Mr Ewald Baumeister is one of the investors who suffered loss due to the activities of the German company Phoenix Kapitaldienst, whose business model took the form of a Ponzi scheme. Insolvency proceedings having been initiated against Phoenix in the course of 2005 that company has been dissolved and is now in judicial liquidation. Mr Baumeister submitted to the Federal Financial Supervisory Authority, German a request for access to certain documents concerning Phoenix, as part of its supervision of Phoenix. Since the Bundesanstalt refused to grant him access to those documents, Mr Baumeister brought proceedings before the German courts.

The Federal Administrative Court, Germany against that background asks the Court of Justice to clarify the scope of the directive on markets in financial instruments, which provides that the competent authorities are subject to an obligation of professional secrecy and may not, other than in the situations exhaustively listed in the directive, disclose confidential information that they have received. In the judgment issued on June 19, 2018 the Court holds, first, that all information relating to the supervised

undertaking and communicated by it to the competent authority, and all statements of that authority in its supervision file, including its correspondence with other bodies, does not constitute, unconditionally, confidential information that is covered, consequently, by the obligation to maintain professional secrecy. Information held by the competent authorities (i) which is not public and (ii) the disclosure of which is likely to affect adversely the interests of the natural or legal person who provided that information or of third parties, or the proper functioning of the system for monitoring the activities of investment firms established by the directive must be so classified.

The Court then adds that information that could constitute business secrets loses, generally, its secret nature when it is at least five years old. Exceptionally, that may not be the case where party relying on its secrecy shows that, despite its age, that information still constitutes an essential element of its commercial position or that of interested third parties. The Court observes however that such considerations have no bearing in relation to information the confidentiality of which might be justified for reasons other than the importance of that information with respect to the commercial position of the undertakings concerned, such as information relating to prudential supervision methodology and strategy. Last, the Court further states that the Member States remain free to decide to extend the protection against disclosure to the entire contents of the supervision files of the competent authorities or, conversely, to permit access to information that is in the possession of the competent authorities which is not confidential information within the meaning of the directive.