Brick Court Chambers

Brexit Law Blog: Archive

This blog tracked legal issues arising from Brexit. It ran from the referendum in 2016 to last post in May of 2021.

Competition law damages actions in England for violation of Articles 101 and 102 after Brexit: Part 2

Posted on 26 Sep 2016 by Brick Court

Daniel Jowell QC

(2) Jurisdiction

The previous blogpost in this series considered whether a claimant that wishes to bring an action for damages for violation of Article 101 or 102 in the U.K. courts after Brexit will have a valid cause of action.  Assuming there is such a valid cause of action (a foreign tort), a claimant will still need to establish jurisdiction.  If the defendant is based in the U.K. then establishing jurisdiction will not be difficult, but in many cases a claimant will also wish to sue defendants domiciled elsewhere.

At present, our jurisdiction rules are governed by the Recast Brussels Regulation. A previous blogpost has argued that, after Brexit, the U.K. will, by virtue of Section 2(1) of the Civil Jurisdiction and Judgments Act 1982, fall back on the old Brussels Convention of which we are (and will be) still a contracting state.  Whether we are ultimately governed by the old Brussels Convention, or Parliament continues to apply the Recast Brussels Regulation or we join the Lugano Convention, all sets of rules potentially permit joinder of EU defendants to an anchor defendant domiciled in a contracting state. In particular, this is permitted where the claims against an (English) anchor and the other proposed defendants are so closely connected that it is expedient to hear and determine them together to avoid the risk of irreconcilable judgments resulting from separate proceedings.  In such circumstances, the English courts have no discretion to decline jurisdiction.[1]

The English courts have taken a generous approach to pleadings against English anchor defendants – permitting claims alleging secret infringements of competition law to proceed even in the absence of any direct evidence that the company in question was involved in the infringement[2]. It will, however, still be essential for a claimant to find an English defendant that may have been involved in the infringement of EU law on the Continent.  A defendant that merely sold cartelised goods in the U.K. might not suffice, unless that defendant was also arguably a participant in the cartel insofar as it was implemented or directly affected the EU (ex U.K.).

Furthermore, a company with its registered office in England might also be able to sue EU defendants in England for all of its loss arising from a cartel (apparently regardless of where it initially purchased the cartelised goods or services) under Article 5(3) of the Brussels Convention (now 7(2) of the Recast Regulation).[3]

Claims against foreign defendants that are not domiciled in the EU or EEA will not be governed by the Brussels Convention (or the Lugano or Recast Brussels Regulation).  Instead, a claimant against non-EU defendants will have to satisfy the requirements of the C.P.R. and common law and show the following:

  1. There is a real issue between the Claimants and an anchor defendant under Article 101 or 102 which it is reasonable for the Court to try and that the non EEA defendant is a necessary or proper party to that claim: CPR 6.37(1)(a), 6.37(2), and PD 6B paragraph 3.1(3).
  2. That the claim against the non EEA Defendant has a reasonable prospect of success: CPR 6.37(1)(b).
  3. That England is the proper place for the Claimants to bring the claim: CPR 6.37(3).

The applicable principles in applying the first condition were summarised by Lord Collins in Nilon Limited v Royal Westminster Investments SA and others [2015] UKPC 2 at [15].  It is important to note that, unlike with the Brussels Convention and Recast Brussels Regulation, the English court does have a ‘discretion’ to decline jurisdiction on ‘forum non conveniens’ or similar grounds: see, for example  Erste Group Bank AG London Branch v J ‘VMZ Red October’ & Ors [2015] EWCA Civ 379.  The courts may be more willing to exercise this discretion in relation to claims under Article 101 and 102 that will, after Brexit, be claims under foreign law.

[1] See Owusu v Jackson [2005] ECR I-1383.

[2] KME Yorkshire Ltd v Toshiba Carrier UK Ltd [2012] EWCA Civ 1190 at [38].  See also Sainsbury’s Supermarkets Ltd v Mastercard Inc [2016] CAT 11 at [363(7)]

[3] Case C-352/13 Cartel Damage Claims (CDC) Hydrogen Peroxide SA at [51] – [56]