Case Summary and Outcome

The Federal High Court, sitting in Lagos, Nigeria, held that the Nigerian Stock Exchange was a “public institution” under Nigeria’s freedom of information law and ordered the Stock Exchange to provide its inspection report into a company accused of committing fraud. A Nigerian investor, Ayibatonye Owei, sought access to documents from the Nigerian Stock Exchange which would provide information on the investment companies which had defrauded him. The Stock Exchange denied his request, arguing that as it did not receive public funds it was not a “public institution” and so did not have obligations under the Freedom of Information Act, 2011. The Federal High Court held that the Freedom of Information Act could apply to any private company providing public services or performing public functions – irrespective of whether the company received public funds. The Federal High Court concluded that the information sought by Mr. Owei was of public interest and should be disclosed. Accordingly, the Federal High Court declared that the Stock Exchange was subject to the Freedom of Information Act and ordered that it provide Mr. Owei with the report he sought within seven days.

Facts

The former Commissioner of Health of Bayelsa State, Ayibatonye Owei, and his four children sought reports from the Nigerian Stock Exchange regarding inspections carried out by the Stock Exchange on two investment companies (Partnership Securities and Partnership Investment Company) that had allegedly been involved in “massive capital market fraud”. [pg. 2] Mr. Owei also sought documents/records showing the securities/shares that were in the portfolio owned by the two companies. Mr. Owei had been one of many Nigerians whose investments had been negatively affected by the fraud. [pg. 13]

The Stock Exchange refused to provide any information, arguing that it did not fall under the scope of Nigeria’s Freedom of Information Act, 2011. Mr. Owei then approached the Federal High Court, sitting in Lagos, seeking a declaration that the Nigerian Stock Exchange constituted a “public institution within the meaning and intendment of the Freedom of Information Act 2011”. He also sought an order directing the Stock Exchange to provide Mr. Owei with any inspection reports into the two companies. [pg. 1-2] During the processings, the Stock Exchange released the first set of information, regarding a targeted inspection, that Mr. Owei was denied access to.

Decision Overview

Faji J delivered the judgment of the Federal High Court, sitting in Lagos (Court). The Court had to determine whether the Nigerian Stock Exchange was a “public institution” under section 2(7) of the Freedom of Information Act (Act) and, if so, whether it should order the production of the reports sought by Mr. Owei. Section 2(7) of the Act stated that “[p]ublic institutions are all authorities whether executive, legislative or judicial agencies, ministries, and extra-ministerial departments of the government, together with all corporations established by law and all companies in which government has a controlling interest, and private companies utilizing public funds, providing public services or performing public functions”. [pg. 15]

Mr. Owei argued that the Nigerian Stock Exchange must be understood as a “public institution” because it “provides regulatory services in the nature of public service or a public function”. [pg. 2] He submitted that the Act “has the intendment of ensuring that members of the public have access to information that is of sufficient public interest … regardless of the nature of the persons in custody of the information”. [pg. 3] The Stock Exchange argued that the purpose of the Act should be determined with reference only to the ordinary meaning of its provisions, and said that the legislation’s definition of “public institution” when referring to private entities limited the application of the Act to private companies receiving public funds and that were providing public services or public functions. [pg. 6]  The Stock Exchange argued that, as it did not use public funds, it could not be a “public institution”. In the alternative, the Stock Exchange argued that if it was deemed to be a “public institution” it was not at liberty to provide the information sought by Mr. Owei because that information contained personal information.

In response to the Stock Exchange’s arguments, Mr. Owei submitted that the Act must be interpreted literally. He asserted that it was possible for a private company to perform a public function using its own funds, and the Act would apply to private companies that “may not have received public funds but have been tasked, by contract, statute or other legal means with the obligation to perform a public function or service”. [pg. 10] In addition, Mr. Owei argued that the public interest outweighed the need to protect the personal information contained in the reports to which he sought access and that there was no personal information in the reports that had not already been disclosed.

Faji J held that the correct interpretation of section 2(7) of the Act was that a “public institution” was defined as either (i) a private company utilizing public funds, (ii) a private company providing public services, or (iii)a private company performing public functions. Consequently, the fact that the Stock Exchange did not receive public funds was irrelevant so long as it was determined to be providing public services or performing public functions. Faji J held that the Stock Exchange was “established to carry out its activities in the interest of investors and the public” and that, on a “literal interpretation” of the Act, the Stock Exchange was “a public institution and therefore subject to the Freedom of Information Act”. [pg. 18]

Faji J noted that one of the companies, Partnership Investment Company, was not a dealing member of the Stock Exchange. He concluded that, since the Stock Exchange was not in possession of information about that company, it could not produce what it did not have. He also found that there was no proof provided by Mr. Owei that the requested documents/records showing securities/shares currently in the two companies’ portfolios was in the custody of the Stock Exchange. As a result, that request was refused. It was left to consider whether the reports from the inspection of Partnership Securities should be disclosed to Mr. Owei.

Faji J examined the Stock Exchange’s argument that it was permitted to refuse access to the information on the grounds that it contained personal information. He concluded that the information did not constitute “personal” information as defined in the Act. Faji J reasoned that “[d]isclosure will protect the interest of the general public” and that “it is in the public interest to disclose the affairs of an entity that has done business with the public and is alleged to have acted against the interests of the public”. [pg. 25] In any event, the Court noted that the information was released to the public and “it is not clear why it has been suggested that producing it would affect the privacy of Partnership Securities’ clients. The Court also rejected any arguments on the basis that the information was related to a trade secret or was confidential and could cause harm to third parties if released. Faji J went on to say “I actually think that disclosure of the information will protect not only third parties (i.e. clients of [Partnership Securities] but also other people who are not aware of the steps taken with respect to [Partnership Securities] by the [Stock Exchange] and Securities and Exchange Commission. Disclosure will protect the interest of the general public.” [pg. 25]

Faji J ordered that the Stock Exchange provide the documents sought by Mr. Owei that it had in its possession within seven days.