Synthon BV, R (on the application of) v The Licensing Authority & Anor

A national court should ordinarily refer an unresolved question of Community law to the ECJ unless it can resolve the issue with complete confidence. Restraint is appropriate where the issue concerns only applying settled principles to facts, but a question of general importance capable of promoting uniformity in European law is a proper subject for reference. A conceded breach on one ground does not ordinarily prevent determination of a separate arguable breach, particularly where declaratory relief is sought. Liability should generally be considered before causation, and the seriousness of an alleged breach must be assessed in the light of all relevant circumstances.

Synthon challenged the Licensing Authority’s refusal to accept its application for a marketing authorisation for a paroxetine product. It alleged breaches of the mutual recognition procedure and an unlawful policy that different salts of the same active principle could never satisfy essential similarity.

The Authority accepted that the salts policy was unlawful but argued that the remaining mutual-recognition issue need not be decided. The judicial review proceedings had been stayed pending related patent proceedings and European proceedings. Synthon sought to lift the stay and obtain a reference to the ECJ, alternatively directions for the substantive judicial review. The central issue was whether a reference was necessary at that stage.

1. The application was granted to the extent that a reference to the ECJ was necessary in the terms of the draft order. The Authority and SmithKline Beecham plc were invited to participate in settling the reference.

2. Ordinarily, an unresolved issue of Community law should be referred unless the national court can resolve it with complete confidence: R v International Stock Exchange of the UK and the Republic of Ireland Ltd ex parte Else [1993] QB 534. The need for restraint, identified in Trinity Mirror plc v Commissioners of Customs and Excise [2001] EWCA Civ 65, does not prevent a reference where the issue is one of general importance and its resolution is likely to promote uniform application of European law.

3. The mutual-recognition issue raised a good arguable case and concerned the proper scope of the Authority’s powers under that procedure. The court considered that, if established, Synthon would be likely to obtain declaratory relief. It would therefore be exceptional to prevent the issue proceeding merely because another ground of unlawfulness had been conceded.

4. The Authority’s damages arguments were premature. Causation should not ordinarily be determined before liability, particularly where two distinct heads of alleged unlawful conduct could give rise to loss. The assessment of whether a breach was sufficiently serious required consideration of all the circumstances, consistently with Haim [2000] ECR I-5123.

This was a first-instance judicial review application. The proceedings had been stayed by Master Venne’s order of 19 February 2004. Silber J had previously made an order dated 6 June 2003 directing preparation of a draft reference to the ECJ. The present court lifted the stay and directed that the reference proceed.