Supreme Court allows appeal clarifying scope of application of EU non-discrimination law

The Supreme Court has allowed the Secretary of State’s appeal in R(Fratila) v Secretary of State for Work and Pensions. The judgment can be found here.

The case concerned the scope of application of Article 18 TFEU, which prohibits discrimination on grounds of nationality. The applicants had obtained “pre-settled status” under the UK’s EU Settlement Scheme. Those rules created new domestic rights of residence for certain EU citizens in the UK prior to IP Completion Day, in preparation for Brexit. Those who satisfied the rules but had not yet completed five years of lawful presence in the UK were granted “pre-settled status”. Legislation provided that pre-settled status did not itself satisfy the requirement to have a “right to reside” in order to claim Universal Credit (and certain other benefits).

The facts of the case concerned the position prior to IP Completion Day.

The applicants argued that this gave rise to direct discrimination on grounds of nationality, contrary to Article 18 TFEU, in reliance on a line of cases including C-456/02 Trojani. They argued that once a citizen is granted a right of residence in another Member State under the provisions of domestic law, they are entitled to the same benefits as a national of that state also having a right of residence. The Court of Appeal accepted this argument, and the majority concluded the rules were directly discriminatory and could not be justified. The Secretary of State appealed to the Supreme Court.

In July 2021 in Case C-709/20 CG, the CJEU ruled that an EU citizen could only rely upon Article 18 TFEU if their residence in a host Member State complied with the conditions laid down in Directive 2004/38 EC, the Citizenship Directive.

As the applicants in the Fratila case had not complied with those conditions, the Supreme Court ruled that they could not rely on the EU principle of non-discrimination to claim a right equal treatment in respect of entitlement to Universal Credit, and allowed the appeal.

The case is of importance in establishing that rights of residence in domestic law do not give rise to a right of equal treatment under Article 18 TFEU in EU law.

Tim Ward QC acted for the Secretary of State

Monckton Chambers supports CLIPS regime through Chancery Bar Association

At the return date for a freezing injunction granted ex parte, Will Hooper, acting pro bono for the Respondent under the Chancery Bar Litigant in Person Support Scheme (CLIPS), successfully obtained the discharge of the injunction in circumstances where the Applicant had failed to show a real risk of dissipation of the Respondent’s assets. Will also secured a litigant-in-person costs order under CPR r. 46.5 in favour of the Respondent for the Respondent’s work in response to the application; and a costs order in favour of the Access to Justice Foundation under CPR r. 46.7 and s. 194 Legal Services Act 2007.

Monckton Chambers is proud to support the CLIPS regime and its important work in promoting access to justice for all.

The battle over the legality of Interchange Fees continues: Kassie Smith QC and Fiona Banks in CAT summary judgment decision against Visa and Mastercard

The Competition Appeal Tribunal handed down judgment on 26 November 2021 in Dune Group Limited and ors v Mastercard and Visa and ors [2021] CAT 35. The judgment represents the latest in a long line of cases considering whether the card schemes rules, obliging the payment of an interchange fee by acquirers to issuers in respect of each transaction settled over their payment platforms constitutes a breach of the Chapter I prohibition and/or Article 101 TFEU. The Claimants brought an application for summary judgment in respect of their claims relating to the payment of UK and other European domestic MIFs, commercial card MIFs and Inter-regional MIFs, including for the period after the coming into force of the Interchange Fee Regulation (the “IFR”), arguing that the essential factual basis of the present claims is materially indistinct from the basis of the previous Court of Appeal ([2018] EWCA Civ 1536) and Supreme Court ([2020] UKSC 24) judgments considering MIFs.

The Tribunal held that both card schemes had breached the Chapter I prohibition and/or Article 101 TFEU for the period up to the coming into force of the IFR in respect of consumer intra-EEA MIFs and UK, Irish, Gibraltar and Malta domestic consumer MIFs. For the period after the coming into force of the IFR, the Tribunal considered that the question of whether there is a restriction of competition would need to be resolved at trial.

In respect of Inter-regional, Commercial Cards and Italian domestic MIFs, the Tribunal considered that neither the European or domestic appellate judgements were binding on the question of whether Article 101(1) had been breached and again this was a matter which needed to be heard at trial.

However, the Tribunal found against Visa, in finding that although set by Visa Inc after 19 June 2016, the Visa scheme MIFs constituted an agreement between undertakings or a concerted practice for the purpose of Article 101(1) and the acquisition of Visa Europe by Visa Inc does not give rise to an arguable defence to the claims. Moreover, although Visa Europe is not responsible for setting the Inter-regional MIF, there remained an agreement or concerted practice for the purpose of Article 101(1) in respect of those MIFs – the European acquirers having agreed with Visa Europe that they will pay oversees issuers the inter-regional MIF set by Visa Inc.

Kassie Smith QC and Fiona Banks appeared on behalf of the Claimants.  Click here for the CAT’s judgment.

Privy Council rules on telecoms access rights to Gibraltar data centre

The Privy Council has today handed down judgment in Gibfibre Ltd v Gibraltar Regulatory Authority [2021] UKPC 31, upholding the regulator’s decision that a rival network operator had no right of access to a data centre operated by Gibtelecom Ltd.

Gibtelecom is the state owned former monopoly provider of telecoms services in Gibraltar. It also operates a data centre which is a significant centre for the international online gambling industry. Gibtelecom provides electronic communications services to the servers stored by the data centre’s customers. Gibfibre Ltd, which operates a rival fibreoptic network, had sought to establish a right under the Access Directive to provide services directly to the data centre’s customers in competition with Gibtelecom. The Gibraltar Regulatory Authority (GRA) had accepted Gibtelecom’s submission that it had no power to enforce such a right. Gibfibre appealed.

The Gibraltar Court of Appeal had determined that although the data centre formed no part of Gibtelecom’s network, with the result that there was no right of access pursuant to any SMP remedy, the GRA nonetheless had a broad discretion under Article 5 of the Access Directive to require Gibtelecom to provide such access. The GRA appealed to the Privy Council against that decision, and Gibtelecom intervened in support.

Lord Hamblen, giving judgment for the majority, accepted Gibtelecom’s submission that the requested access fell outside the scope of the Access Directive altogether, and that therefore Article 5 could not endow the GRA with the power to require an operator to allow access to physical infrastructure where the relevant infrastructure could not be described as being part of Gibtelecom’s own electronic communications network or its associated facilities.

Lord Sales, concurring in the result, said that had there still been power to do so, he would have made a reference to the CJEU on the point, which was not acte clair. However, there was no longer any power to make a reference, and the the CJEU would have been unlikely to reach a different conclusion in any event.

The judgment is available here.

Robert Palmer QC acted for Gibtelecom Ltd.

CJEU decides that EU freedom of establishment rules limit Member States’ ability to give less favourable treatment to a bankrupt’s pension savings in other Member States

In a judgment issued today the Court of Justice of the EU held that Article 49 TFEU (freedom of establishment) limited the ability of the UK, in its insolvency rules, to give less favourable treatment to a bankrupt’s pension in a scheme registered in another Member State than it would have given had the pension been in an equivalent UK pension scheme.

The case concerned an Irish property developer, Mr M, who had put assets into an Irish pension scheme approved under Irish tax law. Subsequently, he moved to the UK to start a self-employment as a business consultant. He was then made bankrupt in the UK. The trustees in bankruptcy claimed that the assets in the Irish scheme formed part of the bankruptcy estate. However, UK insolvency law generally excludes assets in a UK pension scheme registered with HMRC from the bankruptcy estate. Mr M argued that Article 49 of the Treaty on the Functioning of the EU required his Irish pension assets to be treated in the same way as if they were in a registered UK scheme. The trustees in bankruptcy argued that Article 49 did not apply. In January 2020, the High Court referred that question to the CJEU (here). It added that, if Article 49 did apply, it would be possible to “read down” the relevant statutory provisions so that the general exclusion for pension assets in UK schemes registered with HMRC also applied to equivalent schemes in other Member States.

In today’s ruling, the CJEU agreed with Mr M that Article 49 applied and that, unless there was a justification for the difference of treatment (a point not taken by the trustees before the High Court, and as to which the Court saw a number of significant difficulties) then Article 49 precluded the difference in treatment between Mr M’s assets in hisIrish pension scheme and assets in an equivalent UK scheme.

This reference was made before the end of the transition period on 31 December 2020: under Article 86 of the Withdrawal Agreement the Court of Justice of the EU continues to have jurisdiction to rule on references from UK courts made that date, and the ruling is binding on the UK.

George Peretz QC acted for Mr M in the High Court and in the Court of Justice of the EU.

Representative actions & data protection – the Supreme Court gives judgment in Lloyd v Google

The Supreme Court today handed down judgment in Lloyd v Google [2021] UKSC 50.

Allowing Google’s appeal, the Supreme Court held that damages cannot be awarded under the Data Protection Act 1998 for “loss of control” of data without proof that it caused financial damage or distress. On that basis, it concluded that the claim was not suitable to proceed as a representative action, because compensation for the alleged breaches of data protection law would need to be individually assessed. Delivering the single agreed judgment of the Court, Lord Leggatt stated: “In order to recover compensation under the DPA 1998 for any given individual, it would be necessary to show both that Google made some unlawful use of personal data relating to that individual and that the individual suffered some damage as a result” (§8).

The Supreme Court, however, limited its analysis to the old data protection framework and did not opine on the wider merits and desirability of a representative action of this kind. It thus left open the possibility of future representative actions in data protection cases being brought under the UK GDPR and the Data Protection Act 2018, or for misuse of private information.

The judgment is available here. A detailed case note by Laura Elizabeth John is here.

Gerry Facenna QC and Nikolaus Grubeck acted for the First Intervener, the Information Commissioner.

Robert Palmer QC and Julianne Kerr Morrison acted for the Second Intervener, Open Rights Group.

Josh Holmes QC, Ciar McAndrew and Antonia Fitzpatrick act in £380m opt-out collective proceedings against CompareTheMarket

An opt-out collective claim on behalf of over 20 million UK consumers has today been filed against the companies which own and operate the price comparison website CompareTheMarket.com.

The claim is based on a decision of the Competition and Markets Authority, which last year found that CompareTheMarket infringed competition law by using “wide most favoured nation clauses” in its contracts with a number of insurers.

The proposed class representative, Home Insurance Consumer Action Limited, contends that these wide MFNs also caused millions of consumers to pay higher prices for their home insurance.

The proposed class representative is represented by Josh Holmes QC, Ciar McAndrew and Antonia Fitzpatrick, alongside Tristan Jones. The counsel team is instructed by Nicola Boyle, Lucy Rigby and Luke Grimes of Hausfeld & Co. LLP.

The claim is further proof of Monckton Chambers’ status as the go-to set for collective proceedings, with members currently acting in Merricks, FX, Pride, Train Tickets, Trucks, Le Patourel, McLaren, and Coll.

Court of Appeal rules on suspension of relief under retained EU law

In R (Open Rights Group & The3Million) v SSHD & SSDCMS [2021] EWCA Civ 800, the Court of Appeal found that the ‘Immigration Exemption’ under the Data Protection Act 2018 is incompatible with retained EU law. The Court has now given a further judgment dealing with the jurisdiction to suspend relief: [2021] EWCA Civ 1571.

In this judgment, the Court of Appeal held that it had the jurisdiction, derived from retained EU law, to suspend the disapplication of legislative provisions such as the Immigration Exemption. That jurisdiction should be exercised only if the court is satisfied that (i) the period of suspension imposed is really needed to avoid legal uncertainty (ii) the party requesting the suspension has acted in good faith, and (iii) immediate disapplication would cause “serious difficulties”. On the facts, the Court of Appeal decided that it was prepared to suspend relief but, given the requirement of strict necessity identified in the authorities, only until 31 January 2022, in order to provide a reasonable time for the Data Protection Act 2018 to be amended so as to remedy the incompatibility.

Julianne Morrison and Nikolaus Grubeck acted for the successful Appellants.

CAT certifies “Boundary Fares” opt-out collective proceedings against the operators of the South Eastern and South Western rail franchises

Today, the Competition Appeals Tribunal (CAT) has certified two separate applications for opt-out collective proceedings against the operators of the South Eastern and South Western rail franchises for alleged abuses of their dominant positions in relation to the sale of “Boundary Fares”, a type of extension ticket for use in conjunction with a TfL Travelcard.

The class representative, Mr Justin Gutmann, alleges that the train operating companies abused their dominant position by failing to make Boundary Fares sufficiently available, or to use their best endeavours to ensure a general awareness among their customers of Boundary Fares, with the result that many Travelcard holders paid twice for part of their rail journeys.

Mr Gutmann will now represent an estimated 3 million London rail passengers in their claims which have an estimated total value of £93 million across the two claims.

The unanimous judgment from the CAT (available here) dismissed the respondents’ applications for strike out and summary judgment, holding that the applicant’s case on abuse is reasonably arguable, and not a “dramatic extension of the existing law”.  The CAT also found that the claims satisfy the authorisation and eligibility requirements for collective proceedings, and that the claims should be allowed to proceed on an opt-out basis.

The judgment addresses a number of important issues that are of broader relevance to the UK collective proceedings regime, including the extent to which there remains a need for individual factual assessment in collective proceedings, the extent to which a class may contain members that have not suffered loss, and a discussion of the different approaches taken by the UK and the Canadian regimes to aggregate damages awards.

The decision is only the third collective proceedings order granted by the CAT following its earlier judgments in Merricks and Le Patourel.

Philip Moser QC, Stefan Kuppen and Alexandra Littlewood (instructed by Hausfeld & Co LLP and Charles Lyndon Ltd) represent the successful class representative.

Tim Ward QC and James Bourke (instructed by Slaughter and May) represent First MTR South Western Trains Limited.

Paul Harris QC, Anneliese Blackwood and Michael Armitage (instructed by Freshfields Bruckhaus Deringer LLP) represent London & South Eastern Railway Limited.

Freedom of information: Alison Berridge represents requester in key Upper Tribunal case on national security exemptions

The Upper Tribunal has ruled on the practice of public authorities refusing FOIA requests citing both ss 23 and 24 “in the alternative”, despite the fact that they are mutually exclusive and only one can apply to any piece of requested information.

The so-called “masking” practice arose because citing (or not citing) s.23 would reveal whether the requested information related to a security body, something the FCDO argued may raise national security issues.

The Tribunal accepted the national security concerns, which it concluded were for the executive to evaluate, and held that in the context the requirement to “specify” the exemption relied on means no more than to “cite” or “identify” it.

Alison Berridge represented one of the three requesters.

The decision is available here.