In BCL Old Co Limited and others v BASF, the Court of Appeal has held that an appeal against a penalty (as opposed to an appeal against the finding of infringement) does not postpone the date from which the two year time limit for bringing a follow-on damages claim runs. The Court of Appeal reversed a decision of the Competition Appeal Tribunal (the CAT) which had rejected BASF's argument that a claim for damages brought by BCL Old Co Limited and others was time-barred.


The judgment in this case is also relevant to a number of other damages claims against some of the other participants in the vitamins cartel for which the action had been stayed until the Court of Appeal's judgment was handed down. It provides some clarification of the statutory provisions relating to follow-on damages, but there will inevitably be some grey area cases where it is not entirely clear as to whether an appeal relates solely to the penalty or whether there is also an impact on the infringement finding. Future claimants will have to assess carefully the nature of an appeal in respect of a decision on which they are basing their damages claim, in order to assess whether or not it is an appeal that would have an effect on the time limit. There may also be practical difficulties for claimants in getting access to the details of an appeal.

Under Rule 19 of the CAT rules, as part of its general case management powers, the CAT has the power to extend the deadline for bringing a damages claim even after the statutory time limit has expired and it remains to be seen whether (and if so, on what basis) the CAT will be prepared in this case to use these powers in order to allow the claims to proceed.


The case arose from the Commission's vitamins cartel decision adopted in November 2001, in which it found that BASF and a number of other undertakings were guilty of fixing prices for different vitamin products and allocating sales quota. BASF appealed against the decision in relation to the fine, and on 15 March 2006 the CFI reduced the fine imposed on BASF.

On 13 March 2008, BCL Old and others brought a follow-on claim for damages under section 47A of the Competition Act 1998, relying on the Commission decision and alleging that they had suffered a loss and damage as a result of the infringement of Article 81 (1) by BASF. Section 47A allows a person who has suffered loss or damages as a result of a breach of EC or UK competition law the right to bring a monetary claim before the CAT, based on infringement decisions of either the OFT or the EC Commission, once all appeals possibilities relating to the underlying decision have been exhausted.

The time limit for making such a claim is set out in Rule 31 of the CAT Rules. A claim for damages must be made within a period of two years beginning with the relevant date. The relevant date for this purpose is the later of the date on which the cause of action accrued, the date on which a right to bring an appeal expires or the date of the final judgment in an appeal.

BASF argued that the claim against them was time-barred, on the basis that the relevant infringement decision was adopted on 21 November 2001 and that no appeal proceedings had been instituted by BASF which would have postponed the date for this two year time limit to start running. According to BASF, the proceedings it had brought against the imposition of the penalty were irrelevant and had no effect on the running of time, as they did not relate to the decision that BASF had infringed the prohibition in Article 81(1) EC Treaty. Therefore, time began to run in early February 2002 and the claim was brought well outside the two year time limit.

The claimants on the other hand argued that the two year time limit for bringing the follow-on damages claim did not begin until the appeal proceedings brought by BASF in the CFI were determined (15 March 2006), and that it was irrelevant that this appeal only related to the fine imposed.

The CAT decided that the question of whether the action is time-barred under Section 47A of the Competition Act 1998 and Rule 31 of the CAT Rules should be heard as a preliminary issue.

CAT ruling

The CAT issued a ruling in September 2008 finding that the claim was not time-barred. It stated that the purpose of the requirements set out in the Competition Act provisions relating to follow-on claims is to prevent claims for damages being brought in the CAT before the decision relied upon has become definitive. All appeals against that decision, which may bear upon issues relevant to the determination of a monetary claim must have been determined. An appeal on penalty may raise issues concerning, for example, the gravity, duration and scope of the infringement, which would be relevant not only to the penalty but also to the liability in damages. The reference to a decision in Section 47A of the Competition Act should therefore not be taken to be limited to the section in the Commission's decision relating to the infringement only and there should be no distinction between appeals against findings of infringement in a decision and appeals against the penalties imposed in a decision.

According to the CAT, the relevant date for the purpose of Rule 31 fell on the expiry of the period during which an appeal against the judgment of the CFI could have been brought before the ECJ (15 May 2006), and the claimant's action was not time-barred.

Court of Appeal judgment

The Court of Appeal disagreed with the CAT's interpretation. Going back to what it called 'the plain and ordinary meaning of the statutory language', the Court concluded that the wording of Section 47A and the wider statutory context of the Competition Act showed that there is a clear distinction between a decision that a relevant prohibition has been infringed and a decision to impose a penalty. Damages actions under Section 47A of the Competition Act are only concerned with infringement decisions.

The CAT's concern that an appeal against a penalty may raise issues which are relevant to the liability in damages does not justify a departure from the plain and ordinary meaning of the statutory language. If in a particular case a pending appeal against a penalty does have serious implications for a claim under Section 47A, the CAT can stay the claim pending determination of the penalty appeal.

The EC Commission issued a single decision, containing in separate articles, its findings as to infringement (Article 1) and the fines imposed (Article 3). In substance however the decision that an undertaking has infringed the relevant prohibition is distinct from the decision imposing a penalty on that undertaking for the infringement. BASF did not bring proceedings against the decision that the prohibition in Article 81(1) had been infringed; its appeal related solely to the fine. It follows that the appeal did not have the effect of extending the period during which proceedings in respect of the claim can be brought and the claim was therefore held to be time-barred and can now only proceed if the CAT grants an extension of time.