Government plans to simplify procedures for taking collective legal action against price fixing and other anti-competitive behaviour have received a mixed reception.
The measures, announced today, include making the Competition Appeal Tribunal the main court for competition actions and introducing a new opt-out regime for collective actions under competition law.
Michael Sanders, partner at magic circle firm Linklaters, described the package as ‘a broadly sensible compromise between the interests of claimants and defendants’.
However the Confederation of British Industry (CBI) condemned the proposals for collective actions as fueling a ‘litigation culture’.
Katja Hall, chief policy director, said: ‘The government has let the litigation genie out of the bottle by adopting US-style collective actions. It is absolutely right that victims of competition law breaches are properly and swiftly compensated but there are better ways to do this than resorting to litigation, like using alternative dispute resolution.’
The new measures were announced in the government’s response to a consultation ‘Private Actions in Competition Law’, which proposed improving the way the UK helps individuals or businesses challenge anti-competitive practices in court.
- Making the Competition Appeal Tribunal the main court for competition actions in the UK, with a new fast-track regime. Establishing the tribunal as the main competition court will allow it to hear more cases and swiftly resolve disputes for consumers and businesses.
- Introducing a new opt-out collective actions regime, with protections, for competition law. Under the new regime, ‘appropriate representative bodies’ will be able to take a group or collective action in court, and groups of consumers or businesses will automatically be included in the action. If they do not want to be part of the claim they will have to opt out.
- Promoting alternative dispute resolution ‘to make sure that wherever possible any disputes are resolved without resorting to courts’. Businesses that have had claims made against them will be able to propose collective settlements to the tribunal.
Jo Swinson, the competition minister, said: ‘Businesses who want to voluntarily offer compensation will be able to do so through collective settlement and will be protected from expensive and lengthy legal action.’