(CN) – German authorities took privacy concerns too far in refusing to let the victim of a Ponzi scheme access official financial records, the European Court of Justice ruled Tuesday.
Ewald Baumeister submitted the records request at issue after he lost a sum that he had invested in Phoenix Kapitaldienst, which has been in judicial liquidation after insolvency led to its dissolution in 2005.
After the Federal Financial Supervisory Authority shot him down, Baumeister filed suit in Germany’s Federal Administrative Court.
This body in turn asked the European Court of Justice to clarify whether EU law precludes national authorities from disclosing confidential information that they receive.
On Tuesday, the court ruled that the confidentiality of such information is not unconditional.
“Further, the court’s case-law indicates that where information that could constitute business secrets at a certain moment in time is at least five years old, that information must, as a rule, on account of the passage of time, be considered historical and therefore as having lost its secret or confidential nature unless, exceptionally, the party relying on that nature shows that, despite its age, that information still constitutes an essential element of its commercial position or that of interested third parties,” the ruling out of Luxembourg states.
Rather than ruling for Baumeister outright, Tuesday’s ruling merely invites the German court to determine whether the records he seeks are covered by the obligation of professional secrecy.