In three recent cases, the UK Court of Appeal has further extended the ability of the English Courts to hear claims for competition damages in the EU.
WH Newson Holding Ltf & Ors v IMI plc & Ors, concerned follow-on damages following the finding of an infringement in a copper tubes cartel. The importance of the case is the fact that the concept of what constitute competition claims is not well established in law and is a category in flux. In this case the claimants attempted to plead their case on the basis of conspiracy by the defendants, on top of other claims, as conspiracy carries a potentially higher level of damages for the claimant.
Although the Court rejected the conspiracy claim on the grounds that the claim in question did not satisfy a follow-on claim for which they had jurisdiction, the Court opened the possibility of future conspiracy claims being heard by the Competition Appeals Tribunal (the “CAT”). Under the UK Government’s competition reforms, the CAT will be likely be able to hear such cases by the end of next year when restrictions on the CAT hearing only follow-on damages cases are lifted.
Deutsche Bahn AG & Ors v Morgan Crucible Company plc & Ors concerned claims for damages following the EU Commission’s finding of a cartel in carbon and graphite products. The UK Court of Appeal upheld a claim by the claimants that English purchasers of the goods in question could sue in England on the grounds that the harm arose in England, even when none of the defendants were UK domiciled and the goods were purchased from non-UK sources.
The UK Court of Appeal held that since the harm occurred in England, Article 5(3) of the Brussels Regulation could be used in exception to the standard rule that claims should be heard in the defendant’s home jurisdiction.
Also of note is the fact that the claimants had failed to get UK jurisdiction originally as they sued a UK domiciled defendant but the two year limitation of the CAT for claims prevented them from being able to do so. With reference to the UK impending competition litigation reforms the limitation period for bringing claims in the CAT will be lengthened to 6 years to harmonise it with the High Court. The extended time limitation period should therefore save cases like the above that have previously been defeated as time barred.
In Ryanair Ltd v Esso Italian Srl, Ryanair argued that a clause which gave exclusive jurisdiction to English courts in a contract could also be extended to any similar breach of statutory tortious duty, in this case, a claim for damages due to Esso Italian’s participation in a jet fuel price fixing cartel. The UK Court of Appeal held that the contractual claim could not be extended to cover a breach of Article 101 of the TFEU, an EU prohibition on anti-competitive agreements.
The case actually widens the scope of the English courts to hear future competition claims as the Court rejected the idea of one-stop-shop litigation, meaning that just because there was an exclusive jurisdiction clause for one type of harm, that did not mean all types of claims were then bound for it.
Therefore for example, it is perfectly possible to envisage a contract which has exclusive contractual jurisdiction in Germany being heard in the UK on separate non-contractual grounds of breach of competition law. However, the splitting of such claims can still be avoided in the future by savvy contractual drafters who include competition claims and damages within their exclusive jurisdiction contractual clauses, subject of course to the operation of the Brussels Convention.