contribution

Contribution from Simon Carne

A response to the BCLWG Provisional Conclusions and Recommendations from Simon Carne.

May 23, 2017
Alex Baker

I attended the BCLWG event at BIICL on 2 May and would like to follow up with brief comments on a couple of issues that were addressed during that discussion. My comments relate to the proposals in paragraphs 2.7 and 2.16-17 of the BCLWG’s Provision Conclusions and Recommendations, published in April. The proposals in those paragraphs centre around giving some form of recognition in UK law to EU-related decisions.

Overview

Whilst I can see the merits in the proposals from a legal point of view (and, to a limited extent, from a practical point of view), I think the proposals are almost certain to fail in their current form. The Brexit process is, I suggest, being conducted by government with a starting presumption that, post-Brexit, the EU will be treated by the UK as no different from any other foreign country or foreign institution and the ECJ will have the status of a foreign court. This is a rebuttable presumption, but it would take a powerful argument to achieve the rebuttal – much more powerful than (i) the “inefficient and unnecessary” assertion in the working group’s paragraph 2.17 and/or (ii) the aim of delaying the “likelihood of sharp divergences” between UK and EU jurisprudence so that it occurs only in the medium to long term, but not the short term, in the working group’s paragraph 2.7.

I think there are alternatives that will be more attractive to the government and I invite the BCLWG to consider them.

Article 101 and 102 infringements

Paragraph 2.16 recommends that claimants in UK courts should be able to rely on the findings of the EC as binding in relation to infringements of articles 101 and 102. Paragraph 2.17 identifies that the alternative is for claimants to bring actions for breach of a foreign tort, but it argues that this would be “inefficient and unnecessary”, because “expert evidence would [usually] be required in order to prove the content of the foreign law as a matter of fact”.

 

Since foreign law would be “a matter of fact” and, “given the effectively identical nature of the EU and UK competition rules and the familiarity of the UK courts with them”, it would be open to the parties in any UK litigation to agree those facts and invite the court to try the case on that basis. An item could be added to the Civil Procedure Rules to address the transition of Article 101 and 102 jurisprudence from UK law to foreign law by requiring the parties to attempt to agree the foreign law (as a matter of fact) and, where they cannot achieve agreement, proceed as follows:

a)   Where both parties to the action agree that expert evidence is required in order for the court to determine the relevant EU law, such evidence would be permissible. There would (on this hypothesis) be no loss of practicality or efficiency, since the hypothesis indicates that, even if the EU decision had been treated as binding, the parties would be in disagreement over the application of the decision to their case in the UK courts.

b)   Where one party argues that expert evidence is required and the other party considers it unnecessary, an order of the court would be required before calling expert evidence. As a further disincentive to seeking such orders, the court could have the power to determine that the award of costs relating to the experts could follow the outcome of the issue on which expert evidence was adduced, rather than the outcome of the overall case.

Having regard to EU jurisprudence

Paragraph 2.7 proposes that the UK courts should be required to “have regard to” European competition jurisprudence. There is a precedent for this in the Human Rights Act 1998. It has, however, proved controversial, with differing views as to what precisely is the meaning of the duty.

I believe the point was made at the 2 May event that permission to have regard to EU jurisprudence does not need to be written into legislation, since the UK courts are free to do that in any event. A “duty” to have regard, as proposed by the BCLWG, must therefore amount to a requirement to have regard even in cases where the court would not otherwise consider it appropriate to do so. This runs contrary to the Brexit concept of “taking back control”.

The intended meaning is all the more confusing given that, on the basis of paragraph 2.7, the stated aim is to permit divergence between the EU and UK jurisprudence, but not in the short term. When would it be acceptable for a UK court to diverge for the first time? With all due respect to to the BCLWG lawyers, it seems to me that their argument lacks logic. I invite them to consider the following simple thought experiment.

Consider the question: Is it the intention that the first case to diverge should have a different outcome from a (hypothetical) case with identical facts heard at an earlier date?

–  If that it is the intention, what would be the legal rationale for the court making the change? How would this approach achieve the reduction in uncertainty which the BCLWG gives as its reason for the proposal. Is it not the case that this approach merely postpones the uncertainty from 2019 to an unknown date, making it more difficult, not less, for an aggrieved party to know, after 2019, whether to bring a case or for the defendant to know whether to defend it?

–   If it is not the BCLWG’s intention that the first case to diverge should have a different outcome from a (hypothetical) case with identical facts heard at an earlier date, it must follow that the timing of the first divergence will be determined by the timing of the case which causes the court to diverge, not by some notion of short term vs medium (or long) term. So the departure could be in the short term after all. What, then, is the reason for the proposal?

I invite the BCLWG to conclude that Brexit will mean that UK jurisprudence is liable to depart from the EU’s as and when judges sitting in the UK court deem it appropriate to make that departure (or, if sooner, when Parliament legislates for a departure). If there is some reason to suppose, or to fear, that the UK’s current judges would be minded to diverge from EU jurisprudence quickly and sharply, leading to uncertainty, the best solution would be through the manner in which the UK’s competition bench is assembled, rather than through the legal minefield of a “having regard to” clause.

www.simoncarne.com