UK Consumer Rights Act 2015 Ushers in Class Action-Style Collective Proceedings Regime in the Competition Appeals Tribunal

October 2, 2015

​The UK Consumer Rights Act 2015 ("the CRA") came into force on 1 October 2015, fundamentally transforming the cartel claims environment in the UK, and introducing class actions (as US litigators might understand the term) for the first time to English law.

Schedule 8 of the CRA creates a new collective proceedings regime for damages claims before the Competition Appeals Tribunal ("the CAT"). The regime will not be available for claims in the High Court, even if they could also be brought before the CAT.  

Under the new regime, members of a class of claimant will be bound by the outcome on either an opt-in or opt-out basis, depending on the nature of the claim. 

The CRA comes into force against a backdrop of wider reforms across Europe following the adoption of the EU Damages Directive 2014, and also empowers the CAT to hear not only follow-on damages claims (i.e., damages claims limited to the subject matter and scope of antitrust infringement findings of the Competition & Markets Authority, the European Commission and other antitrust authorities), but also stand-alone claims (i.e., those brought before an infringement is proven), which have been, until now, the preserve of the High Court. While the UK has been the EU jurisdiction of choice for cartel claimants to date, these changes will copper fasten London’s preeminence.

Given extensive predictions in the legal and financial Press of group claims arising out of recent misconduct in the financial services industry, particularly alleging breaches of competition law, it can be expected that the UK’s nascent "plaintiff Bar" will be heralding these changes as rendering the English courts dramatically more fertile territory for the claims they are seeking to encourage clients to bring against leading investment banks. Indeed, a number of claimant law firms have publicly claimed to be preparing to file collective proceedings in London in the coming weeks, in particular pointing to regulatory fines imposed against banks in relation to foreign exchange market misconduct as a likely target for early claims. Some such firms claim to be drawing heavily from their experience in US forex class action litigation, although it remains to be seen to what extent the CAT will follow the approach of US courts to class action litigation.

Schedule 8 of the Consumer Rights Act 2015

The CAT’s jurisdiction is limited to hearing claims for loss or damage in respect of an infringement or alleged infringement under Articles 101(1) or 102 of the Treaty on the Functioning of the EU or Chapter I or II prohibitions under the Competition Act 1998, that is to say essentially claims arising from (alleged) cartel conduct or an abuse of dominant position. This is not disturbed by the CRA. 

The most notable change brought in by the CRA is the introduction of a collective proceedings regime. Previously, the availability of collective actions in the UK was limited to representative actions under CPR 19.6(1), Group Litigation Orders and powers under the Competition Act 1998 which provide for designated bodies to bring opt-in actions in the CAT on behalf of consumers. None of these offer anything resembling a US-style class action.

Under the CRA, collective proceedings are now available in respect of both stand-alone and follow-on actions before the CAT. The new regime includes both opt-in and opt-out mechanisms, meaning that it will be possible for claims to be brought without needing to identify every individual claimant. The opt-out element is limited to claimants domiciled in the UK at a specified time; non-UK domiciled persons will have to opt in. The time and manner for opting in and opting out in any case will be set out in a direction by the CAT. 

Collective proceedings must be authorised by the CAT by means of a collective proceedings order. The order will contain a description of the class of potential claimants and state whether the proceedings will be opt-in or opt-out. 

The CAT will only make a collective proceedings order if it considers that: 

a.  The person bringing the proceeding is a person whom the CAT could authorise to act as a representative in the proceeding, i.e., that it would be just and reasonable for them to act as a representative. They do not need to be a class member, but the CAT will consider conflicts of interest and whether they would act fairly and in the interest of class members; and 

b.  The claims raise the same, similar or related issues of fact or law, and are suitable to be brought in collective proceedings (a test that resembles that used in some US States for class certification and similar in part to the test in the UK for Group Litigation Orders). 

The CAT’s new Rules provide some guidance by listing factors that the CAT may consider when assessing the appropriateness of potential representatives and whether proceedings are suitable for collective proceedings, however the lists are not exhaustive. In addition, the CAT’s new Guide To Proceedings, which was published on 1 October, provides some further insight into how the CAT will approach these difficult decisions. The Rules and Guide give the CAT significant discretion and the CAT’s approach to such orders is only likely to become clear when the first collective proceedings are brought.

A CAT judgment in collective proceedings will be binding on all members of the class. The CAT can award damages in collective proceedings without assessing the amount of damages recoverable by each represented person, i.e., it can group the claims of all class members together. In opt-out cases, the CAT will make an order providing for the damages to be paid on behalf of the represented persons to the representative or another person, with any damages ultimately unclaimed within a specified period paid to charity. While the CAT can order such unclaimed damages to be paid to the representative, this is limited to covering the costs of the action. It should also be noted that damages in collective actions are to be compensatory – exemplary damages cannot be awarded in collective actions.

Very importantly, damages-based fee agreements, under which the claimants’ lawyers are paid a percentage of the sums recovered, cannot be used by claimants’ counsel in opt-out collective proceedings. However, conditional fee arrangements, under which the claimants’ lawyers take a reduced or zero fee if the action is unsuccessful but a standard rate plus a success fee if they win, do not appear to be prohibited.

Changes beyond collective actions

In addition to the collective proceedings regime, the CRA amends the Competition Act 1998 and the Enterprise Act 2002, introducing a number of measures designed to widen the remit of the CAT and to enable it to more efficiently hear claims by giving it certain powers currently only available in the High Court. Procedural changes include authorising the CAT to grant injunctions and expanding the existing limitation period for bringing cases before the CAT from 2 to 6 years, bringing it into line with the High Court. 

Moreover, as stated above, prior to the CRA, the CAT could only hear follow-on actions, but the new provisions have given the CAT the power to hear both follow-on actions and stand-alone claims.

The new provisions in the CRA apply to claims brought from 1 October 2015 onwards, although the cause of action may have arisen before that date. As such, claims relating to cartels currently under investigation by the authorities, or in respect of which the regulators’ investigations have been concluded, may be the subject of future collective proceedings.


The new collective proceedings regime (and the opt-out proceedings in particular) under the CRA will provide a tempting option for those who believe they have suffered damage as a result of breaches of competition law. However, claimants might be advised towards circumspection initially given the uncertainty as to the CAT’s approach on key questions that will be encountered early in the proceedings, and the cost and delay as those issues are considered for the first time. 

At the very earliest stages the CAT will be called on to consider who might be an appropriate representative, and perhaps even more problematic in complex financial market claims, which claimants might have sufficiently similar or related issues of fact or law to constitute a valid class. It seems certain that the questions of class certification will be difficult and hotly contested. In light of those difficulties, an opt-in proceeding under existing group litigation procedures may be more attractive to claimants in the immediate term. 


Gibson, Dunn & Crutcher lawyers are available to assist in addressing any questions you may have regarding these developments.  Please contact the Gibson Dunn lawyer with whom you usually work, or the authors in the firm’s London office:

Philip Rocher (+44 (0)20 7071 4202, [email protected])
Patrick Doris (+44 (0)20 7071 4276, [email protected])
Sunita Patel (+44 (0)20 7071 4289, [email protected])
Steve Melrose (+44 (0)20 7071 4219, [email protected])

Please also feel free to contact any of the following members of the UK team:

Ali Nikpay (+44 (0)20 7071 4273, [email protected])
Charles Falconer (+44 (0)20 7071 4270, [email protected])
Deirdre Taylor (+44 (0)20 7071 4274, [email protected]) 

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