VAT Tribunal Publishes its Keenly Awaited Decision in Payment Processing Charges Test Case

The VAT Tribunal has published its decision in the case of T Mobile (UK) Ltd, an appeal against a decision of HMRC concerning the VAT liability of “payment processing” charges levied on customers who do not pay their bills by Direct Debit. T Mobile charges its ‘pay monthly’ customers £3 for each bill which they pay by a method other than Direct Debit or BACS. T Mobile argued that these charges were consideration for supplies of “payment processing services”, and that those supplies were exempt from VAT pursuant to the financial services exemption (Group 5 of Schedule 9 to the Value Added Tax Act 1994).

In recent years, many telecoms and utility companies have introduced payment processing charges in an effort to encourage their customers to pay by Direct Debit. T Mobile’s appeal has been widely seen as a test case for traders seeking to establish that these charges are VAT exempt.

The Tribunal has dismissed the appeal, ruling as follows:

(1) The £3 charge was part of the consideration for T Mobile’s standard rated telecommunications services. There was no separate supply of payment processing services. In the alternative, any supply of payment processing services was ancillary to the supply of telecommunications services and should not be treated separately for VAT purposes.
(2) Even if there had been a separate supply of payment processing services, that supply would not have qualified as an exempt financial service.

Alan Bates represented the Commissioners for HMRC

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Alan Bates

Monckton Chambers Highlighted in The Lawyer’s Annual ‘Top Trials’ Feature

A key telecommunications case featuring seven Monckton barristers has been picked out as one of The Lawyer’s ‘Top Ten Trials’ for 2008.

The case of Orange & Ors v OFCOM & BT, also referred to as ‘Calls to Mobiles’, is addressing the issue of call charges for mobile phones.

The article says, “Calls To Mobiles is the largest of several pieces of litigation relating to call charges this year, including the European case on roaming charges. This particular case will decide whether consumers have been paying too much for their telephone calls. OFCOM believes that this is the case and is looking for phone rates to be slashed.”

Proceedings begin in the Competition Appeal Tribunal at the end of January.

Monckton barristers are involved on all sides:

Peter Roth QC, Josh Holmes and Ben Lask represented OFCOM.
Anneli Howard represented BT

Jon Turner QC and Meredith Pickford appeared for T-Mobile whilst Ben Rayment appeared for the Competition Commission

The full article is available on The Lawyer’s web pages, please click here.

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Jon Turner QC
Ben Rayment
Josh Holmes
Meredith Pickford
Anneli Howard
Ben Lask

The Lawyer’s Hot 100 2008 lists Daniel Beard

Monckton Chambers are proud to announce that Daniel Beard has been listed as one of only three junior barristers to make the The Lawyer’s Hot 100 2008.

The annual supplement identifies members of the legal profession who have excelled in their chosen fields during the past year.

“With European Community Law becoming a vibrant arena within disputes, litigators need a safe pair of hands. They could not do much better than Daniel Beard of Monckton Chambers.

Beard, who was called to the Bar in 1996, is one of the best juniors at the competition and European Bar. One recent victory is testament to that.

Beard took on the might of the European Commission in a case that laid down a precedent that companies in Europe cannot discriminate against contractors. Contractors at Joint European Torus (Jet), the EU’s largest nuclear fusion research project, had not been given the same status as European employees of Jet as they were deemed to have been contracted as third parties.

Beard and fellow Monckton barrister Peter Roth QC won the UK workers £30m in damages. With landmark victories like that, expect Beard to take silk soon.”

Daniel is delighted to be listed in this year’s edition of the Hot 100.

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Daniel Beard QC

Paul Lasok QC Writes for Legal Week

In view of his renowned practice in EC law, Legal Week asked our Head of Chambers, Paul Lasok QC, to share a few thoughts on the current hot topic of an EU referendum.  For more information on this opinion piece, published in the 15th November 2007 issue, see

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Paul Lasok QC

Leading Set Recommendations

Chambers UK continues to highlight us as a leading set for Competition, EU, Procurement, Tax and Telecommunications with further recommendations in Admin & Public Law, Construction, Environment and Sport.

Just a few quotes are “Universally acknowledged to be ‘one of the best sets in the UK’ Monckton Chambers is firmly established as a formidable competition and antitrust powerhouse” and “…One interviewee suggested that ‘the set currently seems to have a real edge, both because of the breadth and depth of the talent and because of its responsiveness” and “Lauded as ‘the specialists’, Monckton Chambers is the most experienced set in the public procurement arena and boasts 16 members with some form of expertise in this area.”

We would like to take this opportunity to thank all our clients for their continuous support. Without them, these recommendations would just not be possible.

Yukos Bankruptcy Liquidator’s Acts Invalidated in the Netherlands

On 31 October 2007 the District Court of Amsterdam gave a landmark judgment on the non-recognition of foreign insolvency proceedings.  The court refused to recognise the authority of a Russian bankruptcy liquidator appointed in respect of Yukos Oil Co to vote the shares of the Yukos’ Dutch subsidiary, Yukos Finance BV.  The court held that huge and unexpected Russian tax assessments were the primary cause of Yukos Oil Co’s bankruptcy in Russia.  The fact that the huge tax assessments were raised unexpectedly, that freezing orders imposed by the Russian courts prevented Yukos from paying them and the unfairness and inadequacy of the procedures for challenging them were unfair contrary to ECHR and general standards of due process.  As a result, the appointment and actions of the Russian bankruptcy liquidator could not be recognised by the Dutch courts on public policy grounds.  The bankruptcy liquidator’s purported dismissal of the previous management of Yukos BV and all other acts undertaken in respect of that Dutch company on his purported authority, were invalid and should be reversed.

Piers Gardner of Monckton Chambers was part of the team, led by NautaDutilh, Amsterdam, instructed by the successful previous management of Yukos Finance BV and by the company.

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Piers Gardner

Court of Appeal Defines Limits of Resident Rights of EU Citizens

In its Judgment of 25th October 2007 the Court of Appeal held that parents with third country national status cannot rely on EC law to claim a right of residence in the UK on the basis that they have a child who is a national of a Member State and a citizen with EU and who can only exercise his right to reside within the EU if he is supported by a parent.

A previous ECJ decision, C-200/02 Chen, held that the UK had to grant a residence to Mrs Chen, a Chinese mother who gave birth to a baby girl in Northern Ireland, on the grounds that the child had acquired Irish nationality and could only exercise her right under Article 18 of the EC Treaty to reside in another Member State if she was with her self sufficient mother.  The Court distinguished the case of Chen on the basis that the Appellants in Mouloungui, Liu, Wang & Ahmed v SSHD could only become self-sufficient if they had access to the UK labour market whereas Mrs Chen was able to fulfil the self-sufficiency requirement without access to the UK employment market.

Christopher Vajda was instructed by the Treasury Solicitor on behalf of the Secretary of State for the Home Department.

The Council of Europe Strengthens the Legal Framework for Civil Society in Europe


In October 2007 the Committee of Ministers of the Council of Europe adopted a Recommendation to member states on the legal status of non-governmental organisations in Europe (CM/Rec(2007)14).

This is the first international legal instrument that targets the legislator, the national authorities and the NGOs themselves.  It aims to recommend standards to shape legislation and practice vis-a-vis NGOs, as well as the conduct and activities of the NGOs themselves in a democratic society based on the rule of law.

The recommendation was adopted to recognise the importance of NGOs in modern society and to elaborate minimum standards for their operation.  Although these standards are observed in many countries, the position of NGOs has been under threat in others and the recommendation gives a better basis for monitoring adverse measures taken in the future.

It is particularly concerned with the legal and fiscal framework required to ensure that NGOs can continue to make their various contributions to public and social life.  Furthermore, it outlines the limitations on objectives and activities that NGOs must observe, particularly those that are anti-democratic or are concerned with the making and distribution of profits.  In addition, it highlights responsibilities that can arise from receiving public support for their activities as well as underlining their responsibility to be transparent and to observe the generally applicable law.

The broadly framed guarantees of freedom of association, other human rights and fundamental freedoms that have been provided in rulings of the European Court of Human Rights and the views of the UN human rights treaty bodies have been built upon in this recommendation.

Implementation of this Recommendation will require member states to take full account of the standards that it sets out in all their legislation, policies and practices that have any bearing on the formation, operation and termination of NGOs.  It will only be fully successful through the widest possible dissemination of the standards set out in it and by training all officials concerned with the activities of NGOs.

So what does this mean? All 47 Council of Europe member states adopted the Recommendation but, unlike an EU Recommendation, there is no specific legal obligation to implement it.  It will, however, be used in arguments before the European Court of Human Rights as to the requirements of the right to freedom of association under the European Convention on Human Rights and will also be used by political bodies such as the Committee of Ministers and the Parliamentary Assembly of the Council of Europe as a basis for assessing state practice and exerting political pressure.

Jeremy McBride was the scientific expert for its preparation.

To view the recommendations, please click here.

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Jeremy McBride



Two Prestigious Awards for our Members

Sir Jeremy Lever KMCG QC received the special award for ‘Lifetime Achievement’ at the Chambers Bar Awards where the spotlight was put on his half century of practice at the Bar: “…Fittingly for a lawyer called in 1957, the Year the Treaty of Rome was signed, he has made his name in the field of Competition and European Law, earning the highest regard from his peers. In 2002, he was knighted for his services to competition law and the EC, one of only three barristers who have been recognised in this way whilst still in practice.  After a successful career acting in many of the major cases of the day, Sir Jeremy retired in 2006.  However, such as the popularity of this enthusiastic, committed, amiable and above all modest advocate, that he was persuaded to return by colleagues, two years later.  Since then, he has continued to add gloss to his reputation by appearing in such matters as Courage v Crehan and Mastercardv OFT. An expert on state aid and a Fellow and Senior Dean of All Souls as well, he continues to display the energy of a man many years his junior and to represent all that is best about the Bar.”

In addition Peter Roth QC shrugged off tough competition and won as ‘Best Silk’ in the Competition/EU award.  They mentioned: “Peter Roth QC has an enviable competition, EU, sports and telecommunications practice conducting an impressive range of cases on behalf of a substantial number of private clients, the OFT and other regulators.  Due to his successful track record, he is a first choice for difficult competition cases such as Attheraces, Floe and adidas.”

Monckton Chambers was also nominated as ‘Set of the Year’ in the Competition/EU section.

European Commission Fines Visa £10.2 million

On 3rd October 2007 the European Commission fined Visa for infringing Art 81 of the EC Treaty and Art 53 of the EEA Agreement.

In 2000 Morgan Stanley complained to the Commission about Visa’s refusal to admit Morgan Stanley Bank (“MSB”) in the UK as a member of Visa.  Visa followed an internal rule of not admitting an applicant which is deemed to be a competitor.

The Commission’s investigation considered this to be a restriction in competition as MSB’s card operations in the EU were confined to issuing MasterCard cards in the UK and its entry into the UK acquiring market (i.e. provision of card acceptance capabilities to retailers) could be expected to have contributed to more efficient competition.  The investigation concluded that it was not a competitor of Visa as it had no payment card network in the EU and that it would be highly unlikely that Discover, Morgan Stanley’s US card network, would expand in the EU given the high entry barriers.

Furthermore, the Commission argued that this rule was also discriminatory as Visa admitted Citigroup and several shareholders of JCB Co Ltd.

A settlement was agreed in 2006 following which MSB withdrew its complaint and was admitted as a Visa member.  Despite this, the Commission decided to impose a fine as Morgan Stanley was excluded for the UK acquiring market for over 6 years.

Visa Europe has indicated that it intends to appeal the decision.

Rupert Anderson QC was part of the legal team for Morgan Stanley and Anneli Howard was junior counsel to Visa.

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Anneli Howard