Why not court? A study of follow-on actions in the UK

Abstract

The Department for Business Innovation and Skills introduced a consultation process in April 2012 on ways to facilitate private actions in competition law in the UK. This article makes a timely contribution to this debate by considering the legislative and case-law developments over the past decade in relation to private enforcement of competition law in the UK. In particular, the article focuses on the follow-on action mechanism introduced by the Enterprise Act 2002 whereby damages may be sought by injured parties, relying on prior infringement decisions by the UK competition authorities or the European Commission, before the specialist Competition Appeal Tribunal (CAT). The article notes that there has been relatively little litigation under this mechanism and examines the rationale for continued resort to the traditional High Court litigation route. In addition, the minimal take-up of the consumer representative follow-on action before the CAT is addressed. The article then draws on research undertaken by the author in relation to competition infringement decisions by the UK Office of Fair Trading (soon to be replaced by the Competition and Markets Authority) between 2005 and 2009 and outlines the results of a questionnaire study seeking to understand why aggrieved parties did not seek redress in a follow-on action before the courts or CAT.