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It drew attention to the fact that the bottom rung of BTs proposed 080 pricing ladder involved a payment by BT to the CP and might therefore be said to represent an Operator service, and that at the next rung up no payment was due either way, which made it difficult to say whether it represented an Operator service or ... |
It might, thought Lloyd LJ, be a matter of chance which clause applied. Ratio |
He regarded this as a reason for treating BTs right to vary its charges under Clause 12.2 as being of very limited importance. Ratio |
Mr Daniel Beard QC, who appeared for BT, declined to go into this question at all, and there was little argument upon it even after the Court called for further submissions on the point. ARG |
In my opinion we need not enter into it either, because it is irrelevant. Ratio |
Clause 12 is concerned with variations proposed by BT to charges for a BT service. Ratio |
The fact a variation proposed by BT comprises a tariff in which some payments for the BT service are negative or nil while others are positive does not alter the character of the tariff as a scheme of charges for the BT service, or take it outside Clause 12. Ratio |
The only variations before us are those proposed by BT under Clause 12. Ratio |
We are not concerned with the effect of Clause 13. Ratio |
There is no obvious reason why Ofcoms treatment of the two cases should necessarily be the same notwithstanding differences between the relevant contractual provisions. Ratio |
I am therefore disinclined to attach much practical importance in the present case to the differences between them. Ratio |
Difficult questions may arise in a case where the Article 8 objectives neither preclude nor require a variation and the relevant party has no contractual right to require one. Ratio |
The resolution of those questions must await a case in which they arise. Ratio |
The welfare test Ratio |
Leaving aside Principle 3, which it is now common ground was satisfied, the sole basis on which Ofcom rejected the new charges was that the welfare test having been inconclusive, it had not been demonstrated that BTs new schedule of charges would produce consumer benefits. Ratio |
In my opinion, this was wrong in principle, for substantially the reasons given by the CAT. Ratio |
BT were contractually entitled to vary their charges unless the proposed variations were inconsistent with the Article 8 objectives, including the objective of ensuring consumer benefit in accordance with Article 8.2(a). Ratio |
Ofcom have not found that they were inconsistent with those objectives. Ratio |
They have found that they would produce direct and indirect consumer benefits of unquantifiable value, and that these benefits might or might not be exceeded by disbenefits arising from the attempts of mobile network operators to increase revenue in other directions. Ratio |
The latter factor was found by the CAT to be essentially unknown. Ratio |
In my opinion, it is not consistent with either the contract or the scheme of the Directives for Ofcom to reject charges simply because they might have adverse consequences for consumers, in the absence of any reason to think that they would. Ratio |
It is not consistent with the contract because it prevents BT from exercising its discretion to alter its charges in circumstances where there is no reason to suppose, and Ofcom has not found, that the limits of that discretion have been exceeded. Ratio |
It is inconsistent with the scheme of the Directives because it involves applying an extreme form of the precautionary principle to a dynamic and competitive market, in a manner which is at odds with the Directives market-oriented and essentially permissive approach. Ratio |
Logically, given the inherent difficulty of forecasting the extent of any direct or indirect effects, and the practical impossibility of forecasting the mobile tariff package effect, it would rule out any increases in termination charges other than those justified by reference to underlying costs. Ratio |
On this point, therefore, I think that the CAT were right and that the Court of Appeal were wrong to overturn them. Ratio |
In its submissions on the appeal, Ofcom submitted that the degree of risk which is acceptable must be related to the gravity of the adverse effect if the risk materialises. ARG |
It expressed concern that it should not, for example, be inhibited from blocking a price variation which on a balance of probabilities was unlikely to be adverse, but which if things went wrong would be catastrophic. ARG |
I agree. ARG |
This would be an example of a case where the existence of the risk was itself adverse to the interests protected by Article 8. ARG |
But on the facts found by Ofcom and the CAT, we are a long way from that kind of situation in the present case. ARG |
It is right to add that if and when sufficiently adverse effects were to materialise at some point in the future, Ofcom has power to intervene to address them at that stage. ARG |
Anti-competitive effect of price control Ratio |
The Court of Appeals second reason for thinking that it was for BT to demonstrate positively that there would be consumer benefits from the proposed changes to their charging structure was that they disagreed with the CATs emphasis on the anti-competitive effect of preventing the introduction of innovative charging str... |
The Court of Appeal did not suggest that it was economically mistaken. Ratio |
But they considered that too much weight had been attached to it by the CAT. Ratio |
In their view, this was a matter of regulatory policy. Ratio |
Since Ofcom was the regulator and it was exercising a regulatory function in resolving the present dispute, the CAT should not have interfered with their conclusion unless Ofcom erred in principle. Ratio |
The Court of Appeal thought that since the CAT substantially agreed with Ofcoms conclusion on the welfare test, there was no error of principle. Ratio |
I think that in this respect also, the Court of Appeal was wrong. Ratio |
In the first place, as I have explained, in resolving this particular dispute, Ofcom was not exercising a regulatory function, but resolving a dispute under the unchallenged terms of an existing agreement. Ratio |
But the main problem about the Court of Appeals view is a more fundamental one. Ratio |
According to the CATs analysis, the effect of not allowing BT to introduce innovative charging structures was itself anticompetitive because innovative pricing structures are an effective mode of competing. Ratio |
This was clearly a relevant consideration, even if it was not a conclusive one: see Article 8.2(b) of the Framework Directive. Ratio |
It was not a consideration taken into account by Ofcom. Ratio |
Since the right to introduce the proposed pricing package brought benefits for competition, the mobile network operators should have to justify their demand that the package should be rejected by pointing to some countervailing detriments to consumers disclosed by the welfare test if it were to be accepted. Ratio |
An inconclusive welfare test could not be enough for this purpose. Ratio |
The CAT was hearing an appeal by way of rehearing on the merits. Ratio |
Their conclusion about the anti-competitive effects of restricting price changes and the weight to be attached to it was a factual judgment which it was perfectly entitled to make. Ratio |
It was, moreover, an economic judgment by an expert tribunal which had received a substantial amount of additional evidence, including economic evidence. Ratio |
Since appeal lay to the Court of Appeal only on points of law, the CATs findings on the distortion of competition liable to result from the rejection of the new charging structure were not open to rejection on appeal. Ratio |
Inappropriateness of restricting prices in the absence of significant market power Ratio |
These considerations are enough to resolve the present dispute in favour of BT. Ratio |
It is therefore unnecessary to consider the CATs third reason for requiring the mobile network operators to show a distinct disbenefit to consumers in order to justify rejecting a proposed change to interconnection charges. Ratio |
This was that the rejection of BTs proposed charges amounted to imposing price control on an entity such as BT which had not been designated as having significant market power in a relevant market. Ratio |
This, it was argued, was wrong in principle because there was no power under the Directives and the Act to regulate the prices of a firm without such power. Ratio |
BT put this point at the forefront of their submissions. Ratio |
For reasons which were never entirely clear but may have to do with their commercial and regulatory strategies, they were anxious to avoid relying on BTs rights under the Interconnection Agreements or adopting those parts of the CATs reasoning which were based on them, and instead sought to obtain a ruling that the Com... |
I will only say that as at present advised I am not convinced by this. Ratio |
It seems to me to be irrelevant to the question on which this appeal turns, namely whether BT must positively demonstrate consumer benefit if they are to justify their proposed charges. Ratio |
Moreover, the fact that BT does not have significant market power in a relevant market does not mean that the promotion of competition, which is included among the Article 8 objectives, is irrelevant to a dispute about charges. Ratio |
It only means that Ofcom may not exercise its regulatory power to control prices. Ratio |
Ofcom has not purported to do this. Ratio |
There is an important difference between (i) exercising a regulatory power to impose price control in order to correct market failure or control the abuse of a dominant economic position, and (ii) deciding whether a particular proposed tariff change advances consumer welfare for the purpose of determining whether there... |
A hypothetical alternative analysis Ratio |
It will be apparent that I do not accept the basic conceptual framework within which the Court of Appeal reviewed these questions. Ratio |
It is, however right, in view of the way that the argument went and in the light of suggestions that there should be a reference to the Court of Justice of the European Union, to point out that the result would have been the same even if Lloyd LJ had been right to regard Ofcoms dispute resolution functions as purely re... |
The whole scheme of the Directives is to leave the arrangements for interconnection to the parties unless there are grounds for regulatory intervention. Ratio |
The permissible grounds of regulatory intervention in the case of a CP without significant market power are that the interconnection terms have been framed or are being operated in a manner which is inconsistent with end-to-end connectivity or conflicts with the Article 8 objectives. Ratio |
If the result of the welfare test and the competition test is that there is no positive reason to believe that the effects will be adverse, there is no justification for regulatory intervention. Ratio |
Reference to the Court of Justice of the European Union Ratio |
If this appeal turned on the point about the absence of significant market power which BT put at the forefront of their submissions (see paragraphs 47-8 above), it would in my view have been appropriate to refer that point to the CJEU before determining it. Ratio |
As it is, I would decide the appeal on less controversial grounds, and I do not consider that a reference is appropriate. Ratio |
The recognition that the interconnection terms are the starting point does not itself warrant a reference, since the centrality of the interconnection terms in the scheme of the Directives is obvious and no convincing reason has been put forward by any of the parties or interveners for ignoring them. Ratio |
In any event, for the reasons that I have given, the outcome would be the same even on a purely regulatory analysis. Ratio |
Leaving aside Mr Beards argument about the absence of significant market power, there is no dispute about the Article 8 criteria themselves. Ratio |
Ultimately, the problem which the Respondents have faced on this appeal is that the CATs economic analysis of the facts was that there was no reason to anticipate a net adverse effect engaging that Article. Ratio |
Conclusion RPC |
In my opinion there was no justification for the Court of Appeal to set aside the careful analysis of the CAT on a matter lying very much within its expertise. RPC |
I would accordingly allow this appeal. RPC |
Counsel will be invited to make written submissions on the form of order unless this can be agreed. RPC |
In my opinion there was no justification for the Court of Appeal to set aside the careful analysis of the CAT on a matter lying very much within its expertise. RPC |
I would accordingly allow this appeal. RPC |
Counsel will be invited to make written submissions on the form of order unless this can be agreed. RPC |
These appeals concern requests made for the surrender under Part 1 of the Extradition Act 2003 of three persons wanted to serve sentences imposed upon their conviction in other member states of the European Union. FAC |
The requests relating to the appellants Mindaugas Bucnys (Bucnys) and Marius Sakalis (Sakalis) come from the Ministry of Justice of the Republic of Lithuania. FAC |
The third request, relating to the respondent Dimitri Lavrov (Lavrov), comes from the Ministry of Justice of the Republic of Estonia. FAC |
The Ministries made the requests in the form of European arrest warrants intended to meet the requirements of Council Framework Decision 2002/584/JHA on the European arrest warrant and surrender procedures between member states of the European Union (the Framework Decision). FAC |
Within the United Kingdom, Part 1 of the Extradition Act 2003 was enacted to give effect to the same requirements. FAC |
Under section 2(7) of the 2003 Act the requests were, after receipt in this country, certified by the Serious Organised Crime Agency (SOCA), the designated authority under section 2(9), as Part 1 warrants issued by a judicial authority of a category 1 territory having the function of issuing arrest warrants. FAC |
The questions of principle raised by the present appeals are whether the requests are open to challenge on the basis that (i) they were not the product of a judicial decision by a judicial authority within the terms of the Framework Decision and/or of Part 1 of the United Kingdom Extradition Act 2003, and (ii) the Mini... |
If a challenge is open on either or both of these bases, the third question is (iii) whether the challenge is on the evidence well-founded in the case of either or both of the Ministries. Ratio |
The Administrative Court (Aikens LJ and Globe J) on 12 December 2012 answered the first question in the affirmative and the second in the negative: [2013] 1 All ER 1220. RLC |
As to the third, it concluded that a ministry of justice would under European law be regarded as a judicial authority for the purposes of issuing a conviction warrant if it was sufficiently independent of the executive for the purposes of making that judicial decision (para 98); it held further that the antecedent proc... |
Bucnys and Sakalis now appeal, while the Estonian Ministry appeals in the case of Lavrov. RLC |
The bases of the requests FAC |
The request in respect of Bucnys results from his conviction for six housebreaking and one fraud offences, for which a total sentence of 5 years 4 months was passed on 29 February 2007. FAC |
He was released conditionally by the Alytus Region District Courts order on 12 September 2008, but on 20 February 2010 the Vilnius City 1st District Court quashed his conditional release for failure to abide by the condition, requiring him to serve a further period of 1 year 7 months 28 days. FAC |
The request for his surrender was expressed to be based on this court order dated 20 February 2010. FAC |
Since preparing this judgment, the court has been informed by those instructed by Bucnys that he has died, presumably since the hearing. FAC |
The issue raised remains of general importance, and this judgment records the Courts conclusions on it. FAC |
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