Follow-on actions for breach of competition law

11 Aug 2015

Part of the Collyer Bristow guide to UK and EU competition law for overseas clients

Historically, competition law has been a matter for public enforcement, with those who infringe it subject to penalty from regulators. However, there is an increasing impetus towards so-called "private enforcement" where the victims of anticompetitive behaviour sue for damages. In this regard, three developments are of particular interest:

Follow-on actions 

The right to sue for damages for competition law infringement was established in the landmark claim of publican Bernie Crehan against Courage and Inntrepreneur, in which our head of Competition Law, Stephen Critchley represented Mr Crehan. However, it did not lead to a rush of claims, partly because of the difficulty in proving anticompetitive behaviour. The Crehan case, for instance, ran from 1994 to 2006.

The problem is not so great where the infringing behaviour has already been established in a decision by a competition regulator, as such decisions are binding on the UK courts. Those who believe they have suffered as a result of the infringement can therefore bring a “follow-on” action in which liability need not be proved. The court only has to decide whether the infringement caused loss to the claimant and, if so, how much.

  • Infringement decisions of the Europeans Commission are binding on the UK courts by virtue of Article 16 of the Modernisation Regulation”, so damages actions following on from such decisions have effectively existed since the Crehan case.

The Enterprise Act 2002 bolstered follow-on claims in two regards:

  • infringement decisions of the UK regulator were made binding on the courts by s20 of the Act, which inserted s58A into the Competition Act 1998; and
  • infringement decisions of the European Commission and the UK regulator were made binding on the Competition Appeal Tribunal by s18, which inserted s47A into the Competition Act 1998.

Consequently, any undertaking that believes it has been adversely affected by anticompetitive behaviour established by such a decision should consider whether the loss may be large enough to merit a claim.

Click here for a list of notable infringement decisions.

Despite the comparative ease of follow-on actions, it is still not realistic to expect such actions by large numbers of purchasers, each of whom have suffered small losses, so the Enterprise Act also included provision for so-called "super-complainants" like the consumer body Which? to bring follow-on actions on their behalf.

Additionally, the Consumer Rights Act 2015 has introduced collective actions in which, for example, a single purchaser can act as a representative bringing a claim on behalf of an entire class. Click here for details of this recent reform of the UK damages regime or here to return to our Guidance on Actions for Damages.

For further information please contact:

Stephen Critchley

T +44 (0)20 7470 4421

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Additional information