UK: New Redress for Victims of Competition Law Breaches

Last Updated: 15 May 2003

The Enterprise Act 2002 introduces new possibilities for legal redress for parties who are harmed by infringements of competition law. This has been one of the Government’s stated aims in its overhaul of the UK competition regime. The Government’s objective to make it easier for third parties to bring damages claims against companies who have infringed European or UK competition law is intended to increase the role of third party litigation in competition enforcement.

There are three important changes brought about by the Enterprise Act. They are due to come into force on 20 June 2003.

  • A new procedure allowing for damages claims (or claims for other monetary awards) to be brought directly before the specialist Competition Appeal Tribunal (the "Tribunal") by harmed parties.
  • A new procedure allowing for representative claims to be brought before the Tribunal on behalf of groups of consumers.
  • It will also become easier to bring monetary claims in the UK courts as the Enterprise Act makes infringement decisions by the Office of Fair Trading (OFT) and the Tribunal binding on the courts.

In addition, the Enterprise Act provides for the possibility of transferring cases to and from the Tribunal. Each of these new provisions is explored in more detail below.

Broadly speaking, the result of these changes is that, where companies or consumers are harmed as a result of other companies’ competition law infringements, their chance of obtaining redress is improved. On the other hand, for companies that have infringed competition law, the potential cost of such infringements is likely to increase because, in addition to the prospect of substantial fines, there will also be a greater likelihood of damages awards against them.


Under the current system the Tribunal cannot hear damages claims brought by third parties. This means that such claims have to be brought in the ordinary courts where there has so far not been a single successful damages award for breaches of European competition law or the UK Competition Act (although some cases have led to settlements). This is partly due to the fact that demonstrating liability, causation and quantum of loss can be difficult when bringing an action for damages in respect of competition law infringements in the UK courts.

Bringing a damages claim is expected to become easier through the new monetary claims regime introduced by the Enterprise Act and due to come into force on 20 June. A new section 47A of the Competition Act 1998 introduced by the Enterprise Act will allow such claims to be brought directly before the Tribunal. A claim in the Tribunal should benefit from specialist competition expertise, simplified procedures and a greater flexibility in handling evidence. Also, it is possible that there will be a desire on the part of the Tribunal to encourage such claims. Claimants will be able to bring claims for damages before the Tribunal in relation to both breaches of UK competition law and European competition law.

Further, it remains an option for potential claimants to bring proceedings in the ordinary courts. A claimant will thus have an option of either commencing a claim for damages in the courts or in the Tribunal.


In determining a monetary claim, the Tribunal is bound by any OFT or European Commission decision that established an infringement1 . However, a claim cannot be brought in the Tribunal until there has been such a decision, any appeal has been decided and the time period for bringing further appeals has elapsed or until the further appeals have also been decided. (However, it remains open to claimants to bring proceedings in the ordinary courts prior to such points in time.) The infringement itself will therefore not need to be established before the Tribunal. Instead the Tribunal can focus on whether infringements caused a loss to the claimant and, if so, the amount of any loss.

Retrospective Effect

The new monetary claims regime will have limited retrospective effect, currently envisaged to extend to the last six years (in England and Wales) prior to the date on which section 47A comes into force. The draft Tribunal rules provide that any monetary claim which is not yet time-barred by the time of the commencement of this part of the Enterprise Act (intended to be 20 June 2003) can be brought in the Tribunal in accordance with the new section 47A of the Competition Act. On the basis that the section comes into force as intended on 20 June 2003, the retrospective effect of the new section 47A will be limited (in England and Wales) to the six years prior to that date, i.e. the time period commencing with 20 June 1997.

Requirements to bring a monetary claim

There are six requirements for a claim to come within section 47A of the Competition Act:

  • The claim is for damages or for a sum of money.
  • The claim could be brought in civil proceedings in any part of the UK.
  • The loss or damage results from an infringement of a relevant prohibition. Relevant prohibitions include the Chapter I and Chapter II prohibitions and the prohibitions in Article 81(1) and Article 82 of the EC Treaty.
  • A relevant decision has established such an infringement. Relevant decisions include Chapter I or Chapter II infringement decisions by the OFT, decisions by the OFT that Article 81 or 82 has been infringed, decisions from the Tribunal that the Chapter I or Chapter II prohibition or Article 81 or 82 has been infringed and decisions of the European Commission that Article 81 or 82 has been infringed.
  • The period for appealing the relevant decision has elapsed or, where the decision is already subject to an appeal, that the appeal has been determined and is no longer subject to further appeal. The Tribunal may give written permission to bring the claim regardless of the state of appeals from the relevant decision.
  • The time limit for making a claim for damages set out in the Tribunal rules has not expired. The draft Tribunal rules provide for a limitation period of two years commencing with later of either (a) the date on which the cause of action accrued (usually when the loss was suffered) or (b) when the period for appealing the relevant decision has elapsed (or, where the decision is already subject to an appeal, when the appeal is decided and no longer subject to further appeal).2

This means that companies that have been found in breach of competition law may remain subject to the possibility of claims for damages in the Tribunal for a considerable period of time.

Damages Awards

The Tribunal will apply the same principles as would be applied by a court in awarding damages: damages can be claimed for losses caused by the infringement. Thus, the new UK regime has not gone down the route of US style punitive treble damages 3 . Nonetheless, in practice UK damages awards may well be substantial. This is because the UK system allows for interest on damages awards pre-judgment whereas the US system does not. As it can be expected that long periods of time will elapse between the relevant infringement and a Tribunal judgment, the interest on damages is likely to prove a significant part of any award.4

Enforcement of Tribunal decisions will be carried out by registering them with the High Court. There is also a new right of appeal from such Tribunal decisions to the Court of Appeal (or the Court of Session from Tribunal proceedings in Scotland) against the award of damages (or other sum) or against the amount of such damages (or other sum).


The Enterprise Act further introduces provisions allowing representative claims for damages to be brought on behalf of consumers. Such claims for damages may be brought by specified bodies on behalf of a group of named individual consumers under the new section 47B of the Competition Act 1998 introduced by the Enterprise Act.

The new procedure may also be utilised in respect of indirect purchasers. An example of a situation where such a claim could be brought would be where a number of consumers bought, for their own use, goods whose price has been inflated by a price-fixing agreement either among the suppliers themselves, or the manufacturers, or possibly among the manufacturers’ own suppliers. Absent the new provision, such purchasers would not be likely to bring a claim since their individual loss is likely to be small.

The Government has stated that the purpose of allowing these consumer claims is to provide an economical and effective mechanism for enabling consumers to obtain redress in such cases and to further deter companies from infringing the law. The new procedure therefore facilitates so-called class actions.

Who can be a specified body?

In order to be designated as a ‘specified body’ to bring claims on behalf of consumers, an organisation has to meet criteria published by the Secretary of State and apply to her to be so designated in a Statutory Instrument.

The criteria to be specified to bring claims on behalf of consumers are as follows:

  • The body is so constituted, managed and controlled as to be expected to act independently, impartially and with complete integrity.
  • The body is able to demonstrate that it represents and/or protects the interests of consumers. This may be the interests of consumers generally or specific groups of consumers.
  • The body has the capability to take forward a claim on behalf of consumers.
  • The fact that a body has a trading arm will not disqualify it from being able to bring consumer group claims, provided that the trading arm does not control the body, and any profits of the trading arm are only used to further the stated objectives of the body.

The Secretary of State has provided guidance on the sort of evidence that should be submitted by applicants in relation to each of these criteria. Applications will be published on the DTI website for a period of 12 weeks to facilitate a transparent application process.

Requirements to bring consumer claims

The requirements for a claim to come within section 47B of the Competition Act are that:

  • The claim is brought by a specified body.
  • The claim is brought on behalf of two or more consumers. Consumers are individuals who received goods or services, or sought to receive them, otherwise than in the course of a business, notwithstanding that this was with a view to carrying on a business.
  • The goods or services were supplied, or would have been supplied, to the consumers in the course of a business carried on by the person who supplied or would have supplied them. A business includes a professional practice, any other undertaking carried on for gain or reward and any undertaking in the course of which goods or services are supplied otherwise than free of charge.
  • The individual consumers consent to the specified body pursuing their claims.
  • The individual consumers’ claims are based on the same infringement of a relevant prohibition.
  • The requirements for bringing a claim under section 47A as set out above are fulfilled.

Provided these conditions are met, it is also possible for existing claims by individual consumers to be taken over by a specified body and dealt with together.

Damages Awards

The Tribunal’s function in relation to these consumer claims will be to determine entitlement, and assess and award damages, to the consumers. Any damages will either be ordered to be paid directly to the represented consumers for them to enforce, or alternatively, if both the specified body and the represented individuals consent, the Tribunal will order the sum awarded to be paid to the specified body who will then enforce the award on behalf of the individual consumers.

Assessing and awarding damages will clearly be complex. This will especially be the case in the context of claims brought by indirect purchasers where proving causation and damage through the chain of distribution can be expected to be difficult. There is some suggestion that the Tribunal could look at the Defendant’s gain for the purpose of assessing damages. However, such an assessment would not necessarily give an accurate reflection of the claimants’ loss. For example, in the case of indirect purchasers it will not be clear how much of the Defendant’s extra gain was actually passed on to the indirect purchaser through the chain of distribution.

The procedures for enforcing and appealing these Tribunal decisions are the same as in relation to individual monetary claims as set out above.


The Enterprise Act also makes previous findings of infringements by the OFT and the Tribunal binding in the courts for the purposes of subsequent claims for damages. Whereas currently the OFT’s findings of fact are prima facie binding on the parties under section 58 of the Competition Act, a new section 58A will in addition make findings of infringements binding on the courts. The relevant infringements are breaches of the prohibitions in Chapter I and Chapter II of the Competition Act and breaches of the prohibitions in Article 81 and Article 82 of the EC Treaty.

This new provision will therefore make it easier for claimants to bring damages claims in the UK courts against companies who have infringed European or UK competition law. However, unlike the new section 47A, the new section 58A has no retrospective effect and thus only applies in respect of infringement decisions made after 20 June 2003. This means that, where claimants wish to rely on a decision taken by the OFT or the Tribunal prior to that date, they need to bring their monetary claim directly before the Tribunal as those rules apply retrospectively (albeit only to a limited extent, as outlined above).

The Enterprise Act also provides for the transfer of claims to and from the Tribunal. Transfers from the Tribunal to the English or Scottish courts can be undertaken at any stage of the proceedings on the request of a party or of the Tribunal’s own initiative. Similarly, claims which could have been made under section 47A of the Competition Act can be transferred to the Tribunal from any court in accordance with the rules of court or any practice direction. It can only be speculated at the moment how, and to what extent, use will be made of such transfers. A potential example would be where a question of competition law forms part of a wider commercial dispute. In such a situation, a party to the dispute could request a transfer of the discrete competition law issue to the Tribunal if it considers the Tribunal best placed to evaluate, for example, complex economic data in question.


  1. Section 58 of the Competition Act as it currently stands provides for the OFT’s findings of fact to be prima facie binding on the parties to court proceedings. The Enterprise Act extends this provision in a new section 58A making findings of infringements binding on the courts for the purposes of monetary claims. This is discussed in more detail below.
  2. It can be expected that in most cases the cause of action will have accrued before the date on which the relevant decision is no longer subject to appeal. In most claims, therefore, the relevant starting point for the purpose of the limitation period is likely to be when a relevant decision is no longer subject to appeal. However, there may be situations where the course of action arises at a later stage, for example, where the claimant is an indirect purchaser and the loss occurs after the infringement decision. In such situations, the limitation period will then run from this later date.
  3. Although it is at least arguable that even under English law at present courts could award exemplary damages for blatant competition law infringements, where compensation would be an inadequate remedy to punish outrageous conduct.
  4. The Competition Commission Appeal Tribunal addressed the question of interest generally in its Napp Pharmaceuticals decision of 6 February 2002. It ordered interest to be paid at Bank base rate plus 1 per cent. Whilst this decision concerned the rate of interest to be applied to a penalty, which the Tribunal stated was designed to prevent the undertaking subject to a penalty from obtaining any benefit from the delay inherent in the appeal process, the same principle could also be said to apply to an undertaking that benefited from its anti-competitive behaviour.
  5. The Competition Commission Appeal Tribunal stated in its decision of 15 January 2002 in Napp Pharmaceuticals: " We sympathise with the Director’s intentions in increasing the penalty, at Step 3 of his calculation, by an amount representing Napp’s ‘gain’ during the period of the infringement, in accordance with the Director’s Guidance (see paragraph 260 of the Decision). However, in our view that approach presents certain difficulties. […] This method of calculation, so it seems to us, is more suited to the process for assessing damages in civil litigation, rather than the fixing of a deterrent penalty."

By Kim Dietzel

© Herbert Smith 2003

The content of this article does not constitute legal advice and should not be relied on as such. Specific advice should be sought about your specific circumstances.

For more information on this or other Herbert Smith publications, please email us.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.