product would be registered could not convey on which of several bases under either limb of cl 1.2(3)(d) the decision-maker had determined that either of the two products was closely similar to the reference product. Moreover, the Register had recorded the active constituent of each reference product, as had their approved labels, for over a decade. That fact and the reference products themselves were in the public domain and had no element of confidentiality about them. And, if the decision-maker were to propose to refuse registration, he or she would need to give close, actual, consideration to how to perform the functions in s 8S(2)(c) and (d) without disclosure of anything that might be confidential: VEAL 225 CLR at 100 [29]. As I have explained, ordinarily it will be possible for the decision-maker to identify which one or more of the specifications or physico-chemical properties nominated in cl 1.2(3)(d) was not the same or equivalent and then to determine whether any such difference actually was confidential commercial information or was readily ascertainable by anyone examining the reference product. After that process, ordinarily the decision-maker will be able, if proposing to refuse or refusing an application to give reasons that state, as his or her finding of fact, merely that the relevant specifications or properties of the two products are not closely similar.
74 The application requirements that Abbey had to meet, for the purposes of s 14(1)(a), under item 6 of Pt 2 of Sch 6, were those set for an approved active constituent. Relevantly, the active constituents of both apramax and tetramax had been approved already. The decision-maker asserted in [24] and [25] of her apramax reasons that she needed to access Bayer's confidential commercial information to determine whether the efficacy of aprapharm was closely similar to that of apramax. Yet, item 6(b) provided that efficacy and safety data were "not required to demonstrate the similarity of" apramax to the reference product. Instead, item 6(a) set out the criterion of the two products being closely similar as defined in cl 1.2(3) of Pt 2 of Sch 6.
75 That required relevantly that, first, the active constituents were the same as here (cl 1.2(3)(a)), secondly, the concentration of those constituents were the same (cl 1.2(3)(b)), which the decision-makers accepted, along with the matters in cl 1.2(3)(e)-(g), could be established on publicly available material, while cl 1.2(3)(c) was not relevant (see [24] of the apramax decision), and, thirdly, that the proposed and reference products' specifications and physico-chemical properties were either the same or equivalent or, if not, the differences were minor and not expected to have adverse implications for product quality or biological activity in terms of efficacy, safety or residues (cl 1.2(3)(d)). Item 6(c) no doubt required the applicant to provide chemistry and manufacture data so that the Authority could assess the issues under cl 1.2(3)(d).
76 The decision-maker said (at [21] of the apramax decision), to her knowledge, that information concerning the specifications, composition and manufacturing process of the active constituent for the reference product were not in the public domain and that those factors related to the quality of the active constituent and affected its stability. If Abbey's product had a material difference in its specifications, composition or manufacturing process from those of the reference product, and that difference affected either the quality of the active constituent or stability of Abbey's product, all the decision-maker would need to disclose is the bare fact that there was the particular material difference in that general subject matter. Such a general disclosure (e.g. the specifications of the two products are not closely similar) could not convey any confidential information, let alone confidential commercial information.
77 Abbey provided a data package with each application that, among other matters, gave the results of a stability study in storage conditions of identified temperatures and relative humidities for the respective products in support of a requested shelf life. The Register recorded the approved labels for each reference product that also had specific storage and dosage strength information. The Register recorded that Aprapharm should be stored below 30ºC room temperature in a dry place and that 1.68g of aprapharm soluble powder equalled approximately "1g Apramycin activity". The reference products either had or did not have closely similar stability to those in Abbey's two applications. A statement of the Authority's conclusion on that comparison would not reveal anything confidential to Bayer. That is because, if the two were closely similar, Bayer could only sell its products with the relevant stability data reflected in its storage conditions and use by date on the reference product's label that Abbey's product would also need to display on its label. And if the two were not closely similar in a particular respect, that finding of fact, ordinarily, would be a sufficient statement of the decision-maker's reason for refusing, or proposing to refuse, the application.
78 Similarly, the level of potency or efficacy of a reference product as against the relevant product would either be, or not be, closely similar. That potency or efficacy could be ascertained by anyone testing the publicly available reference products. Disclosure of the fact that the actual degree of similarity was or was not "closely similar" would reveal nothing confidential to Bayer. The fact of a relevant difference, ordinarily, would be the information on which the reasons were based (within the meaning of s 8S(2)(c) and (d) of the Code). It would not be necessary for the decision-maker to identify the precise information in the Authority's file about the reference product's relevantly different specification or physico-chemical property. If an applicant wished to challenge those reasons, s 162(2) contemplates that the Authority's file in respect of the reference product will be available for use in court proceedings in which appropriate orders can be made to protect anything that is confidential commercial information.
79 For example, the pH of a product that has been or is on the market would be likely to be readily ascertainable and have no quality of confidentiality. Just because the maker of a reference product may provide a pH value when it applied to obtain registration or approval of its product, did not entail that that pH value was confidential. A person, such as Abbey, could buy and test the reference product to ascertain its pH and identify that its value was the same or closely similar to the generic product the subject of its application. On the other hand, it may be that ascertaining differences, if any, in, say crystal form of the reference product, could give rise to an issue as to confidentiality. However, if it did, the decision-maker would be entitled to state that there were such differences in crystal form, so that the two products were neither the same nor equivalent. Such a statement would not reveal any secret or confidence about the crystal form of the reference product; it would reveal only that that form was substantively different from that of Abbey's product and, hence, no contravention of s 162(1) would occur in such a statement.
80 This example demonstrates how the Authority did not exercise its jurisdiction and failed to ask itself the correct question or to consider a relevant consideration - namely that, if it actually needed to deal with a proposed refusal, whether it was still possible to disclose the matters required by s 8S(2)(c) and (d) conformably with s 162(1). Likewise, if the decision-maker was not satisfied that the differences referred to in cl 1.2(3)(d)(ii) were minor and or not expected to have the adverse implications specified, a statement of reasons, or information on which those reasons were based, would focus on the defects in Abbey's products and would not be likely to involve any disclosure of Bayer's confidential commercial information. The publication of the refusal would reveal only that whatever the respects in which there was a difference between the products, Abbey's product possessed or failed to possess a publicly unstated particular specification or property, that disqualified it from being registrable on the basis of Abbey's assertion that it was "closely similar" to the reference product.
81 It follows that the Authority failed to make a decision under s 14 of the Code and made a jurisdictional error by constructively failing to exercise its jurisdiction to decide Abbey's two item 6 applications. Abbey is entitled to an order in the nature of a writ of mandamus under s 39B(1A)(c) of the Judiciary Act and s 23 of the Federal Court of Australia Act 1976 (Cth) compelling the Authority to determine each application according to law.