First steps along the competition law fast track?
'Speed racing' by Chris Peeters CC0 via Pexels
Among the reforms brought about by the Consumer Rights Act 2015 was the introduction of a so-called “fast-track” procedure for claims in the Competition Appeal Tribunal (CAT). The intention was to enable simpler cases to be resolved more quickly and cheaply, “empower[ing] SMEs to challenge anti-competitive behaviour that is restricting their ability to grow” (see the Government’s response to its consultation on options for reform of the private litigation landscape).
The CAT Rules set out the factors that it will take into account in deciding whether to allow the “fast-track” procedure to be used: the size of the parties concerned, the estimated length of the hearing ( no more than three days), the complexity of the issues, the scale of evidence and disclosure required, and the remedies sought (rule 58(3)). Where the procedure is available, recoverable costs will be capped on a case-by-case basis (rule 58(2)(b)); and, where an interim injunction is applied for, the CAT can dispense with the (often onerous) requirement that the applicant should provide a cross-undertaking in damages (rule 68(5)).
The fast-track regime entered into force on 1 October 2015. Since then, fast-track status has been requested in two cases.
The first was just before Christmas, in a case brought by NCRQ Ltd against the Institution of Occupational Safety and Health. The claimant was a provider of training in health and safety. It claimed that the Institution it had abused a dominant position on the market for the accreditation of qualifications in the health and safety sector in refusing to accredit the Claimant’s diploma. The Claimant also sought an interim injunction, which the CAT directed be heard on 12 January 2016. In the event, the case settled just before the injunction application was due to be heard.
The second case was a claim brought in February 2016 by two property developers against Tesco. The claimants’ case was that an agreement by which they sold land to Tesco in 1997 was an anti-competitive agreement in breach of the Chapter I prohibition; they also contended that the covenant protected a dominant position enjoyed by Tesco on the relevant market. It appears from press reports that the claimants wished to develop land adjacent to the land sold to Tesco, for the benefit of a discount store, but were unable to do so by virtue of restrictive covenants to which they agreed nearly 20 years ago. A CMC in the proceedings was listed for 21 March 2016, but by order dated 17 March 2016 the President of the CAT formalised the withdrawal of the claim following a settlement between the parties under which Tesco apparently released the claimants from the restrictive covenant.
It is unclear whether the claimants’ request for fast-track-designation will be determined at this CMC.
It is far too early to assess whether the new fast-track regime will achieve its laudable aims of improving access to the courts for victims of anti-competitive conduct. The fact that there have only been two requests for designation in the first five months might be seen as disappointing, but it should not come as a surprise: competition litigation is often complex and raises difficult strategic issues, and potential litigants are likely to tread warily at least until the CAT has fleshed out the principles and given further guidance on matters such as cost-capping and the need for a cross-undertaking in interim injunction cases. Once that has happened, we might expect to see more cases – particularly if the CAT’s approach is perceived to be SME-friendly. Watch this space.
July 4, 2016
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