On 20th July 2015, it was reported in the High Court how Telefonica, the owner of O2 and the UK telecoms giant, had been hit by an interim injunction by a small business (Packet Media Limited) who believed that Telefonica were abusing their position of dominance in the wholesale provision of access to call and SMS text origination. The case is important in showing the growth of competition litigation in the UK, and the protection it affords small businesses who feel threatened by the anti-competitive behaviour of much larger companies.
The case concerned O2 withdrawing their support for effectively Packet Media’s business. Packet Media relied on O2 providing and supporting their SIM cards which they in turn provided to customers to allow them a low cost GSM gateway for calls and text messages. In response to this threatened suspension, Packet Media sought an interim injunction against the suspension at the High Court and was successfully granted one on the basis that Telefonica had a case to answer for a possible abuse of dominance, in breach of Article II of the Competition Act 1998.
What makes the case more remarkable is the fact that it constitutes what is known as a ‘stand-alone’ case, as Telefonica have not been found guilty in any larger case, Packet Media must prove fault if they are to succeed in obtaining a permanent injunction against any withdrawal of service. The case was made more possible for Packet Media as a result of the Enterprise and Regulatory Reform Act 2013 which aimed to make competition law access easier for smaller UK businesses. In this particular case, it lowered the standard of proof necessary for the granting of an interim injunction from “significant damage” in section 35 of the Competition Act 1998 to “serious, irreparable harm”.