BCL Old Co Ltd & v BASF SE & Ors

The case-management power in the Competition Appeal Tribunal Rules to extend “any time limits” does not permit the Tribunal to extend the two-year period for commencing a follow-on damages claim. That period operates as a definitive limitation period. A power to permit late commencement would require express and specific provision.

This regime is compatible with European Union principles of effectiveness, legal certainty and legitimate expectation. A judicial interpretation of legislation which has remained unchanged does not retrospectively shorten a limitation period. Nor does an unsuccessful understanding of that legislation create a legitimate expectation that proceedings may be commenced later.

The appellants sought follow-on damages for losses caused by a vitamins cartel. The claim depended upon a European Commission decision finding an infringement of article 81 of the EC Treaty. An earlier Court of Appeal decision, [2009] EWCA Civ 434, established that an appeal confined to the amount of a fine did not suspend the time for commencing such proceedings. The appellants' claim was consequently out of time.

The Competition Appeal Tribunal refused an alternative application to extend time: [2009] CAT 29. On appeal, the respondents contended that the Tribunal had no power to grant any extension. The principal questions were whether Rule 19(2)(i) conferred such a power and whether European Union principles required a different result.

1. Appeal dismissed. Rule 19(2)(i) of the Competition Appeal Tribunal Rules did not confer power to extend the period prescribed by Rule 31 for commencing a follow-on damages claim. Lord Justice Sullivan and Lord Justice Maurice Kay agreed with the judgment of Lord Justice Lloyd.

2. Rule 31 created a definitive limitation period corresponding to the limitation imposed upon a stand-alone claim by section 2 of the Limitation Act 1980. Although Schedule 4 paragraph 11 of the Enterprise Act 2002 authorised rules permitting extensions, the Rules did not exercise that power for damages claims. A power to permit late commencement would naturally have appeared expressly in Rule 31, as the limited extension power for appeals appeared in Rule 8(2).

3. Rule 19 was a case-management provision. In its original setting it did not extend the time for commencing an appeal, and its incorporation into the damages regime did not enlarge its character. Its references to abridging time and to fixing time limits for aspects of proceedings confirmed that it concerned proceedings already commenced. The contrary conclusion in Emerson Electric Co v Morgan Crucible Co plc [2007] CAT 28 was rejected. That conclusion had not been necessary to the Tribunal's decision.

4. European Union law did not require an extension power. The two-year period was clear, fixed in advance and did not make the exercise of the right to damages virtually impossible or excessively difficult. The earlier judicial interpretation of unchanged legislation was not equivalent to retrospective legislation reducing an existing limitation period. The appellants therefore had no legitimate expectation that time would run until two years after the determination of an appeal confined to penalty.

5. The claim had been rightly dismissed as out of time. It was unnecessary to review the Tribunal's purported exercise of discretion because no such discretion existed.

1. Court of Appeal (Civil Division): In [2010] EWCA Civ 1258, the court dismissed the appeal and held that the Competition Appeal Tribunal had no power to extend the Rule 31 period.
2. Competition Appeal Tribunal: In [2009] CAT 29, the Tribunal refused the appellants' application for an extension of time, having assumed that an extension power existed.
3. Earlier Court of Appeal proceedings: In [2009] EWCA Civ 434, the court reversed the Tribunal and held that the damages proceedings had been commenced out of time because an appeal confined to penalty did not suspend time.