Historically, competition law has been a matter for public enforcement, with those who infringe it subject to penalty from regulators. However, there is an increasing impetus towards so-called "private enforcement" where the victims of anticompetitive behaviour sue for damages. In this regard, three developments are of particular interest:
- the introduction of follow-on actions;
- recent reform of the UK damages regime; and
- current proposals to reform the European damages regime
The right to sue for damages for competition law infringement was established in the landmark claim of publican Bernie Crehan against Courage and Inntrepreneur, in which our head of Competition Law, Stephen Critchley represented Mr Crehan. However, it did not lead to a rush of claims, partly because of the difficulty in proving anticompetitive behaviour. The Crehan case, for instance, ran from 1994 to 2006.
To remove this difficulty in cases where the anticompetitive behaviour has already been established in a finding by a UK regulator or the European Commission, s18 and s20 of the Enterprise Act 2002 introduced "follow-on" or "piggyback" claims in which such decisions are binding, so those who believe they had suffered as a result can sue - either before the Courts or the Competition Appeals Tribunal (the "CAT") - and, in that action, the infringement is taken as given, so the proceedings can move straight to the questions of:
- whether the behaviour caused loss to the claimant; and
- if so, how much.
Consequently, any undertaking that believes it has been adversely affected by anticompetitive behaviour established by such a decision should consider whether the loss may be large enough to merit a claim.
Click here for a list of notable infringement decisions.
Despite the comparative ease of follow-on actions, it is still not realistic to expect such actions by large numbers of purchasers, each of whom have suffered small losses, so the Enterprise Act also included provision for so-called "super-complainants" like the consumer body Which? to bring follow-on actions on their behalf.
Additionally, the Consumer Rights Act 2015 has introduced collective actions in which, for example, a single purchaser can act as a representative bringing a claim on behalf of an entire class. Click here for details of this recent reform of the UK damages regime or here to return to our Guidance on Actions for Damages.