In the latest instalment of a continuing series, we offer advice on the issues that face solicitor-advocates

Solicitor Advocates have a number of new opportunities in the competition law field under the Enterprise Act 2002, through its amendments to the Competition Act 1998.

First a new 'cartel offence' has been introduced into criminal law.

Second, there is a new right to sue competition law infringers for damages in the Competition Appeal Tribunal (CAT) in reliance on Office of Fair Trading (OFT) or EC Commission decisions, once any appeal has failed or the time for appealing has passed.

Third, a new right to challenge (akin to judicial review) merger decisions of the Office of Fair Trading (OFT), Competition Commission and secretary of state.

There is also a new provision for 'class action' complaints to the OFT by representative bodies such as the Consumers Association, which may result in appeals to the CAT by the aggrieved class-action body.

Criminal relevance

The OFT, which will implement its powers to investigate and prosecute with the Serious Fraud Office (SFO), has made it clear that it is not planning to rush in where angels fear to tread.

However, the Police and Criminal Evidence Act, the Human Rights Act and the Criminal Justice Act will all apply in the police station, the SFO's interview room and Crown Court, just as in any other criminal case.

The OFT says that it is totally re-organising its investigatory process so that it can satisfy the criminal procedure and evidence standards, even in civil cartel cases.

All documents will be docketed and kept under lock and key to avoid accusations of tampering with the evidence.

Maximum prison sentences of five years for cartelists apply in jury trials.

The cartel offence is limited to price fixing, market sharing and bid-rigging agreements and arrangements if 'dishonesty' (as defined by the Court of Appeal in R v Ghosh [1982] QB 1053, CA) can be proved.

In addition, there are likely to be disputes over the new draconian powers of surveillance made under the Regulation of Investigatory Powers Act 2000.

Advocates will need experience in criminal practice to outmanoeuvre the SFO and OFT.

Civil relevance

The cause of action underlying a claim for damages against a competition infringer who is the addressee of an OFT (or EC Commission) decision is breach of statutory duty (Garden Cottage Foods Limited v Milk Marketing Board [1983] 2 ALL ER 770, HL, at pages 775-776; and section 60 CA 98).

To encourage the private enforcement of competition law by parties harmed by infringements, two avenues have been made available by the Enterprise Act 2002.

First, section 58A CA 98 added by section 20 of the Act to the existing section 58 CA 98, removes any doubt that a decision of the OFT applying either of the CA 98 prohibitions (chapter 1 prohibition of restrictive agreements and/or chapter 2 prohibition of abuse of dominance), or a decision by the OFT applying the equivalent articles 81 and 82 EC Treaty prohibitions (after 1 May 2004 when enforcement is decentralised from Brussels to the OFT), will be binding on any court in which a civil claim for damages is brought.

Second, and more importantly, section 47A CA 98 introduced by section 18 CA 2002 provides a new right to damages before the CAT.

When determining a claim for damages under section 47A, the tribunal is bound by a decision of the OFT establishing a chapter 1 or chapter 2 CA 98 prohibition infringement or an infringement of the article 81 or article 82 prohibitions as well as infringement decisions of the European Commission.

The tribunal will be bound by those decisions that establish that the prohibition in question has been infringed, provided that any appeal has been unsuccessful or that the time-limit for appealing is expired.

Section 47A applies to claims arising before the commencement of section 47A as well as those arising after that date (20 June 2003).

Consequently, all the general principles of English tort law applicable to breach of a statutory duty will be applicable to claims for damages before the courts and the CAT.

(A similar approach will apply to EC competition infringement decisions since section 47A CA 98 does not distinguish between decisions of the EC Commission and those of the OFT.

European Community law itself requires national procedures and remedies to be applied by the English courts subject to the general principles of non-discrimination and effectiveness established by the European Court).

Damages claims are already in the pipeline.

Public law relevance

On 3 December 2003, the CAT delivered its first judgment granting an application for review of an OFT decision not to refer a merger to the Competition Commission - Office of Fair Trading and others v IBA Healthcare Limited [2003] CAT 28.

Although on appeal to the Court of Appeal following permission to appeal granted by the CAT on 19 December 2003, this case illustrates how judicial review could develop.

The CAT says that it has merely reviewed whether the OFT applied the statutory test in section 33(1) of the Enterprise Act 2002 and found that the OFT had acted unreasonably in the sense that it had failed to state adequately its reasons for deciding not to refer a merger when it could not rule out an alternative view to its own that the creation of a relevant merger situation 'may be expected to result in a substantial lessening of competition'.

Section 120A (4) of the Act provides that the CAT must apply the same principles that would be applied by a court on an application for judicial review.

According to the explanatory notes to the Enterprise Act 2002, the case law suggests that grounds of review could include what some might consider controversial issues such as 'material error as to the facts' or that there was 'some other material illegality (such as unreasonableness or lack of proportionality)'.

If the CAT is upheld by the Court of Appeal, English administrative law may recognise broader grounds of judicial review in line with the action for annulment under article 230 EC Treaty applied by the European Court of First Instance, which is where Sir Christopher Bellamy QC sat before becoming the president of the CAT.

This column was prepared by the Solicitors' Association of Higher Court Advocates.

For details of SAHCA or for a membership application form, tel: 020 7837 0069.

E-mail advocacy questions to: sandra@admin4u.org.uk