The Court of Appeal has today handed down its judgment in the BSkyB/ITV litigation,  The outcome is is that the Competition Commission and the Secretary of State for Business Enterprise and Regulatory Reform (both represented by teams from Monckton Chambers) have succeeded on all of the various appeals and cross appeals which were live before the Court.

The case arose from the acquisition by British Sky Broadcasting plc (Sky) in November 2006 of 17.9% of the issued share capital of ITV plc.

The acquisition was referred to the Competition Commission by the Secretary of State under the public interest provisions of the Enterprise Act (the first reference of its kind),  A Competition Commission investigation concluded that a relevant merger situation had been created leading to a substantial lessening of competition.  The Commission recommended that Sky be required to divest itself of enough shares to reduce its holding to below 7.5%.  The Commission however concluded that the merger was not likely to operate against the public interest on grounds relating to media plurality.  The Secretary of State agreed with the Commission’s conclusions on media plurality.

Before the CAT, Sky challenged the Commission’s findings on the competition issues and remedies, and Virgin challenged the findings of the Commission and the Secretary of State on media plurality, focussing on a question of statutory interpretation under the new regime for media mergers. The Competition Appeal Tribunal rejected Sky’s challenge but upheld that of Virgin.

The Court of Appeal has considered the findings of the CAT on both sets of issues with Sky appealing on both competition and plurality grounds, and the Commission and the Secretary of State also appealing on the plurality issue.

In a judgment given by Lloyd LJ, Sky’s appeal against the CAT’s judgment on competition issues was rejected, but the appeals of the Commission, the Secretary of State and Sky on the media plurality issue were upheld.  The result is that the decisions of the Commission and the Secretary of State on competition issues have been upheld and their decisions on plurality have been reinstated.

Paul Lasok QC and Elisa Holmes represented the Secretary of State (now, for Business Innovation and Skills)

John Swift QC, Daniel Beard and Rob Williams represented the Competition Commission

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Paul Lasok QC
John Swift QC
Daniel Beard QC
Rob Williams
Elisa Holmes

The Defendant, Buying Solutions commenced a competitive public procurement to establish a framework agreement for the provision of IT goods and services. The Claimant B2Net Limited, an IT storage company providing companies with hardware and software to improve IT performance, submitted its response with a view to being selected for an invitation to tender (“ITT”).

B2Net Limited was informed that they had been unsuccessful but argued that they had unfairly lost marks because not all their reference contracts involved their acting as prime contractor.

The Judge, Tugendhat J., reviewed the evidence as to the losses that would be suffered if he were to grant of an interim injunction and decided that on balance no interim injunction should be granted.

The Claimant’s application was dismissed.

Michael Bowsher QC and Robert Palmer represented the Defendant, HM Treasury

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Michael Bowsher QC
Robert Palmer

Anneliese Blackwood has just returned to chambers after completing a Pegasus scholarship to Australia.  Anneliese spent the first few weeks in Sydney where she worked with Nicholas Owens, a barrister at Seven Wentworth Barristers’ Chambers. She then spent several weeks with the law firm Mallesons Stephen Jaques in their Melbourne office.  Whilst she was there she worked with partner Natalie Hickey and her team on the Telstra v PDC case which raised the question of whether copyright could subsist in telephone directories.  As some novel legal points emerged in this case Anneliese conducted a considerable amount of research into copyright law across multiple jurisdictions and she attended the hearing of this matter in the Federal Court. Anneliese also assisted partner Chris Fox with work he was doing in connection with the 2009 Victorian Bushfires Royal Commission.

Finally Anneliese spent nearly a month working in the chambers of Chief Justice Black of the Federal Court of Australia.  During this time she was also able to participate in the work of the Australian Competition Tribunal, headed by Justice Finkelstein.

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Anneliese Blackwood

The Claimant, European Dynamics SA, specialises in the delivery of consultancy services for the design, development, maintenance and support of IT applications and software products and it had failed in its attempt to win a place on some framework agreements being set up by Buying Solutions (part of HM Treasury).  It obtained an initial injunction against Buying Solutions, when it appeared on its own just before the end of the “Alcatel” standstill period.  Buying Solutions was successful today in having that injunction discharged when the matter returned to court for a hearing with both parties involved.

Michael Bowsher QC and Elisa Holmes represented the Defendant, HM Treasury.

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Michael Bowsher QC
Elisa Holmes

The hearing in this appeal began to day.  Earlier in the year the Court of Appeal granted permission to Emerald Supplies Limited to appeal against the decision of the Chancellor striking out the representative element of its cartel damages claim against British Airways plc (BA).   In its representative claim Emerald purported to represent all those purchasers of airfreight services who had paid inflated prices as a result of the alleged cartel.

The claim arises in connection with BA’s alleged participation in a cartel in relation to the fixing of fuel surcharges in connection with airfreight services in breach of Article 81 EC.

Ben Rayment is junior counsel to Emerald instructed by Hausfeld LLP.

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Ben Rayment

Monckton Chambers are pleased to announce that a further three tenants have been appointed to the FoI Panel. Ian Rogers, Ben Lask and Alan Bates join George Peretz and Gerry Facenna.  The Treasury Solicitor’s Department set up the specialist panel to act in appeals under the Freedom of Information Act 2000 (FOIA) on behalf of government departments in the summer of 2008.

In addition to their new appointments, all members remain free to act in FOIA appeals for private and other public bodies or interest groups seeking access to information.

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Ian Rogers
Alan Bates
Ben Lask

The Court of Appeal (Criminal Division) has given judgment on the first contested criminal proceedings under the ‘cartel’ offence in section 188 of the Enterprise Act 2002.  The defendant, with others, were senior executives in a major company charged with dishonestly agreeing to effect a price fixing arrangement between their company and a competitor.

The issues in the appeal were whether the cartel offence amounted to a “national competition law” within the meaning of Council Regulation (EC) No 1/2003 (“the Modernisation Regulation”), and, if so, whether the Modernisation Regulation prevents the Crown Court from trying an indictment alleging the cartel offence, or imposing a punishment if it is proved to have been committed, when the Crown Court has not been designated as a National Competition Authority under the Regulation.  The Court of Appeal answered both questions in the negative, and dismissed the appeal by the defendant.

Jon Turner QC and Anneli Howard represented the OFT, together with Richard Latham QC, Mark Lucraft QC and Thomas Payne.

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Jon Turner QC
Anneli Howard

The High Court yesterday dismissed an application by Dŵr Cymru (Welsh Water) for judicial review of Ofwat’s policy on “inset appointments” made under section 7(4)(b) of the Water Industry Act 1991 (“the Act”).

That section allows Ofwat to appoint a new operator to replace the incumbent water and sewerage operator on unserved sites (usually development sites).  Over 20 inset appointments have been made.

Ofwat’s policy is to grant inset appointments to applicants who can show both that they can operate the appointment on a sound financial basis and that consumers on the site will be no worse off than they would be with the incumbent.  Welsh Water argued that that policy was unlawful: in its view, Ofwat was required by the Act to find that an incumbent would offer positive advantages to consumers on the site before it could grant an inset appointment.

In a judgment given orally at the close of argument yesterday, Mr Justice Mitting accepted Ofwat’s evidence that its “no worse off” policy had led to benefits for water customers generally, and held that nothing in the Act precluded that policy.  The Judge also rejected an argument by Welsh Water that Ofwat’s policy failed to comply with social and environmental guidance issued by the Welsh Assembly Government, observing that that guidance could not displace Ofwat’s general duty under the Act to promote competition.

Ofwat was represented by John Swift QC, George Peretz, and Ewan West.  A transcript of the judgment is expected to be available shortly.

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John Swift QC
George Peretz
Ewan West

In October, the OFT published a draft guidance consultation document, “Mergers – Exceptions to the duty to refer and undertakings in lieu”.  The draft proposes significantly to amend the existing guidance on the de minimis exception and also clarifies the OFT’s approach to the assessment of customer benefits.  The undertakings in lieu section contains an important discussion of the upfront buyer mechanism.  The deadline for comments is 15 January 2010.

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Alistair Lindsay

The EU Parliament Committee on the Internal Market and Consumer Protection (IMCO) is currently preparing a report on New Developments in Public Procurement.  It will, apparently be receiving written representations as well as holding a hearing in early 2010.  Topics of concern include issues such as certainty and clarity in the current law, the current state of the law on intercommunal cooperation in light of recent case law, and particularly the application of social, environmental and fair trade criteria.  On this last topic, the podcast recorded earlier this year of a conversation between Joshua Rozenberg, Paul Lasok QC and Michael Bowsher QC addresses some of the current hot issues.

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Paul Lasok QC
Michael Bowsher QC