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The CAT has handed down an important judgment in a post-Brexit jurisdictional challenge/ strike out application in Asda Stores Limited and Others v Bremnes Seashore AS and Others, a cartel damages claim brought by leading UK supermarkets against several of the largest global producers of farmed Atlantic salmon. The claim alleges a cartel infringement relating to the Norwegian spot price index that inflated the cost of salmon products in the UK.
Post-Brexit, claimants cannot simply rely on the heads of jurisdiction set down in the Brussels Recast Regulation or the Lugano Convention to seise the UK courts – instead they have to show that there is a serious issue to be tried and that the UK courts satisfy the Spiliada forum conveniens test. The re-introduction of the former common law test has introduced uncertainty regarding jurisdiction post Brexit.
The Defendants argued that the Norwegian courts were clearly more appropriate given that the alleged cartel took place in Norway and all the witnesses and documentary evidence relating to the cartel would be in Norway.
The Defendants also sought to set aside the Tribunal’s previous order granting permission to serve out of the jurisdiction for material non-disclosure on the basis that the proceedings are stand-alone rather than follow-on. This case is one of the first claims issued post-Brexit, where the Claimants rely on a European Commission Statement of Objections to support the cartel allegations in their claim. As yet there is no Commission infringement decision and, as the Commission investigation was formally instigated after the end of the Brexit implementation period, any Commission findings will not be binding on the Tribunal. Notwithstanding that any eventual Commission infringement decision would not be binding as to liability, the Tribunal confirmed that it may have regard to any eventual decision and the Commission’s findings may still be persuasive in UK stand-alone proceedings.
The claim, which will now proceed in the UK, gives important guidance for determining jurisdiction challenges on forum non conveniens grounds, an issue that has arisen in several recent post-Brexit cases. The Tribunal ruled that the UK, rather than the Norwegian courts, is the more appropriate forum to hear the claims. Although the main events relating to the cartel activities are alleged to have taken place outside the UK, the Tribunal found that the direct and indirect effects on UK prices relating to both Norwegian salmon and Scottish salmon (said to have resulted from the collusion in Norway) made the UK the natural and appropriate forum for the proceedings.
The Defendants also sought to strike out the claims against their UK subsidiaries, on the basis that they were engaged in different ‘economic activity’ as they primarily sold Scottish salmon rather than Norwegian salmon products. The Tribunal gave an important judgment regarding the interpretation and application of the Sumal test (a post-Brexit CJEU ruling) for being part of the same economic undertaking for the purposes of competition law. In this case, the UK subsidiaries were either wholly owned by the Norwegian Defendants or were part of 50/50 or 60/40 joint ventures. The Tribunal held that there was an arguable case on control or decisive influence and that the UK subsidiaries were engaged in the ‘same economic activity’ as their parents as they sold the same species of salmon products in the UK – it made no difference if there was a slight difference in the geographical denomination or commercial branding of their products. Accordingly, the Tribunal took a broader, pragmatic approach to the interpretation of economic activity. The ruling also confirms the importance of UK anchor defendants in establishing a substantial connection with the UK and demonstrating that the UK is an appropriate forum.
Anneli Howard KC, Julian Gregory and Alastair Holder Ross of Monckton Chambers, instructed by Stephenson Harwood, acted successfully for the claimant supermarkets.
Josh Holmes KC and Conor McCarthy of Monckton Chambers, instructed by Shepherd & Wedderburn, act for the SSF (Scottish Sea Farms) Defendants.