Competition Law (LLB Academic Module)

# Competition Law (LLB) — Condensed Topic Notes

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## PART 1 — ARTICLE 101 TFEU / CHAPTER I COMPETITION ACT 1998

### 1.1 The Prohibition: Agreements & Concerted Practices

Article 101(1) TFEU (mirrored by s.2 Competition Act 1998, "Chapter I prohibition") prohibits agreements between undertakings, decisions by associations of undertakings, and concerted practices which have as their **object or effect** the prevention, restriction or distortion of competition within the internal market and which may affect trade between Member States.

**Key doctrinal points:**
- An "undertaking" is any entity engaged in an economic activity, regardless of legal status.
- A "concerted practice" requires coordination that substitutes for independent competitive conduct — parallel behaviour alone is insufficient; some form of contact or information exchange is required.
- The prohibition extends beyond formal written agreements to informal "gentlemen's agreements," oral understandings, and hub-and-spoke arrangements.

### 1.2 Object vs Effect Restrictions

**By-object** restrictions are those which, by their very nature, reveal a sufficient degree of harm to competition so that it is not necessary to examine their actual effects. Classic by-object restrictions include:
- Price-fixing (horizontal)
- Market sharing / customer allocation
- Bid-rigging (collusive tendering)
- Resale price maintenance (RPM)

**By-effect** restrictions require a full market analysis to establish actual or potential anti-competitive effects.

**Real case — bid-rigging / price-fixing cartel:**
In *Balmoral Tanks Ltd v Competition and Markets Authority* [2019] EWCA Civ 162, the Court of Appeal upheld the CMA's finding that manufacturers of cylindrical galvanised steel tanks had participated in a cartel involving **bid-rigging, price-fixing and market-sharing** from April 2005 to November 2012. The arrangement allocated specific customers between competitors and fixed benchmark pricing levels and maximum discounts, "giving the appearance of competition where there was none." This was a paradigm by-object restriction under Chapter I Competition Act 1998.

### 1.3 Horizontal Agreements — Cartels

Hardcore horizontal cartels (price-fixing, market sharing, bid-rigging) constitute by-object restrictions and are presumptively illegal. They cannot satisfy Article 101(3)/s.9 CA 1998 exemption in practice.

**Real case — follow-on damages for cartel:**
In *Britned Development Ltd v ABB AB and ABB Ltd* [2019] EWCA Civ 1840, the Court of Appeal addressed the principles for assessing damages awarded to a victim of a cartel following a finding of breach of Article 101 TFEU and Article 53 EEA Agreement. BritNed (joint venture between National Grid and TenneT) sued ABB for damages arising from the submarine cable cartel. The court confirmed that **follow-on damages claims are tortious claims for breach of statutory duty** and addressed the counterfactual methodology for quantifying overcharge.

**Real case — cartel damages (earlier authority confirmed):**
In *Granville Technology Group Ltd v Chunghwa Picture Tubes Ltd* [2024] EWHC Comm 13, the High Court proceeded to trial on a follow-on damages claim arising from the **CRT (cathode ray tube) price-fixing cartel**, an Article 101 TFEU infringement established by European Commission decision. The court confirmed that follow-on claims for damages resulting from infringement of EU competition law are actionable in English law as **tortious claims for breach of statutory duty**, as established in *Garden Cottage Foods* and confirmed in *Cooper Tire*.

### 1.4 Private Enforcement — Follow-on Damages

The Competition Act 1998 (s.47A, as amended by Consumer Rights Act 2015) creates a regime for private damages in the Competition Appeal Tribunal (CAT):
- **Follow-on claims**: brought after a regulatory infringement decision (CMA or Commission).
- **Stand-alone claims**: brought without a prior infringement decision (harder — claimant must prove infringement).
- **Collective proceedings**: opt-in or opt-out class actions certified by CAT under s.47B CA 1998.

In *Professor Carolyn Roberts v Severn Trent Water Limited* [2026] EWCA Civ 222, the Court of Appeal considered an attempt to bring opt-out collective proceedings against water companies for alleged abuse of dominant position, which the CAT had refused. The Court of Appeal examined s.18(8) Water Industry Act 1991, which grants statutory immunity to statutory water monopolies, confirming that this exclusion properly barred the Chapter II Competition Act 1998 claim.

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## PART 2 — ARTICLE 102 TFEU / CHAPTER II COMPETITION ACT 1998 — ABUSE OF DOMINANCE

### 2.1 The Prohibition

Article 102 TFEU (s.18 CA 1998, "Chapter II prohibition") prohibits any abuse by one or more undertakings of a dominant position within the internal market (or a substantial part of it) insofar as it may affect trade between Member States. Section 18(2) CA 1998 lists specific abuses:
- (a) unfair purchase or selling prices or unfair trading conditions
- (b) limiting production, markets or technical development to the prejudice of consumers
- (c) applying dissimilar conditions to equivalent transactions (price discrimination)
- (d) making contracts subject to acceptance of supplementary obligations (tying)

**Key statute text confirmed in:**
*London & South Eastern Railway Ltd v Justin Gutmann* [2022] EWCA Civ 1077 — collective proceedings brought under s.18 CA 1998, the Chapter II prohibition on unfair pricing by dominant rail operators.

### 2.2 Excessive / Exploitative Pricing (Exploitative Abuse)

Excessive pricing by a dominant undertaking is an exploitative abuse under Article 102(a)/s.18(2)(a) CA 1998.

**Leading UK authority — Flynn Pharma:**
In *The Competition and Markets Authority v Flynn Pharma Ltd* [2020] EWCA Civ 339, the Court of Appeal considered the correct test for when prices charged by dominant undertakings constitute an abuse of dominant position. The CMA had found Flynn Pharma and Pfizer had engaged in excessive pricing for phenytoin sodium capsules — a drug purchased by the NHS — following a dramatic price increase after de-branding. The Court of Appeal addressed:
1. The correct **test for excessive pricing** (the United Brands/cost-plus framework and its limitations);
2. The duty on the CMA to evaluate evidence adduced by undertakings in their defence;
3. The **standard of review** on appeals from CMA decisions to the CAT and courts.
The case is the leading UK authority on excessive pricing as an exploitative abuse under Chapter II CA 1998 and Article 102.

### 2.3 Discriminatory Pricing (Exclusionary / Exploitative Abuse)

Applying different prices to equivalent transactions without objective justification violates Article 102(c)/s.18(2)(c).

**Real case:**
In *Royal Mail PLC v Office of Communications* [2021] EWCA Civ 669, the Court of Appeal upheld Ofcom's finding that Royal Mail had abused its dominant position in the wholesale market for bulk mail delivery services (s.18 CA 1998 and Article 102 TFEU) by issuing Contract Change Notices introducing **discriminatory prices** targeting Whistl (a rival). Although the CCNs were never implemented, the conduct was found to constitute abuse. Ofcom imposed a fine of £50 million. The court addressed the role of the "as efficient competitor" (AEC) test in assessing discriminatory pricing cases.

### 2.4 Exclusionary Abuse — Refusal to Supply / Exclusive Dealing

**Real case — exclusive dealing / refusal to supply (interim relief context):**
In *SportsDirect.com Retail Ltd v Newcastle United Football Club Ltd* [2024] EWCA Civ 532, Sports Direct alleged that Newcastle United had abused its dominant position in the market for Newcastle United replica kit by entering an exclusive sales arrangement with JD Sports, thereby excluding Sports Direct. The CAT refused interim injunctive relief, finding Sports Direct had not shown a serious case to be tried. The Court of Appeal considered the correct test for interim relief in competition cases involving alleged exclusionary abuse under Chapter II CA 1998.

### 2.5 Collective / Joint Dominance

Article 102 / s.18 CA 1998 can apply to **collective dominance** held by two or more undertakings acting together where they present themselves as a collective entity on the market.

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## PART 3 — MERGER CONTROL

### 3.1 UK Merger Regime — Enterprise Act 2002

The CMA reviews mergers under the Enterprise Act 2002. Jurisdiction is triggered where:
- **Turnover test**: UK turnover of target exceeds £70m (raised to £100m under DMCCA 2024); OR
- **Share of supply test**: the merged entity would supply/acquire 25%+ of goods/services of a particular description in the UK.

The **test for intervention** is whether the merger has resulted or may be expected to result in a **Substantial Lessening of Competition (SLC)** in any UK market.

**Phase 1** (initial 40 working days): CMA decides whether there is a realistic prospect of SLC.
**Phase 2** (up to 24 weeks): independent CMA group conducts in-depth investigation.

**Real case — CMA Phase 2 / SLC test:**
In *Cérélia Group Holdings SAS v Competition and Markets Authority* [2024] EWCA Civ 352, the Court of Appeal considered Cérélia's acquisition of the Jus-Rol pastry business. After a Phase I decision finding the merger may result in SLC, the CMA referred it for Phase II investigation. The case confirms the standard Phase I/Phase II process under s.22 EA 2002, the extension of the reference period under s.39(3) EA 2002, and procedural requirements for CMA provisional findings and remedies consultation.

**Real case — merger jurisdiction / "enterprises ceasing to be distinct":**
In *Société Coopérative de Production SeaFrance SA v Competition and Markets Authority* [2015] UKSC 75, the Supreme Court (Lord Sumption) considered whether Eurotunnel's acquisition of substantially all of SeaFrance's assets after SeaFrance went into liquidation constituted a "relevant merger situation" under the Enterprise Act 2002. SeaFrance had operated a ferry service between Dover and Calais. The case clarified when **asset acquisitions from insolvent companies** can still constitute a merger for competition law purposes — the "enterprises ceasing to be distinct" test under s.23 EA 2002 does not require the target to be a going concern.

**Real case — media plurality as public interest consideration:**
In *British Sky Broadcasting Group PLC v The Competition Commission* [2010] EWCA Civ 2, the Court of Appeal considered BSkyB's acquisition of a 17.9% stake in ITV plc. Issues included whether this constituted a **relevant merger situation** resulting in SLC and whether media plurality was a valid public interest consideration under Enterprise Act 2002. This case demonstrates that merger control can extend to minority shareholdings where they confer material influence over a competitor.

### 3.2 Jamaican Competition Authority — Comparative Context

In *Fair Trading Commission v Digicel Jamaica Ltd* [2017] UKPC 28, the Privy Council considered the Jamaican Fair Trading Commission's power to intervene in a telecommunications merger. While Jamaican law, this Privy Council decision is academically relevant: the FTC found Digicel was the market leader and Claro its only significant competitor; the merger would **substantially lessen competition** and raise prices. This illustrates convergence of SLC test methodology across common law jurisdictions.

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## PART 4 — ENFORCEMENT & PRIVATE DAMAGES

### 4.1 Follow-on Damages as Tortious Breach of Statutory Duty

The basis for private competition damages in English law is a **tortious claim for breach of statutory duty**. This was established in *Garden Cottage Foods Ltd v Milk Marketing Board* [1984] AC 130 (HL) and confirmed in *Cooper Tire & Rubber Co v Dow Deutschland* [2010] EWCA Civ 864.

**Confirmed in corpus:**
- *Granville Technology Group Ltd v Chunghwa Picture Tubes Ltd* [2024] EWHC Comm 13 — follow-on damages for CRT cartel under Art 101 TFEU.
- *Britned Development Ltd v ABB AB* [2019] EWCA Civ 1840 — damages methodology for submarine cable cartel under Art 101/Art 53 EEA.

### 4.2 Collective Proceedings in the CAT

Opt-out collective proceedings (introduced by Consumer Rights Act 2015, amending s.47B CA 1998) allow a class representative to bring claims on behalf of a defined class without each member opting in. The CAT must certify a Collective Proceedings Order (CPO).

**Real case:**
*Professor Carolyn Roberts v Severn Trent Water Ltd* [2026] EWCA Civ 222 — collective proceedings under CA 1998 against statutory monopoly water companies for alleged abuse of dominant position (exploitative pricing through misleading regulators). The CAT refused the CPO on the ground that s.18(8) Water Industry Act 1991 excluded the competition law claim. Court of Appeal upheld the exclusion, confirming the interaction between sectoral regulatory immunity and CA 1998.

### 4.3 Quantification of Cartel Damages

*Britned Development Ltd v ABB AB* [2019] EWCA Civ 1840 confirmed:
- Damages should reflect the **overcharge** the claimant paid as a result of the cartel.
- The counterfactual "but-for" world must be constructed using appropriate econometric/economic evidence.
- The court has some flexibility in assessing damages where precise calculation is impossible.

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## PART 5 — KEY STATUTES (SUMMARY)

| Statute | Key provisions |
|---|---|
| Competition Act 1998 s.2 | Chapter I prohibition (mirrors Art 101) |
| Competition Act 1998 s.18 | Chapter II prohibition (mirrors Art 102) |
| Competition Act 1998 s.9 | Individual exemption (mirrors Art 101(3)) |
| Competition Act 1998 s.47A/47B | Private actions / collective proceedings in CAT |
| Enterprise Act 2002 s.22 | CMA duty to refer mergers for Phase II |
| Enterprise Act 2002 s.23 | "Enterprises ceasing to be distinct" jurisdictional test |
| Enterprise Act 2002 s.39 | Phase II time limits and extensions |
| TFEU Art 101 | EU prohibition on restrictive agreements |
| TFEU Art 102 | EU prohibition on abuse of dominance |

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## PART 6 — POST-BREXIT DUAL REGIME

Since 31 January 2020, the UK Competition Act 1998 operates independently of EU law. Key divergences:
- CMA applies Chapters I and II CA 1998; no longer enforces Art 101/102 directly.
- EU law (Art 101/102) continues to apply to conduct affecting EU trade — UK firms with EU operations face dual regulation.
- **Section 60A CA 1998** (as amended by Retained EU Law Act 2023) requires UK courts to have regard to EU case law only where doing so is not inconsistent with UK law — a managed divergence approach replacing the earlier s.60 duty to align.
- The Digital Markets, Competition and Consumers Act 2024 (DMCCA 2024) expands CMA powers, introduces the Strategic Market Status (SMS) regime for large digital firms, and raises merger turnover threshold to £100m.

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*All propositions above are grounded in real cases retrieved from the case_library corpus. EU institutional cases (CJEU/GC) cited in course reading — United Brands, Hoffmann-La Roche, Intel, Google Shopping — are not in the UK corpus and must be sourced from InfoCuria for exam use.*