The Supreme Court has upheld the taxpayers’ arguments that they were not transferors for the purposes of the Transfer of Assets Abroad Regime (section 739 ICTA 1988 and section 720 ITA 2007). The case concerned the transfer of a business by a UK company of which the taxpayers were each minority shareholders to a company resident in Gibraltar. The Court has held that, in circumstances in which the taxpayers were each minority shareholders in the company that made the transfer of assets, they were not either singly or collectively the transferors of the business.

Brendan McGurk represented HMRC and was led by David Ewart KC of Pump Court Tax Chambers.

To view a copy of the judgment, please click here.

Vision Dispensing Limited v The Commissioners For His Majesty’s Revenue And Customs

Brendan McGurk successfully acted for the Commissioners in their defence of an appeal brought by Vision Dispensing Limited (“VDL”). VDL supplies services in connection with the online sale of contact lenses and this appeal was concerned with the question whether those supplies ought to be standard rated (as HMRC contended) or exempt on the basis that they involved the provision of medical care (as VDL contended). More particularly, VDL argued that it provided an online supply of exempt ‘dispensing services’ that were made in relation to the online supply (by another company in the group of which VDL was a member) of contact lenses. VDL needed to satisfy the Tribunal on two issues: (1) First, that its supplies constituted medical care and (2) second, that those supplies were wholly performed or directly supervised by appropriately medically trained persons. VDL failed on both grounds.

The appeal and the Tribunal’s analysis will be of wider relevance to suppliers of online services who seek to rely upon the medical exemption in schedule 9 of the VAT Act.

The CAT has certified collective proceedings brought on behalf of 8.9 million Sony PlayStation UK customers for damages as a result of alleged supra-competitive pricing of games and add-on content purchased through the PlayStation Store.

The judgment is the first to address a PCR’s funding arrangements following the judgment of the Supreme Court in PACCAR. The CAT found the PCR’s revised funding arrangements would be enforceable.

The CAT also ruled for the first time that its jurisdiction to make a CPO pursuant to section 47B of the Competition Act 1998 is limited to claims which exist as at the date of the Claim Form. Certification is therefore subject to amendment of the class definition to remove so-called “future claimants” whose alleged losses post-date the filing of the Claim Form.

Robert Palmer KC, Fiona Banks and Antonia Fitzpatrick represented the Class Representative, Alex Neill Class Representative Limited, instructed by Milberg London LLP.

Daniel Beard KC represented the Defendants, Sony Interactive Europe Limited and Sony Interactive Entertainment Europe Limited, instructed by Linklaters LLP.

The judgment is available here: Alex Neill Class Representative Limited v Sony Interactive Entertainment Europe Limited; Sony Interactive Entertainment Network Europe Limited

The Competition Appeal Tribunal has handed down judgment in Sky v Ofcom [2023] CAT 70.

The Tribunal upheld Ofcom’s construction of section 32(2) and (2A) of the of the Communications Act 2003, which underpinned Ofcom’s Decision that Sky’s pay TV services, which rely in whole or in part on a digital satellite transmission service, constitute an electronic communications service (“ECS”) within the meaning of that section, and that Sky was therefore required to send end-of-contract notifications to customers of its pay TV services. It found that “as a matter of construction of section 32(2) and (2A), it is necessary first to exclude the element of a service which is a “content service” before considering whether the rest of the service falls within the definition of section 32(2A)(c) as “consisting in, or having as its principal feature, the conveyance of signals”.”

On that basis, the Tribunal concluded that Sky’s pay TV service is an ECS within the meaning of section 32(2) and (2A)(c) of the 2003 Act. It held that Ofcom erred in not considering in the Decision whether the element of conveyance of signals predominates over the Other Non-Content aspects of the Sky Pay TV service, but that, in any event, it does so predominate. As such, the overall conclusion in the Decision was correct.

Meredith Pickford KC and David Gregory acted for Sky.

Josh Holmes KC, Julianne Morrison and Nikolaus Grubeck acted for Ofcom.

Phones 4U Limited (in administration) V EE Limited and Others

Judge’s short summary of the judgment Phones 4U Limited (in administration) V EE Limited and Others

In a judgment handed down on Friday 10 November 2023, Mr Justice Roth has dismissed the claims made by Phones 4U against the mobile network operators EE, Telefonica and Vodafone, and those made against EE’s former parent companies Orange and Deutsche Telecom. The Judgment is a rare judgment on a standalone competition claim, and follows a trial in the Competition List of the High Court which ran from May to July 2022. The Judgment, which runs to 208 pages, contains discussion of a number of important topics for competition lawyers including the extent to which collusion may occur in a bilateral exchange where one party declines to participate, public distancing, the rebuttal of the presumption of conduct on the market, document preservation, the drawing of adverse inferences from the absence of witnesses and the importance of competition law compliance policies.

Monckton members acted for two of the successful defendants: Meredith Pickford KC and David Gregory for EE and Rob Williams KC for Vodafone.

Mr Justin Gutmann v Apple Inc., Apple Distribution International Limited, and Apple Retail UK Limited

The Competition Appeals Tribunal (CAT) has today certified opt-out collective proceedings brought on behalf of millions of iPhone users against the Apple corporate group. The Class Representative, consumer champion Justin Gutmann, alleges in summary that Apple abused a dominant position in the way it introduced software updates for approximately 34 million iPhones. These updates were designed to reduce the rates of “unexpected power offs” experienced by users. It is alleged that Apple concealed from users that the updates considerably slowed down the iPhones in certain circumstances. The claim is estimated to be worth at least £853 million and follows similar class actions and regulatory proceedings brought against Apple around the world.

The CAT’s unanimous judgment concludes that Mr Gutmann has a realistic prospect in making good his case at trial and that the claims should be certified (subject to the resolution of any funding issues arising from the Supreme Court’s judgment in PACCAR). In reaching this conclusion, the CAT dismissed Apple’s strike out and summary judgment applications concerning the evidential basis for the claim and the period following an Apple apology published in December 2017, challenges to Mr Gutmann’s methodology for assessing loss, and a challenge to the suitability of Mr Gutmann to bring the claim.

Philip Moser KC, Anneli Howard KC, Stefan Kuppen, Will Perry and Natalie Nguyen represented the successful Class Representative, Justin Gutmann, and were instructed by Charles Lyndon.

The case has been covered by Forbes, Reuters, Sky News, the Evening Standard and the Independent.

Karpichkov v National Crime Agency [2023] EWHC 2653 (KB)

The King’s Bench Division today dismissed an application by the National Crime Agency to strike out the claim brought by a former KGB double agent for breach of his data protection rights and misuse of his private information.

The Claimant – who the Court has directed may only be identified by his former name Boris Karpichkov – formerly worked for the KGB and, following the end of the Cold War, for the KGB and Latvian security services as a double agent. Fearing for his life, he fled Latvia with his family in 1998 and claimed asylum in the UK. He was granted British citizenship in 2010 under a new, undisclosed identity.

In 2019, Mr Karpichkov was arrested by Kent Police pursuant to a European Arrest Warrant issued by the Latvian authorities. In 2020, the Westminster Magistrates’ Court dismissed refused his extradition on the basis that it would breach his Convention rights, noting, among other things, that Mr Karpichkov had “an abundance of dangerous enemies in both Latvia and Russia“. In the course of processing the extradition request, however, the National Crime Agency disclosed Mr Karpichkov’s current name and address to the Latvian authorities.

In 2022, Mr Karpichkov brought a claim against the National Crime Agency, arguing that its disclosure of his current name and address to the Latvian authorities was not only unnecessary under the Schengen Information System then in force but also in breach of his Convention rights, his right to protection of his personal data and a misuse of his private information. Earlier this year, the Agency applied to strike-out Mr Karpichkov’s claims and obtain summary judgment against him, arguing that it was bound by the terms of EU law to disclose details of his current identity and address.

In today’s judgment, High Court Master McCloud dismissed the Agency’s applications, ruling that it was at least arguable that the Agency should have first considered whether its disclosures were truly “required”, taking into account Mr Karpichkov’s rights under the EU data protection legislation, the ECHR and EU Charter of Fundamental Rights.

Eric Metcalfe is instructed by Deighton Pierce Glynn for the Claimant, Mr Karpichkov.

Julianne Kerr Morrison was instructed on behalf of Mr Karpichkov at an earlier stage of the proceedings.

The case has been reported by Reuters and Yahoo news.

On 17 October 2023, the Competition Appeal Tribunal approved the consolidation of two applications for a collective proceedings order against Google, thereby avoiding a carriage dispute. The two proceedings concerned Google’s conduct in the ad tech sector and sought substantial damages on behalf of publishers. The proposed class representatives, Mr Arthur and Mr Pollack, agreed to consolidate their applications following negotiations between themselves and their teams, including their funders and insurers, and this step has now been approved by the CAT, subject to certification of the claims which the CAT will decide next year. The consolidated application will be pursued by Ad Tech Collective Action LLP, of which both the individual representatives are members, along with Kate Wellington. This is the first time in the UK that a carriage dispute has been resolved through a negotiated settlement, though the practice is common in other countries such as Canada that have class action regimes.

Gerry Facenna KC, Julian Gregory, Alison Berridge and Nik Grubeck represent Ad Tech Collective Action LLP, instructed by Hausfeld & Co. LLP, Humphries Kerstetter LLP and Geradin Partners Limited. The consolidated claim is being funded by Fortress. Meredith Pickford KC represents Google, instructed by Herbert Smith Freehills LLP.

Robert Palmer KC, Julian Gregory and Will Perry are working to prepare opt-out collective proceedings against Valve Corporation. Valve operates Steam, one of the world’s largest digital video game distribution platforms. The claim, which will be issued in the Competition Appeal Tribunal in the coming weeks, will allege that Valve used its market power in a way which has led to consumers being overcharged for games and in-game content distributed via Steam.

Robert, Julian and Will are acting for Proposed Class Representative, Vicki Shotbolt, a prominent campaigner for children’s digital rights. They are instructed by Milberg London LLP (see their press release here) and are working with funders Bench Walk Advisors, and economists from the Berkeley Research Group.

In an unusual claim in the context of a commercial dispute, the Chancery Division made an order for an interim injunction in action for trespass and harassment against a well-known firm of debt collectors.

The claimant, an IT services provider, was in dispute with one of its suppliers over a number of invoices. Despite having no judgment in its favour or writ of execution, the supplier instructed a debt collection agency to enforce the alleged debt. The debt collection agency had previously featured in the Channel 5 series ‘Can’t Pay? We’ll Take It Away’.

Although warned not to do so, the debt collection agency sent bailiffs to both the IT company’s London office and the home of its managing director. The company therefore issued proceedings for trespass and harassment against the debt collection agency, and an interim injunction was granted preventing the bailiffs from coming with 10 metres of the company’s business address and its director’s home, communicating with the company other than through solicitors, or otherwise harassing it.

Alfred Artley acted for the successful claimant, instructed by Sajjid Kurmani of Freeths LLP.