Competition Appeal Tribunal

Subscribe to Competition Appeal Tribunal via RSS

The CAT’s specific disclosure ruling addresses the use of licensing to support anticompetitive behaviour.

By John D. Colahan and Calum M. Warren

On 2 March 2018, the Chairman of the UK Competition Appeals Tribunal (CAT) granted an application for further specific disclosure in Peugeot S.A. and others v NSK Ltd and others. The disclosure relates to certain licensing arrangements claimed as central to the claimants’ action for damages arising out of anticompetitive practices, for which the European Commission (Commission) fined the defendants in March 2014. The ruling highlights the potential misuse of licensing arrangements to support anticompetitive behaviour, and is a timely reminder of the need for caution when dealing with counterparties in licensing arrangements.

In February 2016, the claimants — Peugeot S.A. and 18 other companies within the Peugeot Citroën group — brought an action for damages before the CAT. The claim was a so-called “follow-on” action based on a Commission decision of 14 March 2014. The defendants — competing suppliers of components to automotive original equipment manufacturers (OEMs) known as automotive bearings — were found to have coordinated pricing strategy in relation to automotive OEMs in the EEA, and received fines totalling approximately €953 million. In particular, the defendants were found to have coordinated their responses to customers’ (including the claimants’) requests for quotations (RFQ), including which undertakings would submit a quote to a given RFQ.

By Hayley Pizzey

The Competition Appeal Tribunal (CAT) has ordered MasterCard Incorporated (MasterCard) and others to pay £68.6 million in damages to Sainsbury’s Supermarkets Ltd (Sainsbury’s). The CAT held that MasterCard restricted competition by setting UK Multilateral Interchange Fees (MIFs) between December 2006 and December 2015 (the ‘relevant period’). This judgment represents the largest damages award handed down by CAT, and the final damages award may reach £90 million once interest is added.

90% of the damages related to MIFs, processing fees charged to retailers by MasterCard for MasterCard credit and debit card transactions between the customer and retailer. The CAT considered that if MasterCard had not set MIFs, banks would have agreed lower bilateral interchange fees. The damages reflect the difference between MasterCard’s MIF rates and the lower bilateral fees which would have been paid, over the relevant period.

There are two novel issues that were examined in the judgment: (i) the pass on defence and the causal link; and (ii) the calculation of interest. Each of these is considered below.

The judgment is also the first time the CAT has awarded damages in an Article 101 TFEU[1] claim and the first ‘stand-alone’ competition judgment.

By Jumana Rahman

The Consumer Rights Act 2015 entered into force on 1 October 2015. The Act develops the law on private enforcement of competition law infringements, in a radical manner.

Previously, the Competition Appeal Tribunal (CAT) could only hear collective actions in reasonably limited circumstances, as such actions could only be brought on an opt-in basis, ie where claimants had to expressly assert class membership to be part of the proceedings. The new Consumer Rights Act introduces an opt-out procedure, which makes it easier to bring claims with large numbers of claimants claiming smaller individual losses.