Competition is one of the foundations for prosperity and growth, driving better outcomes for SMEs and consumers alike.
But in Britain today, competition is under attack.
The Competitive Britain campaign was set up to protect competition enforcement in the UK and remove barriers to growth, competition and redress - building a fairer, more prosperous country for all.
By preventing companies from engaging in anticompetitive practices, we can:
Britain’s competition enforcement regime is under attack by lobbyists trying to weaken its most effective element: the collective actions regime.
Since 2015, ‘opt-out collective actions’ – the closest thing the UK has to class actions – have been permitted at the Competition Appeal Tribunal (CAT), the specialist tribunal that deals with infringements of competition law.
When companies harm multiple businesses and consumers, collective actions enable the claimants to have their day in court and be heard together. In opt-out claims, everyone who is affected by a particular issue is included. This is crucial because very often a small amount of harm is caused to a very large number of consumers or businesses.
With cases against Apple, Royal Mail and Motorola among others brought on behalf of SMEs and consumers, the CAT’s collective action regime is the UK’s strongest legal mechanism to stop illegal anti-competitive behaviour, and drive growth and prosperity.
Because the opt-out collective actions regime is starting to deliver, the big business lobby is trying to weaken it by making opt-out collective actions unviable. This would shift the dial back in favour of the most powerful global corporations, weaken British competitiveness, disadvantage consumers and stifle growth and innovation.
Lobbyists are also attacking third-party or litigation funding, which allows private funders to pay for cases, not the taxpayer. The vast majority of collective proceedings claims are funded by third-party litigation funders - the regime would not function without them. As postmaster Sir Alan Bates has pointed out, "Litigation funding enables consumers and small business owners like us to fight our corner".
Collective action has the power to curb monopolistic behaviour, and there is a growing body of evidence on its direct value to the UK. Independent economic and legal research estimates the opt-out regime brings the UK net economic benefits of up to £10.5 billion every year. Geradin Partners' new report brings this together with the wider research and directly debunks the common arguments against the regime, exposing both bad faith and bad economics.
Another study published by respected law firm Stephenson Harwood found collective actions have a median impact of £18.1bn on the economy. Even the government's own research estimates that for every £1 of damages awarded in a standalone competition claim (that is, a claim which doesn’t follow a regulatory decision), there is a £5 benefit to the economy as a result of deterring instances of similar anti-competitive behaviour.
Given the intensity of the big business lobby’s efforts to undermine the opt-out regime, there are concerns from lawyers, NGOs and consumer rights groups that the Government may introduce changes to the regime that will make it harder to hold big business to account.
Weakening the CAT and the collective actions regime would have serious consequences for Britain’s economy. Given the UK still has less public competition enforcement (i.e. enforcement by regulators) than other high-productivity markets like France and Germany, without the CAT, the UK the government would need to seriously consider how it wishes to enforce competition law.
Contact us and join the campaign. Together we can build a fair, thriving and competitive Britain for all.
