The class representative acted on behalf of customers who held Transport for London Travelcards, which allowed unlimited travel on the public transport network in London, but had not purchased Boundary Fares, which covered the balance of a customer’s journey from the outer edge of the zone to which the Travelcard applied to the customer’s destination. If a Travelcard holder purchased a full journey fare instead of a Boundary Fare covering the balance of the journey, he or she paid twice for part of the journey. The class representative alleged that by failing to make Boundary Fares sufficiently available for sale and/or failing to use best endeavours to ensure that there was a general awareness among customers of Boundary Fares, the defendant train operating companies had abused their dominance in the market, contrary to the prohibition in section 18 of the Competition Act 1998. In three parallel collective claims for aggregate damages, the class representative contended that if the defendants’ conduct could be seen as a misleading omission and therefore an unfair commercial practice within the meaning of the Consumer Protection from Unfair Trading Regulations 2008, that could be taken into account when assessing whether their conduct was abusive.
On the stage 1 trial to determine whether the conduct alleged constituted an abuse of dominant position—
Held, (1) The Consumer Protection from Unfair Trading Regulations 2008 were only relevant if it could be shown that the defendants had not complied with their obligations under them. Since non-compliance with the rule against misleading omissions, which had not been pleaded, was a serious allegation and a criminal offence, it was not open to the class representative to ask the tribunal to find that the rule had been breached. Accordingly, the Regulations were not relevant (paras 73, 77).
(2) If a dominant company made a product sufficiently available to customers and did not seek to conceal its existence, its special responsibility to avoid the imposition of unfair trading terms did not require it to promote or advertise a product that would benefit some of its customers to increase their awareness of that product. A duty on a dominant company under competition law actively to assist its customers to pay the lowest price or to buy the optimal product for their needs would have very broad implications and there was nothing in the jurisprudence on abuse of dominance to support it. There was no suggestion that any of the defendants had adopted a policy to keep Boundary Fares obscure or to leave customers unaware of their existence. As to the alleged lack of availability of Boundary Fares, (i) they were available for purchase from all of the defendants’ ticket offices, (ii) although one of the defendants had decided not to make them available from ticket vending machines for reasons relating to fraud, the others had taken reasonable steps to enhance the functionality of their vending machines to sell them, (iii) there was no evidence that any of the defendants had sought to discourage third-party ticket retailers from selling them and (iv) since they were available through the defendants’ more significant channels, the fact that more effort and expense had not been devoted to enable their introduction online was nothing more than normal commercial conduct. Although the defendants’ selling systems could have been improved, the question was whether they were abusive, not whether they were open to any criticism. None of the three defendants’ selling systems, viewed as a whole, constituted or gave rise to an abuse. Accordingly, on the assumption that the defendants held a dominant position, none of the conduct alleged constituted an abuse of that position (paras 93, 102, 105, 123, 125, 133, 138, 152, 176).
Per curiam. Although the concept of abuse is broad, it is not unlimited. Where allegations concern systemic conduct, the fact that the dominant company could have carried out a particular aspect of its business better, or in a different way that would have benefited consumers, does not mean that the conduct crossed the line to constitute abuse. Questions as to how a fair market ought to be organised might be relevant to a market investigation, but that is distinct from the question whether specific conduct of certain participants in the market constitutes an abuse (para 79).
Philip Moser KC, Stefan Kuppen and Alexandra Littlewood (instructed by Hausfeld & Co LLP and Charles Lyndon Ltd) for the class representative.
Tim Ward KC, James Bourke and Hugh Whelan (instructed by Slaughter and May) for the defendant in the first claim.
Paul Harris KC, Anneliese Blackwood, Michael Armitage and Clíodhna Kelleher (instructed by Freshfields Bruckhaus Deringer LLP) for the defendants in the second and third claims.
Anneli Howard KC, Brendan McGurk and Khatija Hafesji (instructed by Linklaters LLP) for the Secretary of State for Transport, intervening by written submissions only.