This week, the UK Department for Business, Innovation & Skills (BIS) published the Government Response (BIS/13/501) to its consultation on Private Actions in Competition Law launched in April 2012 (see BIS Press Release). The Response sets out a range of proposed reforms to the UK private actions regime for competition law, including a new opt-out collective action, an enhanced role for the Competition Appeal Tribunal (CAT) and a fast-track procedure for simpler cases.

While individuals or businesses can already bring private damages claims (either standalone or follow-on) arising from anti-competitive behaviour in the UK, competition offences are usually pursued by the UK Office of Fair Trading (OFT), and/or European Commission. This is in stark contrast to other jurisdictions, such as the United States, where private actions account for a greater share of antitrust cases. The UK government envisages that an increase in private actions will complement current public enforcement and so provide a further deterrence effect against competition law infringements.  

The most significant of the proposed reforms – which will require further policy development and primary legislation – are summarised below:

‘Opt-out’ collective actions: a fundamental reform

The Response notes the Government’s decision to introduce the possibility of an opt-out collective action. The current collective actions regime is limited to opt-in follow-on actions by representative bodies on behalf of consumers. The Consultation (BIS/12/742) argued that the regime is too restrictive, and noted that there had been only one successful case in almost ten years (namely, Which? Replica Football Shirts).

Under the proposed regime, collective actions will be available in both follow-on and standalone cases, with cases to be heard only in the CAT, and may be brought on behalf of either consumers or businesses, or a combination of the two. The CAT will be required to certify whether a collective action brought under the new regime is suitable for collective action, and whether it should proceed under an opt-in or an optout basis. The ‘opt-out’ aspect of a claim will apply to UK-domiciled claimants, though non-UK claimants will be able to opt-in to a claim if desired.

In order to prevent a “litigation culture”, the Response sets out certain safeguards designed to prevent vexatious or frivolous claims, including:

  • Cases to be certified by the CAT, such that only meritorious cases are taken forward.
  • Treble damages to have no place within the new collective actions regime (exemplary damages, awarded in the recent Cardiff Bus case, will be prohibited in collective actions).
  • Lawyers to be prohibited from charging contingency fees (or damages-based agreements), though conditional fee arrangements and after-the-event insurance will be permitted.
  • Explicit clarification in the CAT Rules of Procedure that the loser-pays rule should be the starting point for cost assessment.
  • Claims to be brought only by claimants or by genuine representatives of the claimants, such as trade associations or consumer associations. 

Enhanced role for the CAT: “an organisation with unfulfilled potential

The jurisdiction of the CAT is currently limited to hearing followon claims (i.e., private claims following a European Commission or OFT finding of an infringement), with so-called “stand-alone” actions being brought in the UK High Court. The Response envisages the establishment of the CAT as the main court for competition actions in the UK. To this end, the Government has decided to extend the CAT’s jurisdiction to stand-alone cases.

The Government has also decided that the limitation periods for the CAT should be harmonised with those of the High Court, with the six year limitation period to apply to all private action cases in the CAT bought in England and Wales and Northern Ireland, whether stand-alone or follow-on.

In addition, the Government also considers that the CAT must have access to the full range of remedies, including the power to grant injunctions. The Government plans to establish a fast-track for simpler cases in the CAT focused on granting injunctive relief.

Alternative Dispute Resolution (ADR): “litigation to be the option of last resort

The Response emphasises the role of consensual ADR as an alternative route to redress. In addition to the promotion of ADR throughout the proposals, the Government plans to introduce the following specific measures:

  • A new opt-out collective settlement regime for competition law in the CAT, similar to the Dutch Mass Settlement Act (2005), to allow businesses to quickly and easily settle cases on a voluntary basis; and
  • A role for the new Competition and Markets Authority in certifying redress schemes.

Other notable points:

The Consultation also focused on the interaction between public and private enforcement and, in particular, whether additional exposure to private actions may deter leniency applicants. One of the options considered included measures to protect the leniency regime by exempting leniency documents from disclosure. In the Pfleiderer case, the ECJ ruled that EU Law does not prohibit access to leniency documents by third parties seeking damages, and that access should be determined according to national law (weighing the interest in disclosure as against the need to protect an effective leniency programme). The Response supports the European Commission’s stated intention to propose a legislative solution balancing the respective interests (SPEECH/12/428). The Government has likewise elected to defer to the Commission initiative entitled “An EU framework for collective redress” following a public consultation in early 2011 (see 2012 Commission Work Programme).

Finally, the Response confirms that the Government will not introduce a rebuttable presumption of loss in cartel cases (consistent with long-standing English precedent) or directly address the ‘passing-on’ defence in legislation.  


As mentioned above, the Government proposals will require further development and primary legislation and it may be some time before they are fully implemented. Assuming the proposals are enacted envisaged in the Response, the new procedures may encourage claimants from across the European Union to opt-in to damages actions in the UK. Although, the Government remains keen to avoid the emergence of “US style class actions”, the opt out regime is a significant departure from previous resistance to any form of collective action. Furthermore, the emergence of the CAT as a “centre of excellence” in dealing with competition claims is likely to reinforce the UK’s position as being the jurisdiction of choice in the EU for litigating competition matters.