Success in First Telecoms Dispute Case in Court of Appeal

26 Jul 2012 | by Caroline Sweeney

Telefonica O2 UK Ltd, Everything Everywhere Ltd, Vodafone Ltd and Hutchison 3G UK Ltd v BT PLC and Ofcom

The Court of Appeal has today decided that the Competition Appeal Tribunal took the wrong approach in considering appeals against determinations made by Ofcom in disputes between BT and the major mobile telephone network operators (“MNOs”).

The disputes related to the prices charged by BT to MNOs for connecting calls to 0800, 0845 and 0870 numbers hosted on its network. Ofcom had found that there was a risk that the new charging structure proposed by BT would lead to a detriment to consumers. However the Tribunal overturned Ofcom’s determinations in August 2011, finding that Ofcom had failed to pay due regard to BT’s contractual rights and that, in the absence of specific ex ante regulatory conditions, Ofcom should not intervene unless consumer detriment could “clearly and distinctly” be shown. On an appeal by the MNOs, the Court of Appeal has now decided that the Tribunal’s approach was wrong in principle: BT’s contractual rights to vary prices were not a relevant factor once a dispute had been referred to Ofcom; dispute resolution is part of Ofcom’s regulatory responsibility for ensuring interconnectivity; and the Tribunal had been wrong to adopt the presumption in favour of non-intervention.

This is the first case in which the Court of Appeal has considered the approach which Ofcom should adopt to deciding disputes under s.185 Communications Act 2003.

Jon Turner QC and Philip Woolfe appeared for Vodafone Limited, Everything Everywhere Limited and Hutchison 3G UK Limited.

Click to view the judgment in Telefonica O2 v BT and Ofcom