The Swatch Group AG and two of its subsidiaries have successfully obtained the dismissal of proceedings brought against them in the High Court by  the Claimant, a UK-based wholesaler of watch spare parts, which claimed that the refusal to supply it with spare parts for Swatch Group products breached EU and UK competition law.  The English proceedings were brought following some years of litigation involving the same issues in Switzerland before the Bern Commercial Court and the Swiss Federal Supreme Court, which inter alia clarified the conditions under Swiss law for obtaining a negative declaration.  After having established Swatch’s interest in a negative declaration and jurisdiction, the Swiss Courts rejected the claimant’s claims applying EU and UK law and granted Swatch a negative declaration in respect of the claimed infringements.  Dismissing the English proceedings the Judge, Mr Justice Michael Green, held that the Swiss Courts’ judgments were entitled to recognition under the Lugano Convention and that Swatch was entitled to the declaration it sought that the issues raised by the claimant in the English proceedings were res judicata.  The Lugano Convention continues to apply to cases started before the UK left the EU. The Judge considered he did not need to rule on the issue, but considered that the common law rules on recognition were broadly similar to those under the Lugano Convention. The Judge dismissed the claimant’s arguments that recognising the Swiss Courts’ judgments would be contrary to English public policy because it had not had a fair hearing in breach of Article 6(1) ECHR.  He also dismissed an argument that s.60A of the Competition Act 1998, which enables a court applying UK competition law post-Brexit to depart from EU competition law in certain circumstances, provided any basis on which the Swiss Courts’ judgments should not be recognised.  The Judge considered he did not need to rule on a further argument concerning whether a failure by Cousins to petition the European Court of Human Rights in respect of alleged failings by the courts of a signatory state to the ECHR meant that Cousins had failed to exhaust its remedies in Switzerland.   On 30 July 2024 the Court of Appeal (Green LJ) refused an application for permission to appeal by the Claimant due to lack of merit and absence of any public interest.  The High Court’s Judgment is accordingly now final.

A copy of the High Court’s Judgment can be found here

Ben Rayment was instructed by Addleshaw Goddard for Swatch.

The Court of Appeal today handed down judgment rejecting a London council’s attempt to close one of its primary schools that is in the process of becoming an academy.

Pooles Park Primary School (“the School”) was rated ‘Inadequate’ by Ofsted following an inspection in November 2022. This triggered a statutory duty for the Secretary of State for Education to make an Academy Order in respect of the School, which is situated in the London borough of Islington and maintained by the local authority (“the Council”). The legal effect of the Academy Order was to start a process directed at converting the School into an academy school sponsored by a multi‑academy trust outside of the local authority’s control.

At around the same time, the Council was consulting on options for managing, within its area, the London-wide problem of falling primary school rolls and the consequent need to reduce over-supply of school places. The Council ultimately decided that it wished to close the School, doing so as part of an overall strategy for reducing surplus school places. The Council therefore requested the Secretary of State to revoke the Academy Order so that the Council would be able to carry out its wish.

The then Secretary of State refused to do so, instead selecting a local multi‑academy trust (“MAT”) to become the School’s sponsor. The selected MAT specialises in providing education for children with complex special educational needs (“SEN”), in both mainstream schools and special schools. The MAT had put forward a proposal to operate the School in tandem with one of its existing local mainstream schools, sharing resources between the two schools and attracting additional pupils and funding by offering places to children with complex SEN who might otherwise be without a suitable school place. The Secretary of State’s Regional Director for London believed that this innovative proposal was an attractive one, given the growing demand for specialist provision for children with SEN and the shortage of places in special schools.

The Council brought a judicial review claim challenging the Secretary of State’s refusal to revoke the Academy Order. The Council argued that the MAT’s financial modelling underpinning its proposal was flawed and unrealistic, and that the Secretary of State was unlawfully undermining the Council’s ability to carry out its statutory remit to manage the efficient provision of school places in its area.

On 12 July 2024, the High Court (Choudhury J) dismissed the Council’s challenge: [2024] EWHC 1798 (Admin). The Judge held that it had not been necessary for the Minister who took the decision on behalf of the Secretary of State to be provided with, or to have sought to test the robustness of, the MAT’s financial modelling. Under the policy being applied by the Secretary of State at the time, a school that had been rated Inadequate should, save in exceptional circumstances, be converted to an academy and given the opportunity to improve with the support of its sponsor.

The Council applied to the Court of Appeal on an expedited basis for permission to appeal, arguing that the Judge had been wrong to find that the Minister had been provided with all the information that it was legally necessary for her to consider.

In today’s judgment ([2024] EWCA Civ 951), the Court of Appeal (Macur and Andrews LJJ) rejected the Council’s appeal. The judgment upheld the High Court’s conclusion that the Minister was provided with the “salient facts” and that the law did not require that she be shown, or that she seek to test, the MAT’s financial modelling or the assumptions underlying that modelling.

The interim relief that had been preventing the School from converting to an academy has therefore come to an end. Pupils who started the school summer holiday period not knowing whether their School would be closing this Autumn will now be returning there in September knowing that the School’s future is more secure.

Monckton barrister Alan Bates represented the Secretary of State in both the High Court and Court of Appeal.

The Supreme Court of Gibraltar has handed down judgment in Gibraltar’s first competition trial.

The Claimant (“Gibfibre”) alleged that a rival telecommunications operator (“Gibtelecom”) was acting in breach of an allegedly dominant position by refusing to grant Gibfibre access to a data centre from which it is providing colocation services.

Following a contested three-week trial, Restano J dismissed the claim. He found for Gibtelecom on all points, including (i) on the correct definition of the relevant market, (ii) the Defendants were not dominant in that market, (iii) in any event there was no abuse of a dominant position, and (iv) even a successful claim (contrary to his earlier findings) would have resulted in much lower damages than sought by Gibfibre.

The judgment is available here.

Robert Palmer KC and Nikolaus Grubeck acted for the successful Defendants and appeared with Moshe Levy and Samuel Marrache, instructed by Hassans

An attempt by Uber Britannia Limited to force private hire vehicle operators outside of London to contract directly with their customers, which threatened to upend industry structure by effectively abolishing the agency business model, has today been overturned by the Court of Appeal.

The Court discharged a declaration made by Mrs Justice Foster in July 2023 that, in order to operate lawfully under the Local Government (Miscellaneous Provisions) Act 1976 (the “Act”), operators are required to directly contract with passengers to provide the journey the subject of the booking.

Two operators, D.E.L.T.A. Merseyside Limited and Veezu Holdings Limited, appealed on the basis that the Act could not be interpreted as imposing an obligation on operators to so contract. They successfully argued that the Act addresses all contracts within a single provision, section 56, which deems there is a contract with the operator, regardless of which person has directly contracted with the customer. It made no difference that a requirement on operators to contract had been found to apply in London (in R (United Trade Action Group Ltd) v Transport for London [2021] EWHC 3290 (Admin)). The Private Hire Vehicles (London) Act 1998 was drafted in materially different terms.

One difference between an obligation to contract versus a deemed contract is in the potential fiscal consequences. If operators are bound to contract then they would be required to charge their passengers VAT. HMRC had previously launched a public consultation on the tax impact of the High Court’s declaration. It remains to be seen whether this will now be withdrawn.

Jen Coyne acted for the successful Appellant D.E.L.T.A. Merseyside Limited, led by Philip Kolvin KC and instructed by Layla Barke-Jones of Aaron and Partners LLP.

The Court of Appeal’s judgment is available here.

Blog posts written by Jack Williams on the topic of the content of retained EU law have been extensively cited and discussed by the UK Supreme Court in its recent judgment in Lipton v BA Cityflyer Ltd [2024] UKSC 24.

Although ultimately taking a different analytical route, Lord Burrows (as part of the majority) kindly described those posts as “carefully and tightly reasoned”. Lord Sales and Lady Rose (with whom Lady Simler agreed) likewise discussed the blog posts, albeit again reaching a different view after engagement with them. Lord Lloyd-Jones, dissenting, also cited the blog posts, but this time tracked and agreed with the reasoning in them.

Despite the differences in approach, it is most gratifying and encouraging that the Justices of the Supreme Court read and engaged so extensively with blog posts published on Monckton Chambers’ UK-EU Relations law blog, available here.

The judgment can be found here and the relevant blog posts are here and here.

On 27 June, the Court of Justice of the EU published its judgments on the various appeals to the Court of Justice relating to the European Commission’s 2014 decision finding that Servier and a number of producers of generic medicines had infringed Article 101(1) of the Treaty on the Functioning of the EU by entering into agreements concerning perindopril, an important treatment for hypertension and heart problems.  The Commission imposed significant fines.

Under the agreements, the generic producers abandoned their challenges to the validity of various patents held by Servier in relation to the manufacture of perindopril and agreed not to supply generic versions of perindopril for a period.  In return, Servier made substantial payments to those producers and entered into various distribution agreements with those producers under which they would distribute Servier-produced perindopril.

In 2019, the General Court of the EU largely dismissed the companies’ appeals, though it overturned the Commission’s finding that Servier had also breached Article 102 TFEU (abuse of dominant position), and found that two of the agreements involving Krka were not infringements.

The Court of Justice judgments confirm that the agreements were unlawful market exclusion agreements that restricted competition.  It also overturned the General Court’s decision to annul the Commission’s finding that Servier had infringed Article 102, and its decision in relation to the two Krka agreements, remitting that matter to the General Court.

George Peretz KC and Ben Rayment acted for the European Commission on, respectively, the Teva and Lupin appeals, and Josh Holmes KC and Philip Woolfe KC acted for the UK government, which intervened in the appeals in support of the Commission (the UK still being a Member State at the time that the appeal was brought).

The Competition Appeal Tribunal today ruled that the NHS is not time-barred from pursuing claims for damages against Lundbeck, the Danish pharmaceutical company, and various manufacturers of generic pharmaceuticals, arising out of the “pay for delay” cartel found by the European Commission.

In 2013, the Commission found that Lundbeck, which held various patents in relation to the manufacture of citalopram, a regularly-prescribed treatment for anxiety and depression, had agreed with generic manufacturers that they would abandon their legal challenges to Lundbeck’s patents and stay out of the market in return for payments equivalent to the amount of profit that those generic companies would have made on successful entry.  The Commission found that those agreements breached EU competition law.  In March 2021 the European Court of Justice gave judgment upholding a ruling of the EU General Court that dismissed the companies’ appeals against the Commission’s decision.

The NHS brought an action for damages arising out of the companies’ breach of competition law in the High Court in 2019, just before the sixth anniversary of the Commission’s decision, and that action was transferred to the CAT in 2021.  It was agreed in the transfer order that the NHS would file a claim form in the CAT setting out the details of its claim, which it did in March 2023 (less than 2 years after the Court of Justice’s ruling).

The companies then claimed that the NHS was out of time, under the six year period set out in the Limitation Act 1980, on the basis that it knew or should have known before the date of the decision that it had a cause of action.  The NHS conceded that point, but relied on a separate limitation period under the CAT’s rules that ran for two years from the date of the Court of Justice’s judgment.  The companies accepted that that separate period could have applied, but argued that the filed claim form could not be regarded as a claim form making a new claim, as it was no more than a step in the transferred proceedings.  They also argued that the NHS was estopped from relying on the separate limitation period.

The CAT held that the claim form did have the legal effect of starting proceedings within the separate limitation period, and that proceedings were therefore brought in time.  It also held that there was no estoppel as alleged by the companies.

The NHS’s claim for damages will now proceed.

George Peretz KC represented the NHS before the CAT: he previously represented the European Commission in its successful defence to the appeals in the EU General Court and Court of Justice.

The Administrative Court has handed down judgment in a public law challenge concerning a £2.4bn Private Finance Initiative (PFI) project for Birmingham’s road network.

PFIs are long-term contracts between a private party and a government entity where the private sector designs, builds, finances and operates a public asset and related services, and bears the financial risks of doing so.

In 2010, Birmingham City Council (BCC) entered into a project agreement with a private contractor for delivery of a 25-year PFI project that includes 2,500 km of the city’s road network, up to 100,000 street lighting columns, over 850 highway structures and bridges, three tunnels, 5,000 km of footways and 76,000 street trees. In response to significant contractual disputes between BCC and the contractor (which culminated in a Court of Appeal judgment in favour of BCC), BCC sought Government approval for proposed changes to the project agreement. In November 2023, the Government rejected those proposals on the basis they were unaffordable when set against existing spending commitments.

The Court has quashed, on grounds of procedural fairness, the Government’s decision to reject BCC’s proposals. However, the Court dismissed BCC’s main case that it had unlawfully been deprived of a substantive legitimate expectation that Government would continue to pay PFI credits for the remaining 12 years of the project. In reaching that conclusion, the Court concluded that documentation produced by the Government at the time the PFI was entered into did not restrict the Government’s ability to terminate PFI credits only in “exceptional circumstances”.

The Judgment is available here.

Ewan West KC and Will Perry acted for the Secretary of State for Transport.

R (RK) v London Borough of Newham (JR-2023-LON-001029)

In a judgment handed down on 19^th June 2024, Upper Tribunal Judge Reeds found – as a matter of fact – that the Applicant was of his claimed age.

Khatija Hafesji acted for the Applicant, who had arrived to the UK from Iran as an unaccompanied asylum-seeking child in October 2021. He had been assessed by the Respondent, the London Borough of Newham, to be an adult aged between 21 and 25 years, with a likely age of 22.

In April 2023, Khatija successfully obtained interim relief for the Applicant, with the effect that Newham was ordered to treat him in accordance with his claimed age pending the Tribunal’s determination of his claim.

The matter was determined following a five-day fact-finding hearing heard over February and March 2024. It is of note that the Tribunal: (i) accepted that the “short-form” assessment of the Applicant’s age carried out by the Kent Intake Unit should not be afforded “any weight” by the Tribunal either as evidence of the Applicant’s age or as evidence concerning the Applicant’s credibility; (ii) accepted that the Applicant’s failure to produce an identity document should not support an adverse inference against his claimed age in circumstances where he had a genuine fear of contacting his family in Iran; (iii) gave weight to the evidence of RK’s peers and the evidence of the Applicant’s litigation friend; and (iv) accepted the Applicant’s submission that the nature of the his relationship with his social worker, which the social worker conceded in cross-examination was not “a relationship characterised by trust”, was relevant to the weight the Upper Tribunal could attach to her evidence as to the Applicant’s age.

The Tribunal accordingly accepted that the Applicant was of his claimed age.

Khatija Hafesji represented the Applicant and was instructed by Alex McMahon of Osbornes Law Solicitors.

International Distribution Services Limited (formerly Royal Mail plc) has been served with a £878m collective action on behalf of an estimated 290,000 purchasers of bulk mail.

In 2018, Ofcom found that Royal Mail abused a dominant position in 2014 to exclude a competing provider, Whistl, from the market for bulk mail delivery services. Ofcom fined Royal Mail £50m for that conduct. Ofcom’s conclusions and the fine were upheld on appeal by the CAT and Court of Appeal.

The claim is brought on behalf of all persons who purchased or paid for relevant bulk mail services at any time after 10 January 2014. Bulk mail is a type of mail typically sent by organisations such as NHS Trusts, retailers, charities, local authorities, banks, utility companies, advertisers and publishers.  It includes bills, council tax statements, bank statements, charity fundraising appeals, advertising mail and some magazine subscriptions.

Paul Harris KC, Ben Rayment and Will Perry are instructed by Lewis Silkin LLP for the Proposed Class Representative, Bulk Mail Claim Limited.

Mr Robin Aaronson, the PCR’s sole director, was previously a member of the Competition Commission and PostComm.

For press coverage, see The Guardian.