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 3

Posted on 26 Sep 2016 by Brick Court

Daniel Jowell QC

(3) Commission decisions

Many current actions for damages for breach of Articles 101 and 102 rely, in whole or in part, on decisions of the European Commission that establish an infringement of those provisions by the addressees. These decisions are currently binding on the English courts.

It is tempting to suppose that, after Brexit, this will no longer be so.  It is correct, in this regard, that, unless other provision is made by Parliament, the English courts will cease to be bound by Regulation 1/2003 (the Modernisation Regulation) and by the ‘duty of sincere cooperation’ with EU institutions.  However, such a view overlooks the existence of section 58A of the Competition Act 1998. 

Section 58A provides that “infringement decisions” (which include a decision of the European Commission “that the prohibition in Article 101(1) or the prohibition in Article 102 has been infringed”), once they become final, are binding before the High Court (as well as in actions for damages and in collective proceedings before Competition Appeal Tribunal).  Commission Decisions become final when the time for appealing against that decision to the European Court expires without an appeal having been brought or when an appeal to the European Court has concluded.

Since s58A is part of Statute (and not merely an EU regulation) it follows that, regardless of U.K.’s withdrawal from the EU, the English High Court and Competition Appeal Tribunal will continue to be bound by that statutory provision even after the U.K. leaves the EU.

It is possible, of course, that Parliament will choose expressly to repeal s58A as part of the legislation relating to the implementation of Brexit.  This might be on the ground that it would be inappropriate, after choosing to leave the EU, for the English courts to continue to be bound by any measures of the European Commission – even in matters relating to the application of EU law to conduct implemented in the EU (and not the U.K.).[1]

However, it is not obvious what practical purpose would be served by such a repeal.  After all, if s58A were repealed the effect would not be to liberate the addressees of Commission decisions from the binding effect of those decisions (or their consequences in follow on damages actions).[2] Rather, the effect would be to encourage claims based upon those Commission decisions to be brought in Member States of the EU (where they would clearly continue to be binding) rather than in the U.K. It is unlikely to be to the advantage of UK businesses, whether they be claimants or defendants in such actions, to be forced to litigate such claims in the courts of EU Member States rather than in this jurisdiction.

[1] If the provision were to be repealed, Claimants would still be able to target with some confidence those defendants that had made admissions of liability to the Commission in the context of seeking immunity or leniency.

[2] It might be that defendants would not be liberated even if claims were brought in the English courts if it transpires that the binding effect of Commission decisions is (via Regulation 1/2003 and the Damages Directive) to be properly regarded as part of the applicable substantive (as opposed to procedural) foreign law.