Competition Magazine Issue 12 by thoughtleaders4

ISSUE 12 - FEB 2026

MAGAZINE Policy, Power, and Collective Redress: The Road Ahead – Next Gen Edition

Thought Leadership for and by the Competition Community

ThoughtLeaders4 Competition Magazine • ISSUE 12

INTRODUCTION “The best way to predict the future is to create it”

- Abraham Lincoln As we begin another dynamic and fast-moving year in competition law and litigation, Issue 12 looks ahead to the developments shaping our field. From landmark judgments and evolving regulatory priorities to emerging trends set to influence the year ahead, this has been a period defined by policy shifts, novel theories of harm, and an increasingly global approach to litigation strategy - all of which our contributors explore with clarity and insight. This issue would not be possible without the expertise and generosity of our corporate partners and authors. We thank them for sharing their time, analysis, and perspectives. We hope you enjoy the first edition of 2026 and find it both useful and insightful as you prepare for the challenges and opportunities of the year to come.

ThoughtLeaders4 Competition Team Peter Miles

Helen Berwick

Head of Event Production & Community Director 020 3481 8843 email Peter

Alexander Edgal

Chris Leese

Dr Rachael Kent vs. Apple Inc. and Apple Distribution International Ltd.............................. 13 60 Seconds With... Lachlan Sykes................................. 15 AI in Claims Management Between Hype and Hard Reality.................................................... 17 Disclosure at Scale - Proportionality and the Changing Shape of Disclosure......................... 20

email Yelda

Beccaria and Becker in Conversation Brazil’s Antitrust Reform Excluding Individual Liability .......................................................... 31

Amelia Gittins Senior Strategic Partnership Executive 020 3059 9797 email Amelia

CONTRIBUTORS Ian Thompson - Economic Insight Alasdair Crookes - Economic Insight Chris Ford - Blackhawk Network Charlie Xie - AlixPartners Louis Dudney - AlixPartners Derek Holt - AlixPartners Michael Davis - AlixPartners Lachlan Sykes - Angieon Group International Jade Tess Weiner - Angieon Group International Sam Cave - Angieon Group International Dan Heinrichs - Sky Discovery Barney Stannard - Travers Smith Joseph Moore - Travers Smith Charles Keen - Travers Smith Maria Rosaria Raspanti - Pavia e Ansaldo Studio Legale Alessandro P. Giacaglia - Pinheiro Neto Advogados

Do UK Consumers Understand Collective Redress And are They Willing to Engage with Proceedings Through to Receiving Payment?................................... 9

Recent Ruling of the Italian Council of State on the Application of the Domestic FDI Regime................ 27

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Founder/ Managing Director 0203 398 8510 email Paul

Yelda Ismail

Founder/Chief Operating Officer 020 7101 4191

Paul Barford

Is the Juice Worth the Squeeze? Lessons from Take-Up Rates in US Opt-Out Claims.....

Evans V Barclays - Supreme Court Puts Merits Back on the Table........................................ 23

Danushka De Alwis

Founder/Chief Commercial Officer 020 7101 4151 email Chris

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Commercial Director Competition 0203 433 2281 email Helen

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CONTENTS

Philipp Melcher - Morais Leitao Beatriz Lopes da Silva - Morais Leitao Joana Fraga Nunes - Morais Leitao Melanie Bruneau - K&L Gates Brussels Nikolaos Peristerakis - K&L Gates Brussels Antoine de Rohan Chabot - K&L Gates Brussels Ashley Brickles - FTI Consulting Julian Stait - Milbank Mark Padley - Milbank Georgia Kinsella - Milbank Rachel Malloch - Linklaters Anna Stellardi - Competition and Markets Authority Hamid Aghadadashli - Compass Lexecon Gianluca Strada - Compass Lexecon Roberto Venturini - Compass Lexecon Nanret Senok - Linklaters

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Portuguese Merger Control Foreign Joint Ventures and Local Nexus...................... 34 Overview of Recent Updates in EU Foreign Investment, Foreign Subsidies and Merger Control......................................................... 37 AI Prompts New Scrutiny and Opportunity in Competition Investigations........................................ 41 The Class Members and the Merits Supreme Court Clarifies the Choice between Opt-Out and Opt-In Proceedings................................... 44

| ESSAY COMPETITION | 1st CMA Proposals - A Shift from Private Claims to Public Enforcement?........................ 51 2nd CMA Proposals - A Shift from Private Claims to Public Enforcement?........................ 54 3rd Comments on the CMA’s Proposal on Review of the Opt-Out Collective Actions Regime An Economist’s View ..................................................... 57 CMA Proposals - A Shift from Private Claims to Public Enforcement?........................ 60

Upcoming Events The Competition Law & Litigation Next Gen Summit UK 3 - 4 March 2026 | Glaziers Hall, London, UK The EU Digital Markets Competition Litigation & Compliance Forum - 2nd Annual 10 March 2026 | DoubleTree, Brussels, Belgium UK Competition Law Circle 12 - 13 March 2026 | Down Hall Hotel, Hertfordshire, UK European Competition Litigation Circle 7 - 8 May 2026 | Le Mirador, Vevey, Switzerland The Global Merger Control Forum 2026 - 2nd Annual 12 May 2026 | DoubleTree, Brussels, Belgium The CMA Consumer Protection and Enforcement Regime Summit - 2nd Annual 21 May 2026 | One Whitehall Place, London, UK Nordics Competition Law Circle May 2026 | Marienlyst Hotel, Copenhagen, Denmark The EU Competition Law & AI Regulation Forum 3 June 2026 | DoubleTree, Brussels, Belgium The Competition Collective Actions Forum - 4th Annual 11 June 2026 | One Great George Street, London, UK The UK Competition Law Summit - 3rd Annual 18 June 2026 | London, UK

For Partnership enquiries, please contact Helen on +44 (0) 20 3433 2281 or email helen@thoughtleaders4.com

WE MAKE ECONOMICS RELEVANT Rigorous Analysis & Exceptional Consulting Skills Economic Insight is an economics consultancy that provides an unrivalled level of service. Our unique proposition is that we combine the rigour of technical economics with exceptional consulting skills to help you make great decisions. We are a team of expert, highly experienced and skilled economists with a focus on translating our analysis into clear, accessible and valuable advice. In our opinion, that’s what makes us different and what makes economics relevant. Visit www.economic-insight.com or search Economic Insight on LinkedIn

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ThoughtLeaders4 Competition Magazine • ISSUE 12

IS THE JUICE WORTH THE SQUEEZE?

LESSONS FROM TAKE-UP RATES IN US OPT-OUT CLAIMS Authored by: Ian Thompson (Associate Director) & Alasdair Crookes (Senior Consultant) - Economic Insight The issue of take-up rates in opt-out claims is firmly in the sights of the Competition Appeal Tribunal (CAT). Following a settlement between class representative Justin Gutmann and Stagecoach South Western Trains, less than 1% of the pot allocated to class members was claimed.1 Subsequently, when approving a settlement in the RoRo collective action, the Tribunal stressed that it did not want a repeat of that situation.2 The Tribunal has also indicated that: (i) it may consider the effectiveness of distribution plans at the certification stage; and (ii) evidence of take-up rates from the US may be helpful, but evidence from actual class members would be preferable.3,4 This article considers what the evidence from the US shows, and what it may mean for the UK opt-out regime.

100 claims;5 and (ii) a series of white papers from the law firm Jones Day on class action settlements, which analyses data obtained through public records related to 60 claims with sufficient take-up information.6 Based on these two studies, we make the following three observations.

Key Findings from US Opt-Out Claims The two most relevant recent studies that we are aware of are: (i) a 2019 Federal Trade Commission (FTC) study of class action settlements, which analyses data subpoenaed from class action administrators in relation to over

Average Take-Up Rates when Class Members are Required to Submit a Claim Form have been around 4% to 9%. The FTC study found that, for the cases in its sample that required class members to submit a claim form, the median claim rate was 9%, and the weighted mean (cases weighted by the

1 See, for example, Gutmann v South Western Trains, CAT ruling 7 July 2025, paragraphs 1 and 3. 2 McLaren v MOL and Others, CAT oral ruling, 15 January 2026. 3 See, for example, Spottiswoode v Nexans and Others, CAT Judgement (Collective Proceedings Order), 3 May 2024. 4 Gutmann v South Western Trains, CAT Judgment (SSWT Collective Settlement), 10 May 2024. 5 ‘Consumers and Class Actions: A Retrospective and Analysis of Settlement Campaigns’, Federal Trade Commission, September 2019. 6 An Empirical Analysis of Federal Consumer Fraud Class Action Settlements (2010–2018)’, Jones Day, April 2020; and ‘Update: An Empirical Analysis of Federal Consumer Fraud Class Action Settlements (2019–2020)’, Jones Day, July 2021.

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ThoughtLeaders4 Competition Magazine • ISSUE 12 number of recipients directly notified) was 4%. The Jones Day study found similar averages. Various potential explanations for these low take-up rates have been put forward, such as the effort of making a claim not being worth the compensation on offer, potential claimants not feeling they had been harmed in the first place, and poor approaches to distribution. The above take-up rates reflect cases where claimants have been required to submit a claim form to receive damages. Take-up has been much higher in cases where there has been an automatic distribution of damages or cheques have been sent directly to class members. The FTC also noted that for its own redress programmes (where it has sought to return money to customers from its day-to-day enforcement efforts, rather than through a class action settlement), it usually has the information to send cheques directly to those affected. In such circumstances, it indicated in a 2018 annual report that 67% of eligible recipients cashed their cheques. In cased where it does not have sufficient details to send cheques directly to those affected, and requires people to apply for a refund, it generally received claims from about 5% to 20% of potential claimants.

Higher Damages are Likely to have Resulted in Higher Take-Up Rates. The Jones Day study suggested that the two highest take-up rates in its sample – 49% and 37% – might be explained, at least in part, by the relatively high damages per class member that they were offering (up to $100 in one case, and up to $1,200 in the other). However, the FTC did not find a strong relationship between damages per class member and take-up rates in its study. The FTC found this result surprising, and noted that many consumers may not have read the notice that they received, and that about a third of notices did not provide any compensation estimate.

The Approach to Distribution Mattered. Both the FTC and Jones Day studies found that the approach to distribution likely affected the observed take-up rates – and was perhaps the main driver. For example: • The FTC found a median take-up rate of 16% when class members were sent a ‘notice packet’ (typically consisting of a detailed notice with a claims form sent in the post), compared to a median take-up rate of 2% when class members were sent an email. • The FTC also found a median takeup rate of 17% when class members were contacted twice or more, compared to a median take-up rate of 8% when class members were only contacted once. • The Jones Day study found that take-up rate for cases predominantly providing ‘direct notice’ (direct mail or email) was double that for case predominantly providing ‘general public notice’ (e.g. in magazines, newspapers, and internet advertisements).

Conclusions Evidence from the US suggests that, unless there is some form of automatic payment, a material proportion of class members may not take up damages awarded in UK opt-out collective actions. Nevertheless, there are limits to how comparable the US experience is to the UK, and the take-up rate in each case is likely to be driven by a number of case-specific factors. Detractors of the opt-out regime will likely suggest that the experience in the US is evidence that the UK regime will not materially compensate those that were harmed by an infringement. Supporters of the regime will likely suggest that the US experience shows that, if done right, a meaningful proportion of class members can be compensated. Supporters may also be considering how technological developments may support future take-up rates (such as enabling them to contact class members directly or implement automatic payments). Furthermore, the Department for Business and Trade – whilst developing its plans to reform the opt-out regime – may be considering what balance between the take-up among class members and cy pres damages would be required for the regime to be successful. The Tribunal, in approving future settlements, may also look carefully at the incentives of different parties to ensure that as much of the damages as possible are returned to those who were harmed.

Comparability Whilst evidence from the US provides specific estimates of take-up rates, some caution should be exercised over how comparable the results are to the UK. For example, the US studies were based on opt-out claims in relation to a range of issues, such as false advertising, improper payment, and consumer privacy – very few were in relation to competition issues. Furthermore, the FTC study drew on class actions settlements primarily from 2013, 2014, and 2015, and the Jones Day study considered settlements between 2010 and 2020. Attitudes, practices, and technology may have moved on somewhat, and there are also inherent differences between the US and UK.

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The EU Digital Markets Competition Litigation & Compliance Forum 10 March 2026 | DoubleTree by Hilton, Brussels

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Complimentary attendance for In-House Counsel, Regulatory Authorities and Government Representatives

For partnership enquiries, please contact Helen on +44 (0) 20 3433 2281 or email helen@thoughtleaders4.com

ThoughtLeaders4 Competition Magazine • ISSUE 12

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DO UK CONSUMERS UNDERSTAND COLLECTIVE REDRESS AND ARE THEY WILLING TO ENGAGE WITH PROCEEDINGS THROUGH TO RECEIVING PAYMENT?

Authored by: Chris Ford (Senior Director) - Blackhawk Network The UK introduced collective proceedings under the Consumer Rights Act in 2015, it was heralded as a breakthrough for consumer justice, which indeed it was. A mechanism (and a promise) to help ordinary people recover losses that, individually, would never justify the cost of legal action.

where of the £25m settlement, less than 1% was delivered in payouts to affected travellers, the BHN Research team were set the challenge to find out whether UK consumers knew what Collective Redress was and, as important, whether they were willing to become claimants.

The following are some key takeaways from our research to 1,000+ consumers across regions and demographics in the UK:

Through the past decade the legal regime has built significant momentum in the UK, but despite billions of pounds in claimed damages being filed, the reality is that the UK is still struggling to deliver paid damages to consumers. In 2025, some notable cases concluded including Gutmann v’s Southwestern Trains, Merricks v’s Mastercard, Kent v’s Apple and McLaren v MOL, providing the regime with several opportunities to make good on the promise of getting redress to UK consumers. After the challenges of the first settlement distribution, linked to Gutmann v’s Southwestern Trains,

ThoughtLeaders4 Competition Magazine • ISSUE 12

The full findings have unequivocally highlighted that 90% of consumers believe businesses should face financial consequences when they do wrong. The challenge, however, continues to be whether they believe enough in the case to provide sensitive personal information to be considered as a claimant and receive their financial redress! Over the years, BHN have spoken at length about providing “Payment Choice” to counter the consumer concerns around being a claimant in a case where the sharing of sensitive personal data happens in advance of payment being made. Today BHN issue a payment token to a validated claimant that allows them to choose how they wish to be paid, at the point the funds are available to be sent, removing all concerns about sharing personal data and therefore increasing the likelihood of claimants willing to be part of the case.

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The survey data validates the concept of “Payment Choice” and shows that alternative payments (prepaid cards, gift cards, multi store gift cards like One4all) gain strong traction when the damages payment is below £500. Furthermore, the concept of choosing how you wish to receive payment, at the point payment is due, gathers strong acceptance across all respondent groups.

the highest claim rates across the industry. Once we have the claimant data (first name, last name, mobile number, email) and are provided with the relevant funds, which we hold in safeguarded accounts, we confidently issue 100% of the value at a fraction of traditional processing costs based on the Payment Choice the claimant makes.

Of course, it can’t be expected that the teams aligned with the core legal process will fully understand payment processing. Likewise, payment processing experts will not understand the full complexities surrounding legal proceedings. But what is clear is to turn the promise of redress into a successful reality will require the entire Collective Proceedings eco-system to collaborate early and often to perfect the outcomes.

We all play a role in delivering the promise of the Collective Proceedings regime, and we look forward to the ongoing collaboration. For more information please visit Appeasement and settlement administration made simple | BHN or get in-touch with chris.ford@bhn.com who would be delighted to walk you through the full BHN Research survey.

At BHN, we have distributed millions in disbursements on a global scale and continue to lead the market in obtaining

Experience you can rely on, results you can trust.

AlixPartners’ Economics Consulting team brings a rigorous, fact-based approach to high-stakes litigation, investigations and regulatory matters. To find out more, visit: www.alixpartners.com

When it really matters.sm

The CMA Consumer Protection and Enforcement Regime Summit - 2nd Annual The Only Summit on the CMA’s New Consumer Enforcement Powers Granted Under the DMCC Act.

21 May 2026 One Whitehall Place, Central London

Complimentary attendance for In-House Counsel, Regulatory Authorities and Government Representatives

For partnership enquiries, please contact Helen on +44 (0) 20 3433 2281 or email helen@thoughtleaders4.com

ThoughtLeaders4 Competition Magazine • ISSUE 12

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DR RACHAEL KENT VS. APPLE INC. AND APPLE DISTRIBUTION INTERNATIONAL LTD

Authored by: Charlie Xie (Director), Louis Dudney (Global Leader, Risk Advisory Partner & Managing Director), Derek Holt (Partner & Managing Director) & Michael Davis (Director) - AlixPartners

Overview

of approximately 36 million iPhone and iPad users in the U.K. against Apple for its App Store practices. The case centred on allegations that Apple abused its dominant position, infringing Chapter II of the Competition Act 1998 (the “1998 Act”) and Article 102 of the Treaty on the Functioning of the EU (the “TFEU”) (prior to 31 December 2020), by imposing exclusionary practices regarding alternative app stores and inapp payment services, and by charging excessive and unfair prices in the form of its up to 30% commission on app purchases, subscriptions, and in-app transactions on digital content within the App Store.

On 23 October 2025, the Competition Appeal Tribunal unanimously ruled in favour of Dr Rachael Kent, who led the collective proceedings case on behalf

AlixPartners economist Derek Holt and Forensic Accountant Expert Louis Dudney were instructed to provide independent expert advice by the

This article was produced in partnership with Hausfeld and can also be found on the Hausfeld website. Two AlixPartners experts gave evidence in the landmark case for the U.K.’s collective proceedings regime. Derek Holt and Louis Dudney’s evidence ultimately aided the Tribunal to find that Apple had breached Chapter II of the U.K. Competition Act 1998 (the “1998 Act”) and Article 102 of the Treaty on the Functioning of the EU (the “TFEU”) by charging excessive and unfair prices through its App Store.

team at Hausfeld & Co. LLP (led by Lesley Hannah), legal advisors to Dr Kent. Mr Holt’s evidence focused on whether the up to 30% commission charged by Apple on app purchases, subscriptions, and in-app transactions of digital content within the App Store was excessive and unfair, and (if so) the consequential quantification of harm to the class. Louis Dudney was instructed to assess the profitability of the App Store, which was then used to aid Mr Holt’s analysis of whether the commission was excessive. The Tribunal agreed with all of Dr Kent’s headline claims. As a result, Apple is liable for around £1.5 billion in compensatory damages and interest owed to U.K. iPhone and iPad users within the class.

ThoughtLeaders4 Competition Magazine • ISSUE 12

Central Issues and Key Findings Market Definition and Dominance: The Tribunal accepted Dr Kent’s definition of the relevant markets as the market for the distribution of iOS apps and the market for iOS in-app payment services (together, “Relevant Markets”). The Tribunal rejected Apple’s submission that it operated within a broader “system” market with competition from entities such as Google, as well as its submission that a wider “app transactions” market existed. The Tribunal found that Apple held a dominant position in both Relevant Markets throughout the Claim Period.

Exclusionary Abuse: The Tribunal agreed with Dr Kent that Apple had infringed Chapter II/Article 102 by: a) Through its practices, completely foreclosing entry to the Relevant Markets by alternative app stores and alternative in-app payment systems providers; and b) t ying Apple’s own in-app payment system to the App Store.

Objective Justification. Apple failed in its arguments that there was an objective necessity defence and an efficiencies defence to its abuse of dominance in respect of the exclusionary abuses.

a) E xcessiveness limb (Limb 1): The Tribunal accepted that Mr Dudney’s calculations of the App Store’s profitability and resulting profitability metrics were reasonably reliable estimates, finding that they showed a significant and persistent difference between the price of services provided and the costs of those services over the Claim Period. b) U nfairness limb (Limb 2): The Tribunal found that the commission was unfair both vis-à-vis in itself, and vis-à-vis comparators. The Tribunal noted that, although Apple does provide value to developers through the App Store, it was not satisfied that the level of these benefits could in itself reasonably be taken to explain the very high profitability of the App Store. The Tribunal also acknowledged that the comparators put forward by Mr Holt provided some indication of what a reasonable benchmark for app distribution commission might be if it had been set in conditions of workable competition.

Incidence/Pass-on: By taking into account all the evidence, the Tribunal applied a rate of 50% of incidence of the overcharges upon consumers, across the developer population.

Quantum: The Tribunal concluded that the commission for iOS app distribution services should have been 17.5% (compared to the current rate of up to 30%) and the commission for iOS in-app payment services should have been 10% (compared to the current rate of approximately up to 30%). Consequently, approximately £1.5 billion in compensatory damages and interest is due to the class.

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Expert Evidence and Conclusions Overall, the Tribunal found Derek Holt’s evidence was “helpful” and “careful and considered”. Mr Holt was supported by other AlixPartners economists including Mat Hughes, Charlie Xie, Pablo Florian, Alexandre Carbonnel, Paula Marco, and Yidan Xu, as well as colleagues from AlixPartners’ disputes and valuations practice. Louis Dudney’s analysis and findings regarding the profitability of the App Store were accepted by the Tribunal. Specifically, the Tribunal found Mr Dudney’s evidence to be “very helpful” and Mr Dudney to be “a precise and careful witness [who] explained his position well”. Mr Dudney was supported by Michael Davis, Robert Horn, and Rebecca Carfi within the AlixPartners disputes and valuations practice. This case is the first case brought under the U.K.’s collective proceedings regime to reach a successful conclusion at trial, which is viewed as a “landmark victory”, quoted from Dr Kent –

“not only for App Store users, but for anyone who has ever felt powerless against a global tech giant”.1 The full judgment can be found here: https://www.catribunal.org.uk/ judgments/14037721-dr-rachael-kentv-apple-inc-and-apple-distributioninternational-ltd-judgment-0

Excessive Pricing: The Tribunal found that Apple abused its dominant position by charging excessive (under the Limb 1 analysis) and unfair (under Limb 2 analysis by reference to it being unfair in itself and by reference to comparators) prices by its use of an up to 30% commission on every purchase of digital content made through the App Store.

https://www.kcl.ac.uk/news/dr-rachael-kent-wins-historic-case-against-apple-in-1.5-billion-collective-action

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ThoughtLeaders4 Competition Magazine • ISSUE 12

60 SECONDS WITH... LACHLAN SYKES HEAD OF LEGAL & COMPLIANCE

ANGIEON GROUP

o you have a New Year’s D Resolution, and if so, how do you plan to keep it?

hat’s your go to relaxing W activities to destress after a long day at work?

hat is one important skill W that you think everyone should have?

t the risk of sounding like a A goody two-shoes, I’m staying with last year’s resolution of not drinking alcohol. Planning to keep this up for the foreseeable.

laying the guitar, whether its P practicing something technical or just lazily noodling around some 12-bar blues. It engages a different part of the brain and it’s great to get lost in something non-digital.

Brevity.

hat are you looking W forward to in 2026?

hat motivates you most W about your work?

025 was very much a build 2 year for AGI, specifically laying solid foundations on several fronts. An area that I’m particularly excited about is building on our distribution success to date across Europe for UK distributions.

he people. I’m very fortunate T to work with some incredibly smart people at Angeion on both sides of the pond. In the London office, I work closely with Tom and Jade, and they are not only bright and highly experienced, but also terrific fun.

hat has been your most W memorable experience during your career so far? robably in 2016 when I P founded a disputes consultancy. It was literally started from the kitchen table and was the realisation of a long-term dream. It was both exciting and terrifying in equal measures.

hat is one work related W goal you would like to achieve in the next five years? I ’d like to help design and implement proprietary technology that is a true game changer for European regimes (streamline workflows, reduce costs, and enhance client experience). Angeion’s c-suit are genuinely supportive of innovation, so AGI is a great place to do this.

here has been your W favourite holiday destination and why? akhla in the disputed territory D of Western Sahara. The coastline forms a peninsula which is perfect for kitesurfing.

hat’s the strangest, most W exciting thing you have done in your career? any years ago I worked on M the investigations side of dispute resolution. Asset recovery led me to colourful jurisdictions with some highly exotic characters. But alas, I’m a poor storyteller.

hat book do you think W everyone should read, and why? “ One Day in the Life of Ivan Denisovich”. It’s a masterfully written account of the Russian gulags that puts modern day-today struggles into perspective. It’s short and high impact.

Proven experience. Disciplined delivery. Expert administration for high-stakes mass litigations and redress schemes. With roots in an established global settlement administration network, Angeion Group International provides trusted administration services across the UK, EU, and beyond. Delivering bespoke solutions that balance cutting-edge innovation, rigorous governance, and essential human expertise instils complete confidence in process, integrity, and outcomes.

Learn more at angeiongroup.co.uk

Bookbuilding • Notice Proceedings • Distributions • Voluntary Redress angeiongroup.com

ThoughtLeaders4 Competition Magazine • ISSUE 12

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AI IN CLAIMS MANAGEMENT

BETWEEN HYPE AND HARD REALITY Authored by: Jade Tess Weiner (Vice President of Business Development) & Sam Cave (Security and Compliance Officer) Angieon Group International At a recent industry conference, a panel of mass litigation claims consultants was asked a timely question: How is artificial intelligence changing your business? The responses were polite and optimistic but thin on specifics. One panellist mentioned that AI had helped their firm write better emails. The exchange revealed something important about the current moment in the claims consulting sector: while the potential of AI is widely acknowledged, its secure, ethical, and practical integration remains at an early stage. Claims consulting operates at the intersection of legal process, data management, and fiduciary responsibility. Consultants handle highly personal claimant information under strict judicial oversight. This environment fosters both opportunity and caution with respect to advanced technologies. Automation and AI can enhance speed, reduce administrative burden, and improve accuracy, yet they also introduce new risks around data protection, security, and compliance.

The AI landscape that the industry must navigate is uneven and fastmoving. Most existing systems rely on vast datasets and cloud-based infrastructure controlled by a small number of major providers. For claims consultants bound by data protection laws and confidentiality requirements, this presents real challenges. Uploading personal data belonging to clients or claimants to open-source AI tools or third-party systems (outside a controlled environment) can expose firms to potential breaches of privacy, contractual violations, and reputational harm. In this context, responsible innovation is not about racing to adopt technology but about adopting it wisely and securely.

The Regulatory Horizon: The EU Artificial Intelligence Act Global regulatory momentum is now beginning to catch up with AI adoption. The European Union’s Artificial Intelligence Act entered into force in August 2024. Its obligations apply on a phased basis, with most provisions taking effect by August 2026 (except for Article 6(1) - classification of high-risk AI system). Once fully implemented, the Act will establish the world’s first comprehensive legal framework regulating the use of artificial intelligence. The Act categorises systems by risk level and imposes strict obligations on developers and deployers, particularly in high-risk contexts such as consumer protection and financial data processing. For claims consultants, this development has immediate relevance. Tools used in claims evaluation, fraud detection, data analysis, or claimant

ThoughtLeaders4 Competition Magazine • ISSUE 12 communication could fall within regulated categories. Firms will need to demonstrate that any AI system they use meets standards for transparency, human oversight, and data governance. Even organisations outside the EU will be affected, as the Act is likely to influence global best practices and contractual obligations within crossborder claims administration.

Where AI Can Truly Help While caution is essential, there are several areas where AI can already support claims consultants in safe, practical, and productive ways. • Coding and Workflow Design: Lowcode and no-code AI tools can help consultants automate repetitive steps in case management and reporting workflows without exposing data to external systems. This allows small teams to build secure internal tools that boost efficiency and reduce manual error. • Document Classification and Summarisation: AI models can sort, tag, and summarise non-confidential claimant documents, accelerating internal reviews and freeing consultants to focus on strategic decision-making. • Communication Enhancement: Natural language systems can support high-quality client correspondence by refining tone and clarity for specific segments of claimants (for example where there are accessibility concerns) while keeping personal data within protected environments. • Fraud Detection and Pattern Recognition: Machine learning algorithms can detect irregularities across large data sets, flagging potential duplicate claims or inconsistencies that warrant human review and intervention. • Behaviour Analysis: Insider threats and advanced fraud can be difficult to detect, but subtle changes in staff, client, or claimant communication and behaviour can signal areas requiring further investigation. AIenabled platforms (e.g., Microsoft Purview with AI add-ins) or analysing conversations and email threads with an LLM can help identify language shifts, out-of-character requests, and potential red flags.

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• Analytics and Performance Insights: AI-driven dashboards can provide real-time visualisation of claims progress, participation levels, and key performance indicators, anticipating issues before they escalate, while transparently communicating workflow progress. • Translation and Language Support: AI-powered translation tools now enable multilingual communication with claimants, law firms, and courts, promoting clearer engagement across jurisdictions and improving accessibility for class members. These practical applications show that AI, used responsibly, can enhance accuracy, speed, and accessibility without compromising data integrity or professional obligations. When implementing AI or large language model systems for fraud detection, behaviour analysis, or translation, you may handle sensitive information. You should ensure that all inputs are anonymised by changing names and removing email addresses or other PII. This ensures that, if a breach occurs on the platform, any inputs or outputs are effectively hypothetical or meaningless to an interceptor. In all cases, conditions, and controls in line with the claims consulting company’s AI and governance policies must be strictly adhered to.

Beyond the Buzz The industry must also remain alert to the risk of “AI washing.” This growing phenomenon involves branding existing systems as AI-driven for marketing purposes, without meaningful technological substance or measurable outcomes. For claims consultants, transparency about how AI tools actually function is vital. Effective governance requires open disclosure: what data is being used, how outcomes are validated, and which human reviews remain in place. In a highly regulated environment built on public and judicial trust, clarity is not optional; it is essential.

A Balanced Future As the boundaries of AI evolve, the industry’s approach must remain grounded in security, ethics, and realism. Some firms are exploring closed-system AI built within strict compliance frameworks, keeping all data and model training in-house. Others are enhancing existing systems with selective automation, maintaining full human supervision over decisions that affect claimants or financial transactions. Both strategies reflect a core truth: efficiency gains are valuable only when built on transparency and accountability. Responsible adoption will demand more than technological curiosity. It will require a clear-eyed understanding of both the promise and the limitations of AI, alongside an appreciation of the regulatory frameworks that now define its use. The EU Artificial Intelligence Act signals a turning point where responsible governance and innovation must progress together. As claims consultants prepare for this next phase, success will depend not on the breadth of technology adopted, but on the depth of responsibility with which it is applied. AI can help the industry do its work more efficiently, inclusively, and intelligently. The challenge is to ensure it does so without eroding the very trust that underpins the profession. Practical controls that govern how AI systems are selected, deployed, and monitored shift AI from a “black box” tool to a governed capability. In practice, this is usually evidenced through three interlocking disciplines: human oversight, data governance, and vendor due diligence. The future of claims management may be more digital, but it must also remain ethical, human-centred, and secure.

The Global Merger Control Forum - 2nd Annual 12 May 2026 DoubleTree by Hilton Brussels

For Partnership enquiries please contact Helen on +44 (0) 20 3433 2281 or email helen@thoughtleaders4.com Complimentary attendance is available for in-house counsel

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ThoughtLeaders4 Competition Magazine • ISSUE 12

DISCLOSURE AT SCALE

PROPORTIONALITY AND THE CHANGING SHAPE OF DISCLOSURE Authored by: Dan Heinrichs (Associate Director of Consulting) - Sky Discovery Disclosure was once regarded as a largely mechanical, industrial exercise. In many cases, large volumes, broad collections, extensive searches, dozens of letters arguing technical minutiae and, more frequently than most would like to admit, thousands of hours of document review were accepted as par for the course. That mindset has been under pressure for some time. The courts have long emphasised proportionality, including with the introduction of a framework for issue-led, proportionate disclosure in the Business and Property Courts (PD57 AD). While the CAT, and many group claims in the High Court aren’t subject to PD57 AD, they have pushed disclosure to a scale that exposes the limits of traditional approaches. Long timeframes, multiple parties and complex data landscapes are now being scrutinised through a lens increasingly focused on cost, justification and design. Disclosure has not become more important because the rules have changed, but because the cases have. Managing disclosure in group claims is no longer a topic left to the parties; it is increasingly becoming a topic that the courts and the CAT (and other tribunals) 1

take an active role in steering, insisting on the use of technology and effective review workflows to ensure proportionality.

PD57 AD: An Established Framework Under Review While PD57 AD did not introduce proportionality to disclosure, it reinforced the long-established overriding principle of dealing with cases in ways which are proportionate (CPR 1.1 (2)(c)). Alongside simplified Case Management and early cooperation between parties, the explicit aim was to get a handle on everexpanding costs. For several years now, parties in the Business and Property Courts have been required to articulate the issues that genuinely require evidential support, to explain how they propose to search for documents and to provide estimates of the likely costs. The menu of Extended Disclosure Models was designed to discourage default reliance on wideranging searches, with the widest option available, full train-of-enquiry disclosure (Model E), expressly described as

https://www.judiciary.uk/courts-and-tribunals/high-court/technology-and-construction-court/news/

exceptional. Additionally, in a shift from previous directions, PD57 AD increased the focus on the use of technology, requiring parties to explain why they would NOT use it for matters requiring the review of over 50,000 documents. Despite the increased focus on technology, three-year-old PD57 AD, its processes and documents already feel slightly antiquated with the rise of GenAI offering significant advances in document review. It seems the Disclosure Review Working Group under the chair of Justice Butcher may feel the same. In a recent survey of practitioners, the questions focussed on whether the directions have helped decrease, or inadvertently increased, costs. The frequency in use of technology, including AI and potential requirement for further guidance on the use of technology take up a large proportion of the questions, too.1 The survey and its questions reflect a growing concern that proportionality must do more than exist in principle, and that technology is seen as a key factor in ensuring costs are managed – without losing sight of the actual purpose of disclosure, the uncovering and exchange of key evidence.

| Litigation|

ThoughtLeaders4 Competition Magazine • ISSUE 12 While PD57 AD is currently limited to the Business &Property Courts, it exemplifies the thought processes of Justices. In cases of increasing scale and complexity, Disclosure, its processes, technologies and costs, must be capable of withstanding scrutiny from courts, clients and funders alike – including in Group Claims.

Disclosure in Group Claims In Group Claims, allegations often stretch back years, sometimes decades and include large numbers of employees, who are often no longer employed. Data is stored across multiple legacy platforms, shared drives, email archives and specialist business systems, frequently with limited consistency. In that environment, it is easy for disclosure to grow by default. Conservative scoping decisions, taken in isolation, can quickly combine to produce vast datasets. Review volumes escalate, costs rise sharply, and timetables are strained. What might once have been tolerated as the price of complexity, increasingly requires sophisticated case management and deployment of technology. The difficulty is not simply volume, but the way in which volume obscures focus. When disclosure becomes too broad, it risks diverting time and resources away from the issues that actually matter to the determination of the case. That is a concern not only for parties and funders, but for courts tasked with managing increasingly complex proceedings efficiently.

Proportionality in the CAT: Gormsen v Meta The CAT’s approach in Gormsen v Meta provides a useful illustration of how proportionality is now being applied in large collective actions. 2

Faced with disclosure proposals that would generate substantial volumes of material across multiple custodians, the Tribunal focused on process rather than raw numbers. Volume alone was not treated as decisive: Meta explained that searches were producing around 2.4 million documents, yet the Tribunal was not persuaded that the scale of those figures, on its own, meant the exercise was disproportionate. Crucially, the Tribunal proceeded on the basis that modern disclosure assumes the use of appropriate technology. It further emphasised the importance of clear protocols, sensible sequencing and early resolution of disputes before large-scale review commenced. At the same time, the Tribunal made clear that proportionality does not justify unfocused searches. It warned against “kitchen sink” approaches and required parties to justify requests with precision, often through structured, Redfern-style schedules.2 The case demonstrates a balanced approach. Disclosure is neither curtailed simply because it is difficult, nor permitted to expand unchecked. Instead, parties are expected to show that they have thought carefully about scope, method and cost, and that they are using the tools available to them responsibly.

Looking Ahead: Cost, Funding and the Role of Technology Commercial realities have sharpened this focus. Litigation funding, particularly in collective proceedings, has brought costs into the foreground. Disclosure budgets are examined closely and defined in far more detail, much earlier in matters than in the past , and inefficiency is harder to justify. A developing trend we are seeing at Sky Discovery is funders being actively involved in the review of the abilities of eDisclosure providers to provide value for money. Workflows, expertise and, of course, the use of AI are scrutinised in detail, in a recent case even before funding was agreed in principle. Uncertainty in the funding landscape since PACCAR has only heightened this sensitivity.

Against that background, technology is increasingly seen not merely as a means of managing volume, but as a way of making large-scale litigation viable at all. Tools such as Predictive Coding (“TAR”) and more advanced analytical techniques have already proven their value in supporting proportionate disclosure by reducing review burdens, improving consistency and allowing issues to be tested earlier. The introduction of AI has shown enormous promise in enabling legal teams to review millions of documents in a matter of days rather than years, while improving accuracy and reducing cost significantly. The question is no longer whether such tools should be used, but how they can be deployed responsibly, transparently and in a way that supports proportionality and fairness. Used well, technology can do more than control cost. It can facilitate access to justice by enabling claims - and defences - that might otherwise be unaffordable or unmanageable. The challenge lies in ensuring that its use is informed by legal judgement and technological expertise rather than driven by novelty.

Conclusion The direction of travel is clear. The framework for proportionate disclosure has been in place for some time, but the pressures now being placed on it are intensifying. For practitioners, the response must be thoughtful rather than reactive. Proportionality requires early engagement with the data, realistic scoping decisions and a willingness to design disclosure exercises that can be explained and defended. Technology, including AI, has an important role to play, but it is most effective when deployed as part of a considered strategy rather than as a bolt-on solution. As group litigation continues to test the limits of traditional approaches, disclosure will increasingly turn on judgement — and on the ability to combine legal insight with technical understanding to keep even the largest cases on a proportionate footing.

https://competition.today/2025/12/16/gormsen-v-meta-disclosure-scope-settled-as-tribunal-moves-case-into-execution-phase/

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ThoughtLeaders4 Competition Magazine • ISSUE 12

| Litigation|

EVANS V BARCLAYS

SUPREME COURT PUTS MERITS BACK ON THE TABLE Authored by: Barney Stannard (Director), Joseph Moore (Partner) & Charles Keen (Trainee Solicitor) - Travers Smith

Introduction The UK Supreme Court has overturned the Court of Appeal’s decision in the Evans CPO, reinstating the Competition Appeal Tribunal’s (CAT) ruling that the proposed collective proceedings, following regulatory findings of collusive and anti-competitive conduct among major banks in the foreign exchange (FX) market, should proceed by way of an opt-in (rather than opt-out) basis. In doing so, the Supreme Court concluded that a claim’s merits are relevant to whether it should be allowed to be certified on an opt-out basis and that, generally speaking, where a claim could practicably be brought as an opt-in then this will be a factor against certifying on an opt-out basis. This is a major decision, which has the potential to reshape the battle lines at the certification stage of future CPOs. Over the past two years, defendants have (generally) moved away from broad merits challenges, on the basis that – at least on that ground – the low bar to certification made it strategically advantageous to focus fire on more procedural matters. Not unrelatedly,

almost all certified CPOs have been made on an opt-out basis. Post-Evans there is again a substantial incentive for defendants to attack claim merits, and to focus energy on the opt-out versus opt-in issue. This could well lead to very different certification hearings, and also to a more balanced blend of certification decisions.

The Decisions of the CAT and the Court of Appeal The cases concerned the CAT’s gatekeeper role, specifically in deciding whether any collective action should be opt-in or opt-out, considering all relevant circumstances, but with specific regard to (a) the strength of the claims, and (b) whether opt-in proceedings are practicable, especially in view of the likely damages for each class member.

Mr Evans’ proposed action relied on the European Commission’s findings that certain banks’ traders exchanged sensitive FX information (via chatrooms), allegedly resulting in widespread financial harm by enabling the traders to widen bid-ask spreads. The class of claimants was large and highly heterogeneous, ranging from global financial institutions to individuals. The CAT found the claim to have weak merits, due to fundamental problems on the issue of causation: the pleaded case did not provide a plausible explanation of how the identified misconduct caused the losses alleged across the entire class, particularly where claimants had no direct link to specific unlawful trades. While not striking the claim outright, the CAT concluded it was too weak for opt-out status, noting that major institutional claimants were uninterested in an opt-in claim and the residual claimants’ losses were small collectively. The Court of Appeal overruled this aspect of the decision, holding that claim strength should generally be a neutral factor on the opt-in/opt-out question.

ThoughtLeaders4 Competition Magazine • ISSUE 12

3. Policy Factors: “Facilitating the vindication of rights and deterring future wrongdoers” are important policy aims, but these do not override the need for a fair and proportionate balance.3 It is this balance of these policy aims, with the concerns about the “leveraging effect”, which led the Supreme Court to consider that there should be no general presumption or preference for either opt-in or opt-out.

Supreme Court Ruling The Supreme Court reinstated the CAT’s refusal to certify Mr Evans’ claim on the opt-out basis. Four aspects of the Supreme Court’s decision warrant particular attention:

1. Strength of Claim: The CAT was right to treat the apparent weakness of a claim as a powerful factor weighing against certifying on an opt-out basis, given the procedural leverage of opt-out actions. The claim’s inability to plead a plausible theory of harm should not be considered a neutral factor, since it increases the risk that defendants will be forced to settle unmeritorious claims due to the sheer scale and cost of opt-out collective proceedings, and the “leveraging effect” gained by adding to otherwise substantial claims the value of a very large number of small claims. The CAT is entitled to take a “sliding scale” approach: the weaker the case, the less justified opt-out becomes.1

4. Use of Third-Party Decisions: The Court of Appeal erred in treating findings against third parties (in particular, the Sterling Lads Commission decision against Credit Suisse) as relevant to this case. Such findings are inadmissible as evidence against other defendants and should have no probative value in these proceedings. In reaching this conclusion, the Supreme Court reaffirmed the rule in Hollington v Hewthorn, holding that, contrary to the Court of Appeal, this rule did apply in the CAT (save potentially in interlocutory proceedings). It concluded that rule applies with particular force where defendants had no opportunity to participate in the prior proceedings, making it fundamentally unfair to admit such findings against them.4,5

| Litigation| the merits are more questionable, (many) more of those claims may now be certified as opt-in. The judgment also raises the question as to how the CAT would balance the merits and practicability factors (and many other relevant factors, as the Supreme Court emphasises) in the case of a consumer action with questionable merits, and practitioners will look on with interest as to how those scenarios are approached. More broadly, the decision would appear to have the capacity to fundamentally shift the regime. If the claim’s merits will again be fiercely contested at certification this will be likely to lead to higher costs earlier in proceedings, and potentially further delays before claims proceed to the substantive stage. Of still more importance, if more claims are certified by way of opt-in, then it may be that many do not then proceed because of the difficulties of obtaining funding for opt-ins. It will be interesting to see whether the funding industry will be able resolve that problem. Looking still more broadly, depending on how those more immediate effects evolve, the decision may also have repercussions in the current political discussions, following the recent DBT review, in shifting the perceived burden placed on companies by the regime, particularly the burden caused by weak claims. Much will therefore depend on the interpretation of the decision now adopted by the CAT.

2. Practicability: A claim that could be practicably brought as opt-in proceedings “generally…should be.” If, as here, sophisticated and well-resourced claimants would not opt in even when substantial sums are at stake, that does not make opt-in impracticable. The CAT may legitimately give less weight to the interests of small claimants whose combined financial interest is trivial compared to the main class, rather than allowing, as the CAT initially put it, the “tail to wag the dog.”2

Future Certification Decisions and Implications for the CPO Regime The Supreme Court’s judgment will affect different claims, differently. For consumer class actions, with reasonable merits, the decision may well not make too much difference, as here an opt-out claim is unlikely to be practicable. However, for businessto-business claims, or those where

1 Evans (Respondent) v Barclays Bank Plc and others (Appellants) [2025] UKSC 48 para 95 2 (1329) O’Higgins (1336) Evans - Judgment (Certification, Basis of Certification and Carriage Dispute) | 31 Mar 2022 para 381(10) 3 Evans (Respondent) v Barclays Bank Plc and others (Appellants) [2025] UKSC 48 para 168 4 Evans (Respondent) v Barclays Bank Plc and others (Appellants) [2025] UKSC 48 para 158 5 It will be interesting to see how this part of the judgment affects the putative appeal in Kent v Apple (itself a landmark decision) in which the CAT placed reliance on conclusions reached by the CMA and the European Commission, to which the defendant, Apple, were not party.

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ThoughtLeaders4 Competition Magazine • ISSUE 12

| Law |

RECENT RULING OF THE ITALIAN COUNCIL OF STATE ON THE APPLICATION OF THE DOMESTIC FDI REGIME

Authored by: Maria Rosaria Raspanti (Counsel) - Pavia e Ansaldo Studio Legale On December 5, 2025, by decision No. 9616, the Italian Council of State, national highest administrative court, issued a decision clarifying an matter of major relevance for the practical application of the national FDI regime (so-called Golden Power), set by Decree-Law No. 21/2012. By overturning a previous judgment of the Lazio Regional Administrative Court (TAR Lazio, the first-instance administrative court), the Council of State annulled the Prime Ministerial Decree of 2023 concerning the pledges granted by Cedacri over its own shares as security for a bond loan. The issue addressed by the decision, which had long caused uncertainty among practitioners, concerned whether

a pledge must be notified at the time of its mere creation where, by contractual exclusion (and therefore by way of derogation from the provisions of the Italian Civil Code), the pledge is not accompanied by administrative rights in favour of the pledgees, in particular voting rights. The TAR Lazio had previously held that even where a pledge is not associated with voting rights by agreement of the parties, its creation must nonetheless be notified pursuant to Decree-Law No. 21/2012. Therefore, according to the TAR, the mere creation of the pledge, irrespective of the transferring or retention of voting rights, triggered a duty to notify the transaction. By overturning the TAR’s ruling, the Council of State therefore narrows the range of situations subject to Golden Power notification requirements.

ThoughtLeaders4 Competition Magazine • ISSUE 12 The Council of State reached a different conclusion than the TAR’s following an analysis of the specific elements of the transaction, aimed at assessing whether the latter, as structured by the parties, did or did not result in a change in the ownership or control of strategic assets, which constitutes the prerequisite for the notification obligation. In the case of the Cedacri pledges, the Council of State held that the characteristics of the transaction did not support the conclusion that there had been any change in the ownership or control of strategic assets. As a result, the transaction was deemed irrelevant under the Golden Power regime and filing duties were therefore ruled out, within the limits explained below. First, it is worth noting that the decision does not affect the merits of the Government’s discretionary assessment, which remains intact. Accordingly, the “critical” nature of the technologies of the target company, their strategic relevance, and the fact that the company therefore falls within the scope of the Golden Power regime remain undisputed. The Council of State instead intervenes on the preliminary and objective prerequisites for the application of the legislation, which are established by the applicable laws and are not subject to the Government’s discretionary assessment. In other words, the Council of State focuses on the classification of the transaction to determine whether or not it falls within the scope of the Golden Power rules, without intervening on the merits of the critical or strategic nature of the target company. With regard to the nature of the transaction, the Council of State found that the objective prerequisite for the application of the legislation was lacking, as the Cedacri pledges had been created, in line with common market practice, excluding the automatic transfer of voting rights to the creditor. Such rights would have indeed been transferred only upon the occurrence of default events, identified in the relevant agreements. The TAR Lazio had opted for a much broader and cautious interpretation, capable of catching any transaction potentially affecting strategic assets. The Council of State, by contrast, confines the scope of application of the rules by clarifying that the creation of security interests (such as pledges) over a company’s shares is relevant, for the purposes of triggering filing duties, if and only if it entails changes in the control structure (that is, if it is

accompanied by the transfer of voting rights to the creditor). As stated by the Council of State: “[…] in cases where the owner of the shares retains the voting rights and therefore all other administrative rights until a breach of the obligations under the financing secured by the pledge occurs, it is not possible to equate the granting of a pledge with the acquisition of a shareholding in the undertaking […]”, with the result that no notification obligation arises for the mere fact of the creation of the pledge.

The relevance of the judgment is not limited to this, albeit important, aspect. It is actually broader in scope, declaring the relevance of the interpretation of the Golden Power regime in finding a balance within State and market, with a clear and explicit reference to the competition law framework. The Council of State in fact held that

| Law | Italy precisely in relation to the broad and extensive application of the Golden Power regime. It therefore does not seem excessive to deem this decision as marking the beginning of a corrective phase, at least at the judicial level. It should nonetheless be recalled that in the Cedacri case the judicial review was limited to the objective prerequisites. By contrast, in the arguably more wellknown UniCredit case – which definitely triggered the European criticisms against Italy – the dispute revolves around matters falling within the sphere of the Government’s discretionary assessment, namely the strategic nature of the target company and the Government’s consequent decision to intervene through the exercise of special powers in response to a perceived threat of serious harm to the interests of the State.

Notwithstanding the aforementioned differences, the corrective path nonetheless appears set.

“[…] there is a need to subject the Golden Power legislation, with reference to the types of resolutions, acts or transactions considered relevant, to a strict interpretation, given the need to strike a balance between the State and the market. This is because an extensive interpretation of the relevant application criteria of the Golden Power regime would place the Italian legal system in potential conflict with EU competition law.” This statement, which is undoubtedly significant, takes on even greater weight when viewed in the current European context, characterised by increasing criticism – up to and including the recent initiation of an infringement procedure – by the European Commission against

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| Law |

ThoughtLeaders4 Competition Magazine • ISSUE 12

BECCARIA AND BECKER IN CONVERSATION

BRAZIL’S ANTITRUST REFORM EXCLUDING INDIVIDUAL LIABILITY Authored by: Alessandro P. Giacaglia (Senior Associate) - Pinheiro Neto Advogados

hat Brazil’s Antitrust W Reform Seeks to Change and Why Brazil’s proposed antitrust reform, Bill No. 4,612/2025, seeks to recalibrate individual liability for cartel conduct. Currently, Brazil uses a dual enforcement system where individuals face both administrative sanctions from the antitrust authority, CADE, and criminal prosecution by the Public Prosecutor’s Office. From an administrative standpoint, managers and officers may be sanctioned with fines of up to 20% of the penalty imposed on the company (Law No. 12,529/2011, Article 37, item II), while the other individuals may be fined up to BRL 2 billion (Law No. 12,529/2011, Article 37, item III). However, in practice, individual fines are substantially lower on average. Based on CADE’s enforcement outcomes between 2023 and 2025, individual fines typically range from BRL 100,000 to BRL 400,000 (dataset extracted from CADE’s minutes of plenary sessions, 2023–2025).

In parallel, cartel conduct may lead to criminal proceedings, with prison sentences of 2 to 5 years and fines (Law No. 8,137/1990, Article 4, items I and II). This overlapping framework, designed to enhance deterrence, has been criticised for undermining efficiency and legal certainty. The bill proposes to exclude individuals from CADE’s administrative jurisdiction, to concentrate sanctions on legal entities, and to restrict criminal liability to cartel conduct. According to the bill’s explanatory memorandum, the reform aims to reduce duplicative enforcement and improve institutional efficiency. In sum, the bill proposes to: i. exclude individuals from CADE’s administrative sanctioning powers; ii. concentrate administrative sanctions on legal entities; iii. restrict criminal liability to cartel conduct; and iv. reinforce the leniency framework by emphasising criminal immunity upon full compliance with the leniency agreement.

These proposals echo arguments in Brazilian scholarship and within CADE itself, questioning whether delayed administrative sanctions against individuals, sometimes decided decades after the conduct, meaningfully enhance deterrence. In Case No. 08700.003528/2016-21, Commissioner Carlos Jacques highlighted the practical difficulties of pursuing individuals administratively, including challenges with notification in international cases and proceedings that reach final decisions decades after the underlying conduct. Recent enforcement data adds empirical texture. Between 2023 and 2025, approximately 40% of individuals who avoided final sanctions did so through leniency or settlement agreements (TCCs). Although fines against individuals (approximately R$42 million) accounted for only about 5% of the total fines CADE applied during this period (roughly R$850 million), the data suggest that the prospect of individual liability is a key driver of cooperation. As I have previously argued in The Effects of Leniency Compliance in Brazilian Antitrust Law (IBRAC

ThoughtLeaders4 Competition Magazine • ISSUE 12 Magazine, vol. 18, 2010), the effectiveness of Brazil’s leniency programme depends on legal clarity and predictable outcomes. Against this background, the bill frames the exclusion of individual administrative liability as a structural choice about how deterrence should be delivered. It would be instructive to imagine an exchange of letters between Cesare Beccaria, concerned with the legitimacy and proportionality of punitive power, and Gary Becker, who introduced an instrumental, rational approach to the analysis of crime, centred on incentives and efficiency. This article adopts that intellectual premise to contrast two distinct, though not necessarily antagonistic, views on how best to deter anticompetitive conduct, considering Bill No. 4,612/2025. Despite their distinct starting points, both perspectives converge on the importance of predictability: for Beccaria, as a condition of legitimate punishment; for Becker, as a determinant of effective deterrence. This shared concern helps explain the central role of clarity and legal consequences in the design of enforcement mechanisms.

This concern with legitimacy and coherence does not exclude deterrence. On the contrary, more explicit institutional allocation and more timely sanctions may indirectly enhance deterrence by strengthening compliance expectations and reinforcing the credibility of enforcement. In this sense, legitimacy and deterrence are not opposing goals but operate through different normative channels. From this perspective, the idea that individual administrative liability is no longer fit for purpose seems less radical. A dual-track enforcement system may formally increase penalties but simultaneously erode legal certainty and institutional focus. Empirical evidence shows that pursuing individuals administratively increases procedural delays and complexity, which can weaken deterrence and undermine enforcement efficiency, key concerns for policymakers and practitioners. Therefore, one could conclude that the administrative enforcement should remain focused on legal entities, while individual culpability is better suited to the criminal justice system. Excluding individual administrative liability is not a retreat from enforcement, but an attempt to realign sanctions with their proper institutional domains.

A Letter from Beccaria: Legitimacy, Proportionality, and Institutional Focus

A Letter from Becker: Deterrence, Probability, and the Risk of Substitution

I write from Italy, speaking from the eighteenth-century intellectual context in which these ideas were forged, and addressing both Professor Becker and the Brazilian Congress in 2026.

I write from the United States, from the late twentieth-century economic analysis of crime that placed incentives and probability at the centre of deterrence, addressing you and the Brazilian Congress in 2026.

Punishment derives its authority from clarity, proportionality, and timeliness. Delays in sanctions or overlapping sanctions between institutions risk undermining their legitimacy. When punishment becomes fragmented or overly procedural, it loses its normative force.

| Law | Viewed through this lens, the reform presents a risk. By removing individual administrative liability, the bill substitutes one enforcement channel for another. Shifting to a harsher but potentially rarer criminal channel may reduce deterrence if it lowers the overall probability of sanctions. The data is instructive. Nearly 40% of individuals avoided final administrative sanctions through leniency or settlement agreements, suggesting that the threat of such liability was a key incentive for cooperation. In practice, criminal enforcement is subject to higher evidentiary thresholds and prosecutorial constraints. These factors may lead to fewer sanctions, thereby reducing the expected probability of punishment despite higher statutory penalties. Relying exclusively on criminal enforcement is an institutional wager. If it cannot replicate the previously generated sanction probability, the expected cost of cartel participation may fall.

Conclusion: An Institutional Trade Off, Not a Binary Choice The virtual exchange between Beccaria and Becker shows that Brazil’s reform should not be assessed in binary terms. The bill neither dismantles individual accountability nor offers a simple upgrade to cartel enforcement. Instead, it reflects a deliberate institutional trade-off. The reform addresses real shortcomings of the dual-track enforcement system. Still, it also replaces a system that demonstrably induced cooperation with one whose effectiveness remains empirically uncertain. Whether this wager strengthens or weakens cartel deterrence will ultimately depend on how criminal enforcement performs in practice.

From an economic perspective, deterrence is paramount: the expected cost of wrongdoing must exceed its expected gains. Within this framework, the certainty of a sanction typically has a more substantial deterrent effect than its severity.

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ThoughtLeaders4 Competition Magazine • ISSUE 12

PORTUGUESE MERGER CONTROL

FOREIGN JOINT VENTURES AND LOCAL NEXUS Authored by: Philipp Melcher (Partner), Beatriz Lopes da Silva (Associate) & Joana Fraga Nunes (Associate) - Morais Leitao

Introduction According to the 2005 OECD Recommendation on Merger Review1, countries should “[a]ssert jurisdiction only over those mergers that have an appropriate nexus with their jurisdiction”. As per the ICN Recommended Practices for Merger Notification and Review Procedures, that the nexus “should be based on activities within the jurisdiction, as measured by reference to the activities of at least two parties to the transaction and/or of the acquired business in the local territory”.2 Moreover, “in transactions involving more than two parties, application of the “each of at least two parties” threshold should be adapted to the type of transaction to ensure that notification is required only when the transaction has a material nexus to the reviewing jurisdiction. An important example is the formation of a joint venture. Even if two or more of the parties forming the 1 2 3

joint venture have significant activities in the jurisdiction, the proposed joint venture transaction is unlikely to have a material nexus to the jurisdiction unless the proposed joint venture will have significant assets in or sales in or into the reviewing jurisdiction.”3. The Portuguese merger control regime provides in Article 37(1) of Law No. 19/2012 (Portuguese Competition Law, PCL) for three alternative mandatory notification thresholds: (i) a pure domestic turnover threshold (requiring that all undertakings concerned generate more than € 100 million in Portugal and each of at least two of them individually more than € 5 million); (ii) a pure domestic market share threshold (requiring that the transaction leads to an acquisition, creation or reinforcement of a market share of 50% or more in Portugal); and (iii) a mixed threshold (acquisition, creation or reinforcement of a market share of 30% or more in Portugal, if each of at

least two of the undertakings concerned individually generate more than € 5 million in Portugal). In addition, Article 2(2) PCL determines that “(…) this law shall apply to (…) mergers between undertakings which take place in the national territory or have or may have effects therein.”. In the case of the creation of a joint venture (acquisition by two or more undertakings of joint control over another undertaking), if the revenues of the acquirer groups (qualifying as “undertakings concerned”) meet the domestic turnover threshold, such transactions would have to be notified to the Portuguese Competition Authority (PCA) even if the joint venture does not have and is not likely to have any activity in Portugal, unless Article 2(2) PCL were to exclude them from the ambit of Portuguese merger control, for not being liable to produce any effects in Portugal. The PCA had to decide this question in three recent cases.

OECD Council, Recommendation on Merger Review, 23 March 2005, Recital II.6. ICN Recommended Practices for Merger Notification and Review Procedures, Working Group Comments September 2002, June 2003 and May 2017, Recital II. C. Comment 1. Idem, Comment 3.

ThoughtLeaders4 Competition Magazine • ISSUE 12 to the above, not only did the joint venture not (and was not likely to) have any presence or activities in Portugal, but there was also no horizontal or vertical relationship between the activities of the joint venture outside of Portugal and the activities of its parent companies in Portugal.

PCA Decisions The first decision concerned the acquisition by Teak and Tangor, two separate Portugal-based groups with investments across different industries, of joint control of the Italian Vetrerie Riunite group (manufacturer of glass doors for washing and drying machines).4 The PCA concluded that the transaction was notifiable, since the domestic turnover generated by Teak and Tangor met the pure turnover threshold (considered by the PCA to evidence that the transaction may have an effect in Portugal within the meaning of Article 2(2) PCL, thereby establishing the required local nexus). This was possible only insofar as the PCA attributed to each of Teak and Tangor 50% of the turnover achieved in Portugal by two other groups, which, in the PCA’s assessment, were jointly controlled, on a de facto basis by them: BA Glass, a manufacturer of glass packaging for food and beverages and Cerealis, active in the manufacture of cereal products. The local nexus was established despite the fact that Vetrerie Riunite did not and was not likely to have any presence or activities in Portugal (a fact deemed by the PCA to be “neutral” in this context) and that neither Teak nor Tangor had any activity (direct or indirect) in Portugal bearing any horizontal or vertical relationship with the activity of the target (Vetrerie). The PCA reconfirmed this understanding in a case which concerned the creation of SAS “Repenser la ville”, a joint venture for urban renewal projects in France, by Caisse des Dépôts et Consignations (CDC), a French public undertaking with activities, inter alia, in Portugal (e.g., public transport, postal services, personal insurance), and Frey, a French company group active, including in Portugal, in the development of open-air shopping centres.5 In that case, similarly

The third case involved acquisition by Proximus, a Belgium-based telecommunications and information technology services provider, active also in Portugal, and AGI, a company of the Belgium-based Ageas Group, provider of insurances and healthcare services, including in Portugal, of joint control of Doktr, a Belgiumbased company providing medical teleconsultation services in Belgium.6 Again, the PCA considered the meeting of the pure turnover threshold by Proximus and AGI to be sufficient to confirm the notifiability of the transaction and to be irrelevant in this context the fact that the joint venture did not and was not likely to have any presence or activities in Portugal. In all three cases, the PCA cleared the transaction in the simplified procedure, concluding that it was not liable to have any effects on competition in Portugal.

| Law | It would therefore appear to be more adequate to interpret the pure domestic turnover threshold in Article 37(1) in light of Article 2(2) PCL, in the sense of considering the threshold not to be met in case of the creation of a foreign joint venture without any presence or activities in Portugal, at least where there is no horizontal or vertical relationship between the activities of the joint venture outside of Portugal and the activities of its parent companies in Portugal (in which case the transaction cannot have any impact on competition even if the geographic scope of the markets concerned is wider than national). Other competition authorities have adopted a similar approach, for example the German Competition Authority.8 Another option could be to interpret the pure turnover threshold in the sense that one of the undertakings concerned with individual domestic turnover in excess of € 5 million must be the joint venture, as potentially problematic foreign joint ventures would still be caught by the mixed and pure market share thresholds. However, until the notification thresholds or their interpretation by the PCA are revised, transaction parties should abide by the current decision practice to avoid violating the notification and standstill obligations of the Portuguese merger control regime (which are proactively enforced by the PCA, including by screening market information for notifiable transactions) and the payment of a potentially significant fine.

Comment The interpretation adopted by the PCA departs from OECD and ICN recommendations, requires it to use its scarce resources (inefficiently) for the analysis of transactions that cannot (or are at least very unlikely to) have any effect on competition in Portugal and imposes unnecessary costs (including time and financial resources, e.g. for the payment of a filing fee between 7.500 and 25.000€) on notifying parties (while the European Commission follows the same approach as the PCA7, notifications to it are at least not subject to a filing fee).

4 Decision of the PCA dated 06.12.2023 in case Ccent. 66/2023 - Teak*Tangor/VOV. 5 Decision of the PCA dated 27.02.2024 in case Ccent. 10/2024 - CDC*FAP / SAS. 6 Decision of the PCA in case Ccent. 70/2025 - Proximus*AGI*NHF / Doktr, 17.09.2025. 7 Commission Notice on a simplified treatment for certain concentrations, OJEU 2023 C 160/1, recital 5.(a): “Two or more undertakings acquire joint control of a joint venture, provided that the joint venture has no current or expected turnover within the territory of the European Economic Area (EEA), and the undertakings concerned have not planned to transfer any assets within the EEA to the joint venture at the time of notification”. 8 German Competition Authority, Guidance on domestic effect in merger control, 2014.

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ThoughtLeaders4 Competition Magazine • ISSUE 12

OVERVIEW OF RECENT UPDATES

IN EU FOREIGN INVESTMENT, FOREIGN SUBSIDIES AND MERGER CONTROL Authored by: Melanie Bruneau (Partner), Nikolaos Peristerakis (Partner) & Antoine de Rohan Chabot (Counsel) K&L Gates Brussels

Introduction European Union’s increasingly evolving regulatory approach at the intersection of competition, trade and national security has important practical implications for investors, international groups, and transaction planning across the EU and globally. There are three key EU developments to watch on the regulatory front in 2026 which can affect M&A transactions and public procurement in the EU: • t he political agreement reached in December 2025 on the revision of the EU Foreign Direct Investment (FDI) Screening Regulation; • the European Commission’s Guidelines of January 2026 clarifying the application of the EU Foreign Subsidies Regulation (FSR); and • the ongoing revision of the EU merger control guidelines. These initiatives illustrate the increased regulatory scrutiny of cross-border transactions and investments in the EU,

which are no longer limited to merger control but also include national security consideration (through FDI) and trade considerations (through the FSR).

Reinforcement and Harmonisation of the EU FDI Screening Framework Regulation (EU) 2019/452 of 19 March 2019 establishing a framework for the screening of foreign direct investments into the Union (the EU FDI Screening Regulation) applies since 11 October

2020. Adopted against the backdrop of concerns that the COVID-19 crisis could trigger predatory acquisitions of strategically important but undervalued EU companies, the EU FDI Screening Regulation aimed to encourage EU Member States to establish national FDI screening mechanisms, to create a cooperation mechanism between the European Commission and the EU Member States, and to establish minimum requirements for national screening regimes in relation to security and public order. On 11 December 2025, the European Parliament and the Council reached a political agreement on a set of substantial amendments to the EU FDI Screening Regulation. The objective of these amendments is to further harmonise the EU FDI screening framework and make it more effective, while at the same time increasing predictability for businesses. Final adoption of the revised EU FDI Screening Regulation is expected in the first half of 2026, with an entry into force that could be anticipated towards the end of 2027.

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ThoughtLeaders4 Competition Magazine • ISSUE 12 The key elements of the revised EU FDI framework are the following:

Mandatory National Screening Mechanisms EU Member States will be required to adopt and maintain national FDI screening mechanisms. The scope of such mechanisms will cover certain intra-EU investments where the EU investor is ultimately owned or controlled by a third-country person or entity.

Harmonised Minimum Sectoral Scope National screening regimes must, at a minimum, cover investments in the following sensitive areas: • dual-use items and items listed on the EU Common Military List; • entities involved in the manufacture, research, or development of semiconductors, quantum technologies, or artificial intelligence technologies; • entities active in transport, energy, or digital infrastructure that are considered critical by the relevant Member State; • entities engaged in the exploration, extraction, processing, recycling, recovery, or stockpiling of strategic critical raw materials; and • specific categories of financial service providers, such as central counterparties, central securities depositories, regulated market operators, payment system operators (excluding central banks), other systemically important institutions.

Minimum Procedural Standards The revised Regulation introduces harmonised procedural requirements applicable to national screening regimes, including: • a two-phase review process; • the power to screen non-notified transactions retroactively; • harmonised review timelines, notably a 45-calendar-day deadline for the initial (Phase I) review; and • for transactions in several EU Member States, filings must be submitted on the same day in all relevant jurisdictions.

Enhanced Cooperation Tools The revised framework introduces the creation of an EU-level database (accessible to national screening authorities), containing information on investments notified under the cooperation mechanism and the outcomes of national screening procedures since October 2020. The revised framework allows for the possible establishment of a single EU online filing portal for notifications to national screening authorities, at the request of at least nine EU Member States.

Commission Guidelines on the Application of the EU Foreign Subsidies Regulation On 9 January 2026, the Commission published its Guidelines on the application of the EU Foreign Subsidies Regulation (FSR). The FSR, according to which mandatory notification obligations started to apply on 12 October 2023, empowers the European Commission to address distortions of competition caused by foreign subsidies or other financial contributions granted by non-EU countries to companies operating in the EU to ensure a level playing field for all companies engaging in economic activities in the EU. Indeed, in the past, it appears that foreign subsidies might have distorted the EU’s internal market by providing their recipients with an unfair advantage to acquire companies or obtain public procurement contracts. These FSR Guidelines clarify several key concepts:

Assessment of Distortive Effects Once the Commission has established that an undertaking active in the EU has benefited from a foreign subsidy, it will assess whether that subsidy actually or potentially distorts competition in the EU through a two-step analysis: • First, the Commission will examine whether the subsidy strengthens the undertaking’s competitive position in the EU. Where subsidies are granted at the group level and are not specifically targeted to the group’s EU activities, the EC will assess whether the subsidy could be credibly used to cross-subsidize EU activities.

• Second, the Commission will assess whether the subsidy is liable to influence the undertaking’s competitive behaviour and market dynamics to the detriment of other economic actors, such as outbidding in acquisitions, aggressive pricing or bidding strategies and broader valuechain distortions. The new guidance also introduces a safeharbor for subsidies of an aggregate amount of less than €4 million over the past three years and compensation for natural disasters or exceptional occurrences.

More Clarity Regarding Public Procurement In the context of public procurement procedures, the Commission will focus on whether the foreign subsidy enabled the undertaking to submit an unduly advantageous offer. The Commission will assess whether it is “undue”, namely by comparing the submitted bid with other submitted bids and whether the advantage stems to an appreciable extent from a foreign subsidy, or whether it can plausibly be justified by other factors. While the national contracting authorities apply EU procurement rules, the Commission has exclusive competence to assess the existence of an undue advantage under the FSR.

Balancing Test The Guidelines provide further guidance on the balancing test, under which the Commission weighs the negative effects of a foreign subsidy against any potential positive effects. Such positive effects may include the development of the subsidised economic activity in the EU or broader benefits aligned with EU policy objectives, such as environmental protection, economic development in disadvantaged regions, energy security, innovation, competitiveness, resilience, or the Union’s economic security and defence policy. The guidance sets a rather high bar for a possible defense for distortive foreign subsidies, as the Commission will assess whether the distortion is unavoidable to achieve the claimed benefits.

Call-in Powers for Concentrations and Public Procurement Procedures The Guidelines recall that the Commission may exercise its callin power in respect of non-notifiable transactions or public procurement

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ThoughtLeaders4 Competition Magazine • ISSUE 12 procedures, particularly where it suspects that foreign subsidies were granted within the preceding three years. However, the Commission has now introduced a safeharbor where the foreign subsidies remain below EUR 4 million on an aggregated basis over the last three years, or relate to bids below EU procurement thresholds, or to subsidies granted to remedy damage caused by natural disasters or exceptional occurrences.

The revision aims not only at codifying the Commission’s practice over the past 20 years, but also considers whether the current EUMR framework should be amended to reflect significant market trends and geopolitical developments have led to transformational shifts in many markets —most notably digitalisation, globalisation, and decarbonisation— which have significantly transformed market dynamics and placed increasing strain on the existing EU merger control framework. The final merger guidelines are not expected to be published before late 2027.

Conference The next stage of the process will be a conference scheduled for 5 March 2026, bringing together experts and stakeholders to discuss key aspects of the review and the evolving challenges of EU merger control. At a later stage, the Commission is expected to publish a first draft of the revised merger control guidelines, which will be subject to further public consultation.

Review Process of the EU Merger Control Guidelines

Ongoing Review of the EU Merger Control Guidelines In May 2025, the European Commission launched a public consultation on possible reforms to its horizontal and non-horizontal merger control guidelines. This is the most significant revision of the EU Merger Regulation (EUMR) framework in the last two decades.

A general consultation was organised to address high-level questions on merger assessment under the EU Merger Regulation and the principles underpinning the revised guidelines, while an in-depth consultation focused on technical issues across seven key themes, such as digitalisation, innovation, efficiencies, sustainability, defence, and labour considerations.

Workshop In parallel, the Commission commissioned an economic study on the dynamic effects of mergers and organised technical stakeholder workshops on 4 December 2025 and 20 January 2026.

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ThoughtLeaders4 Competition Magazine • ISSUE 12

| Law |

AI PROMPTS NEW SCRUTINY AND OPPORTUNITY

IN COMPETITION INVESTIGATIONS Authored by: Ashley Brickles (Senior Managing Director) - FTI Consulting With hundreds of new startups launched each year and tens of billions of euros invested in development, the generative artificial intelligence landscape has exploded in Europe. This rapid growth has triggered legal and regulatory impacts on two distinct fronts: first, an uptick in regulatory scrutiny of potentially anticompetitive transactions, and in parallel, new procedural solutions for organisations facing investigation. This article will examine how the generative AI boom is inviting new questions and increased rigor among competition authorities and how organisations can leverage generative AI to streamline legal processes. Regulators now squarely recognise data as a competitive asset, and the use of AI for business activities such as pricing, data sharing and selfpreferencing represents an evolution in the way organisations may use data to their advantage. In some instances,

such uses may be considered anticompetitive. This holds true for joint ventures involving AI technology, where exclusivity agreements and preferential access to data or infrastructure could result in market dominance and competitor stifling. As a result, the European Commission and the Competition and Markets Authority have opened several cases for potential competition issues involving AI partnerships. Not only is AI technology emerging as a market disruptor, but it’s rapidly becoming a tool for agencies to identify potential issues and expedite their own analysis and review of information provided in response to internal document requests. For example, AI and web scraping tools can detect anti-competitive behaviour, and large language models can be leveraged to rapidly assess key facts within documents submissions. It’s thereby

becoming easier for authorities to flag issues during an investigation and to streamline analysis in future investigations involving the same sectors. Recently, agencies have expanded internal document requests to include AI prompt logs and artefacts, as this data may contain valuable insights into perceived market dynamics and behaviours. This expansion creates new preservation and downstream review and production considerations given the disparate ways in which data can be stored, accessed and linked in various large language models. In this complex and fast-moving landscape, organisations and external legal teams must stay on the front line with their data strategies, particularly if they are leveraging AI in their go to market activities and are therefore at a heightened risk of being targeted

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ThoughtLeaders4 Competition Magazine • ISSUE 12 in a competition investigation. Using generative AI tools to support document analysis and review can help to improve readiness and reduce the burden of responding to a data-heavy investigation. Particularly in Europe, where the procedural timelines are exceptionally short and data volumes are typically very high, generative AI can offer a meaningful, additive step to mitigate risk in a way that traditional review workflows simply cannot. To date, there hasn’t been explicit approval for the use of generative AI in this context, and case law for its use in investigations is limited. However, there has been an uptick in use cases for portions of the document discovery and review process, which can provide efficiency and cost savings while maintaining legal defensibility. The critical piece in maintaining defensibility is a wraparound of human experts to design prompts and provide quality assurance, so that results are validated and controlled for potential for omission and hallucinations. With the foundation of humans in the loop, there are several ways generative AI can support legal teams in reducing the time and cost burdens of large scale, time-pressured competition investigations. These include:

• Automating Legal Review. With expert oversight, generative AI can automate privilege and relevancy reviews and the creation of privilege and privacy logs, which are often required when withholding documents from a production. Legal teams need to work closely with data scientists and technology providers to refine AI prompts and validate results through iterative sampling. Thereafter, the output should undergo a thorough validation review to ensure defensibility of process. This can be accomplished via traditionally accepted processes such as predictive coding or human review.

• Enhancing Review of NonTraditional Data. Review of audio and video calls, foreign language and non-searchable documents often increases legal spend and extends review timelines. Generative AI can help expedite by generating searchable transcripts, high quality translations and key data extractions. This helps legal teams prioritise review, and where appropriate, automate the identification of relevant and privileged material.

• Expediting Advocacy Reviews. Generative AI can expedite advocacy review and the identification of helpful and unhelpful documents found within data sets turned over to regulatory agencies. This enables legal teams to proactively prepare responses to potential concerns and identify evidence that will bolster their position, whilst avoiding costly and time-consuming manual review.

• Improving Quality Control. While experts must be vigilant about validating the results produced by generative AI in document review workflows, generative AI capabilities can also support the execution of quality control checks. Samples of document sets reviewed by lawyers can be run through the models to detect anomalies or mistakes in document coding, providing an added layer of validation for consistency and accuracy. This is especially valuable when review teams are working around the clock to meet statutory deadlines. AI and other analytic-based technologies have been an accepted component of review strategies for more than a decade. Generative AI is the next advancement in automating the most burdensome and time-consuming aspects of legal discovery and review. The fact remains that for its use to be defensible, legal teams and data experts need to partner together to ensure the development, refinement and validation process is robust, avoids known risks and is ultimately cost effective and fit for the task at hand.

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ThoughtLeaders4 Competition Magazine • ISSUE 12

THE CLASS MEMBERS AND THE MERITS

SUPREME COURT CLARIFIES THE CHOICE BETWEEN OPT-OUT AND OPT-IN PROCEEDINGS Authored by: Julian Stait (Partner), Mark Padley (Senior Associate) & Georgia Kinsella (Associate) - Milbank In a judgment handed down shortly before the end of 2025,1 the UK Supreme Court (“SC”) clarified the test for determining whether to certify collective proceedings on an opt-out or opt-in basis, and the extent of the discretion that the Competition Appeal Tribunal (“CAT”) has in that regard. This issue is of real significance: where an opt-out claim is certified, the class members will automatically be included in the claim, unless they specifically elect to opt-out;2 however, where a claim is certified on an opt-in basis, claimants will only become class members if they decide to sign-up to be part of the claim, most likely following a ‘book-building’ exercise by a claimant law firm. That decision will, therefore, affect the size of the class

and, consequently, the value of the overall claim which, in turn, will affect the viability of the claim for litigation funders, who bear the considerable costs of bringing collective proceedings. Where it is possible to pursue the claim on an opt-out basis, that will give the class representative very significant leverage over the defendants and will

“carry the risk that defendants may be driven to settle unmeritorious claims by their sheer size and the heavy costs of defending them”.3

Background In 2019, the proposed class representative (“PCR”), Mr. Evans,4 applied to bring opt-out collective proceedings seeking damages against various banks following on from the findings in two 2019 settlement decisions of the European Commission.5 Those decisions found ‘by object’ infringements of competition law that involved the exchange of commercially sensitive information between traders. Whilst the Commission concluded that there was a single and continuous infringement lasting a number of years, that was based on “occasional opportunistic coordinated behaviour relating to

1 Evans (Respondent) v Barclays Bank Plc and Others (Appellants) [2025] USKC 48 (the “SC Judgment”). 2 SC Judgment, §3. 3 id. 4 Mr. Phillip Evans v Barclays Bank PLC and Others (Case 1336/7/719). There was originally a competing PCR, Michael O’Higgins FX Class Representative Limited (Michael O’Higgins FX Class Representative Limited v Barclays Bank PLC and Others, Case 1329/7/7/19). However, Mr. Evans was the preferred PCR to move forward with the proceedings. 5 Case AT.40135 FOREX (Three Way Banana Split) and Case AT.40135 FOREX (Essex Express).

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ThoughtLeaders4 Competition Magazine • ISSUE 12 trading activities”6 the commercial value of which was said to last for a period of “minutes or at most hours”7 which the Commission inferred may have enabled the participating traders to quote wider bid-ask spreads for specific currency pairs for certain trade sizes to particular clients during these periods. However, the claim sought damages on behalf of two wider groups of persons who were not parties to the relevant transactions by the participating traders, namely: (a) persons who entered into spot currency transactions with one or more of the defendants during the relevant period, on the assumption that anyone who did so was quoted a wider bid-ask spread than would have been the case in the absence of the infringing conduct, and lost money as a result (“Class A”); and (b) persons who entered into spot currency transactions with other banks (i.e., not the defendants), but who were alleged to have suffered loss due to the “umbrella effect” of the infringement (“Class B”).8 Because the Commission found that the infringements were ‘by object’, it did not make any assessment of the effect of the infringing conduct on competition in the relevant market, and so it was necessary for the class representative to prove that the infringing conduct caused loss to those in Class A and Class B. In March 2022, the CAT held that the proceedings should only be certified on an opt-in basis.9 In doing so, it had regard primarily to the two factors listed in the relevant CAT Rule 79(3): the strength of the claim and the practicability of opt-in proceedings. The CAT gave close consideration to the strength of the claim, focusing on the absence of a clear explanation as to how transactions that were not the subject of the unlawful information exchanges were affected. It noted that the claim was “so weak that [it is] liable to be struck out” and that weakness “amounts to a powerful reason against certifying on an opt-out basis”.10 As

regards the practicability of bringing proceeding on an opt-in basis, the CAT said that should be judged objectively from the standpoint of the class which – in this case – was held to be primarily “sophisticated potential litigants, capable of looking after themselves”.11 Accordingly, the CAT considered there was no reason why it would not be practical for the proposed class to join on an opt-in basis and where they choose not to participate,

“access to justice should not be forced upon an apparently unwilling class”.12 Following an appeal by Mr. Evans, in July 2023, the Court of Appeal (“CA”) decided to set aside the CAT’s decision on this point.13 The CA held that the CAT was wrong to accord its view of the merits “decisive weight in the scales against opt-out”.14 The CA further held that, where proceedings would not be brought, save on an opt-out basis, this constitutes “a powerful factor in favour of a claim being certified as opt-out”.15 In reaching its decision the CA also relied on a later ordinary decision of the Commission, which was not available at the time the CAT gave judgment (known as “Sterling Lads”).16 The CA held that this decision was admissible and relevant, including because it concerned essentially identical facts and supported the PCR’s submission that its causation case was not merely theoretical.17

The SC Decision The SC decided four issues in the appeal:

Issue 1: The Relevance of the Strength of the Claims to the Opt-in/Opt-out Issue: The SC held that the CA had no basis for “interfering” with the CAT’s assessment of the strength of the claim and the weight that was given to that assessment,18 stating that “it was neither illogical or unfair” to take into account the weakness of Mr. Evans’ claim and it was right to treat it as “a powerful reason” against opt-out proceedings.19 If a claim is judged to be weak, then it follows that affording the claimants the advantages of optout proceedings would mean that “the claimants would be given assistance to extract value from unmeritorious claims against defendants”, contrary to the principles of fairness and proportionality set out in CAT Rules 4(1) and (2).20 Moreover, CAT Rule 79(3)(a) would not have “singled out” strength as a factor if the legislature had intended this to be a neutral consideration in the choice between opt-in and opt-out proceedings.21

Issue 2: Did the Tribunal err in its Treatment of Practicability? As regards CAT Rule 79(3)(b), the SC noted that, “if it is practicable for claimants to bring opt-in proceedings, it is unlikely to be proportionate to confer upon them the additional advantages associated with the opt-out procedure and unlikely to be reasonable to expect the defendants to have to face the additional commercial pressures to settle the claims regardless of their true merit which that would involve”.22 The SC agreed with the CAT that an objective assessment is required, which should not depend on evidence

6 SC Judgment, §16. 7 SC Judgment, §16 & §50. 8 SC Judgment, §§48-51. 9 Mr. Phillip Evans and Michael O’Higgins FX Class Representative Limited v Barclays Bank Plc and Others [2022] CAT 16 (the “CAT Judgment”). 10 CAT Judgment, §375 (emphasis as in original). However, the CAT did not strike out the claim, and as a matter of procedural fairness, granted Mr. Evans an opportunity to submit a revised application for certification of the proceedings on an opt-in basis within three months of the date of its judgment. 11 CAT Judgment, §§380-381. 12 CAT Judgment, §385(2). 13 Evans v Barclays Bank Plc & Others [2023] EWCA Civ 876 (the “CA Judgment”). 14 CA Judgment, §134. 15 CA Judgment, §123. 16 On 5 July 2022 the Commission published two decisions: Commission ordinary decision Case AT.40135-FOREX (Sterling Lads) C(2021) 8612 final, addressed to Credit Suisse, and a settlement decision in Case AT.40135-FOREX (Sterling Lads) C(2021) 8613 final, addressed to Barclays, RBS, UBS and HSBC. 17 CA Judgment, §101-108. 18 SC Judgment, §77. 19 SC Judgment, §§87, 96, and 102. 20 SC Judgment, §§91-94. 21 SC Judgment, §§99, 102, and 104. 22 SC Judgment, §112. The SC also noted that, in some cases, the claimants “may be large commercial organisations, well capable of looking after their own interests, and the

ThoughtLeaders4 Competition Magazine • ISSUE 12 regarding the state of mind of claimants on whether to opt-in (or the legal advice they received regarding the claim).23 The SC also pointed out that it was not for the CA to undertake its own assessment of these issues and substitute its view for that of the Tribunal “Rather, it should have … refrained from interfering with the conclusions of the specialist tribunal which, under the collective proceedings regime, has been tasked with making the relevant evaluation, unless there was an error of law in the Tribunal’s approach”.24

This case also highlights that, even a finding by a competition authority of a ‘by object’ infringement, on a single and continuous basis, can create significant challenges for potential claimants to establish that they suffered any loss as a result.

Issue 3: Other Factors Relied On by the CA: The SC agreed with the defendants that the CA was wrong in suggesting that ‘facilitating the vindication of rights’ and ‘deterring future wrongdoers’ are factors which point strongly in favour of opt-out proceedings. Instead, those factors need to be “counterbalanced by the need to safeguard the rights of defendants” from unmeritorious or inflated claims.25

Issue 4: Did the CA err in its Use of the Sterling Lads Ordinary Decision?26 The SC held that the Sterling Lads decision was inadmissible and irrelevant because the decision: (i) was not part of the material available to the CAT, given it was issued after the CAT Judgment; (ii) was addressed to a third party (Credit Suisse); and (iii) concerned different infringements to those on which the claim was based.27 The SC was particularly critical of the CA’s finding that the rule in Hollington v Hewthorn should not apply in the CAT – noting that this rule upholds the principle of fairness and that it would be “fundamentally unfair”28 to admit the Sterling Lads decision, particularly where the parties were not involved in these proceedings.

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Implications for Future Cases In its judgment, the SC emphasised that the UK class action regime

“was not intended simply to provide a stick with which anyone who claims, however implausibly, to have suffered loss can beat infringing undertakings into paying them substantial damages”.29 The merits of the claim should be carefully assessed at the certification stage in order to decide whether it should be certified on an opt-in or opt-out basis; with weaker claims less likely to be certified on an opt-out basis. And decisions of the CAT in this regard should be treated by the CA with deference, absent an error of law. This seems to suggest an effort by the SC to rebalance the UK’s competition class action regime, which was considered by many to have become particularly claimant-friendly at the certification stage.

Further, where opt-in proceedings are a viable option, PCRs may have an uphill battle convincing the CAT that opt-out proceedings are suitable. PCRs may, in those circumstances, choose to bring a claim on an opt-in basis, however, such claims are inherently more time-consuming to put together, often with lengthy book-building phases being necessary, and usually result in lower aggregate claim values. That will reduce a claim’s attractiveness to litigation funders and claimant firms. Alternatively, where a class is made up of both large and small claimants, PCRs may consider bifurcating the class into an opt-out claim made up of the smaller claimants and an opt-in class comprising the larger claimants. Finally, the SC’s confirmation that past court and regulatory decisions are not admissible as evidence of the facts found could have potentially wide-ranging implications. Claimants may struggle to rely on other judicial and regulatory decisions at trial, save where their claim strictly follows-on from those decisions. This may also have an impact on the appeal of existing first instance decisions that relied on prior regulatory findings.

sums involved may be large enough to make it financially viable to contemplate bringing proceedings to seek recovery […] In such circumstances it may not be appropriate for collective proceedings to be brought at all; and if collective proceedings are considered appropriate, it is likely to be only on an opt-in basis.” (See §§117 and 124.)

23 SC Judgment, §119. 24 SC Judgment, §133. 25 SC Judgment, §138. 26 Unlike the other banks, Credit Suisse did not cooperate with the Commission’s investigation and did not agree to settle. Therefore, the Commission issued an ordinary decision addressed solely to Credit Suisse, with more detailed findings following an investigation. 27 SC Judgment, §142. The SC clarified that a decision of the Commission containing findings of infringement against a third party is not admissible. 28 SC Judgment, §153. 29 SC Judgment, §141.

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ThoughtLeaders4 is dedicated to creating opportunities for emerging ThoughtLeaders4 are serious about providingmeaningful opportunities to up-and-coming practitioners practitioners inWe Competition law.opportunities We firmly believe that theofnext generation specialising inspecialising Competition. strongly believe that the next practitioners should ThoughtLeaders4 are serious about providing to generation up-and-coming practitioners should be actively writing, speaking, and participating in events to expand their networks be writing, speaking at and We attending in order to build their network further their specialising in Competition. stronglyevents believe that the next generation of and practitioners should and accelerate their professional growth. careers. be writing, speaking at and attending events in order to build their network and further their careers. With this commitment in mind, we were delighted to present the Competition Next With this in mind, we are proud to present the inaugural Competition Next Gen Future Gen Future Thought Leaders Essay Competition. Judged by a distinguished and highly experienced panel of the competition highlighted Thought Leaders Essay Competition. Assessed by an illustriously experienced, and With this in mind, we aresenior proudpractitioners, to present the inaugural Competition Nextoutstanding Gensenior Future emerging talent from across the Competition community. broad-ranging panel of practitioners this is your chance to stick your head above the and parapet Thought Leaders Essay Competition. Assessed by an illustriously experienced, senior and mark yourself as the one-to-watch. thechance opportunity to your attend andabove discussthe your essay broad-ranging panel of practitioners thisWith is your to stick head parapet We extend our congratulations to everyone who participated, and especially to our at our The Competition Next Gen we look forward to your submissions and to and mark yourself as theclarity, one-to-watch. With2026, the opportunity to attend and discuss your essay winners, whose insight, andSummit originality truly distinguished them. They will have the welcoming you to the Competition community. opportunity to attend and discuss their essays atwe Thelook Competition Nextsubmissions Gen Summit at our The Competition Next Gen Summit 2026, forward to your and to 2026, firmly you establishing themselvescommunity. as rising voices to watch in the years ahead. welcoming to the Competition

ng opportunities to up-and-coming practitioners

elieve that the next generation of practitioners should

nts in order to build their network and further their

THE BRIEF THE BRIEF

The CMA has proposed in its response to the DBT's call for evidence in relation to its review of the opt-out in collective actions regime relating to the to DBT'stwo callproposals for evidence The CMA has proposed its response to the DBT’s in relation relationship public and private its review of between the opt-out collective actionsenforcement; regime two proposals relating relating to to the the

the inaugural Competition Next Gen Future

relationship between public andexperienced, private enforcement: enforcement; senior and essed by an illustriously Full immunity from damages for Type A leniency applicants in cartel cases in order to protect its leniency regime

• Full Full immunity immunity from from damages damages for for Type Type AA leniency leniencyapplicants applicants in in cartel cartel cases cases in in your chance to stick your head above the parapet Empowering the CMA to issue directions for redress so as to avoid the need for order order to to protect protect its its leniency leniency regime regime follow-on damages claims Empowering the CMA CMA to issue issue directions directions for for redress redress so so as as to to avoid avoidthe theneed needfor for • Empowering the to follow-on damages damages claims claims follow-on If enacted how do you think these proposals would change the role of public enforcement and do you think the impact would be onthe private claims? enacted how do you these proposals would change role If enacted, how dowhat you think think these proposals would change the role of of public public

ith the opportunity to attend and discuss your essay

it 2026, we look forward to your submissions and to

enforcement and what do you think the impact would be on private claims?

munity. In the run-up to The Competition Next Gen Summit 2026 conference on 3-4 March in London, we invite submissions from next practitioners on conference this topical debate. In therun-up run-up toThe The Competition Nextgen Gen Summit 2026 2026 conference on 3-4 3-4 March March inin In the to Competition Next Gen Summit on London, we invite invitesubmissions submissions from next gen practitioners ontopical this topical debate. London, we from next gen practitioners on this debate.

We encourage you to set out your personal views and thoughts on the current law and its potential future direction draw on yourviews own and orand your colleagues’ experiences. We you to to set setand outto your personal views thoughts the current and We encourage encourage you out your personal thoughts onon the current lawlaw and its

its potential future direction to draw on your or colleagues’ your colleagues’ experiences. potential future direction andand to draw on your own own or your experiences.

We also invite you to be creative, well-researched, opinionated, and take a position on this We invite youto tobe becreative, creative, well-researched, opinionated, a position timely issue, affecting the next generation of divorce practitioners. We also also invite you well-researched, opinionated, and and take take a position on this

on this timely issue, affecting the next generation of Competition practitioners. timely issue, affecting the next generation of divorce practitioners.

JUDGING PANEL NICOLE KAR

ELAINE WHITEFORD

PAUL WEISS

WILLKIE FARR & GALLAGHER

PARTNER

Nicole Kar is global co-chair of the Antitrust Practice. She advises on global merger investigations from an antitrust and foreign investment standpoint and has led over 40 significant merger reviews before the UK and European authorities; as well as advising on cartel, abuse of dominance and consumer law investigations and consequential litigation, particularly in the UK’s Competition Appeal Tribunal; compliance issues; and self-reporting to financial and other regulators.

JOHN MESSENT COUNSEL

CLEARY GOTTLIEB John Messent’s practice covers all aspects of UK and EU competition law, as well as rules on national security and investment screening. He has represented clients before the European Commission, the Competition and Markets Authority, and UK sectoral regulators, as well as before the EU and UK Courts. John was seconded in 2013 to the Policy department of the Office of Fair Trading, working on guidance documents to be published by the new Competition and Markets Authority (including on mergers, Competition Act investigations, and criminal cartel prosecutions). He became counsel in 2024.

STEPHEN WISKING PARTNER

HERBERT SMITH FREEHILLS Stephen has over 20 years' experience and has been involved in a significant number of landmark competition and regulatory cases at EU and UK level. He specialises in all aspects of EU and UK competition law, including merger control, cartels and abuse of dominance cases, market investigations, competition disputes and strategic advice. Stephen advises clients across a broad range of sectors including financial services, media (particularly broadcasting), telecoms, energy, pharmaceuticals and professional services.

PARTNER. ANTITRUST & COMPETITION

Elaine Whiteford has over 20 years' experience of contentious EU, Competition and Regulatory work, specialising in follow-on damages litigation, challenges to regulatory decisions, cartel investigations and threatened disputes. Elaine also has extensive experience in relation to regulatory investigations conducted by the European Commission and other competition regulators.

ANDREW LEITCH PARTNER HOGAN LOVELLS Andrew has significant experience in competition litigation, having acted for both claimants and defendants in disputes arising out of price fixing cartels, in addition to advising on litigation concerning abuse of dominant positions in marketplaces. Andrew has experience of litigating disputes in various courts in the U.K., including the High Court of Justice, the Competition Appeal Tribunal and the Court of Appeal. He has advised clients in a range of regulated and non-regulated industry sectors, including industrial manufacturers, financial institutions and technology companies.

ThoughtLeaders4 Competition Supplement • ISSUE 12

TL4 Essay Competition

CMA PROPOSALS

A SHIFT FROM PRIVATE CLAIMS TO PUBLIC ENFORCEMENT? Authored by: Rachel Malloch (Managing Associate - Practice Development) - Linklaters The CMA has proposed in its response to the DBT’s call for evidence in relation to its review of the opt-out collective actions regime two proposals relating to the relationship between public and private enforcement: (i) full immunity from damages for Type A leniency applicants in cartel cases in order to protect its leniency regime, and (ii) empowering the CMA to issue directions for redress so as to avoid the need for follow-on damages claims. If enacted, how do you think these proposals would change the role of public enforcement and what do you think the impact would be on private claims?

introduction of the regime, the DBT considers the time is right to review its operation and impact. The DBT has tasked itself with assessing whether the regime strikes the right balance between delivering justice for consumers on the one hand and protecting businesses from unmeritorious claims on the other. The call for evidence seeks views on (among other things) the circumstances in which it might be appropriate to protect businesses from liability, as well as possible alternative routes to consumer redress. In responding to those questions, the CMA has put forward two key proposals:2

Introduction

• Providing full immunity from damages for Type A leniency applicants in cartel cases in order to protect its leniency regime; and

Before considering how these proposals could impact public and private enforcement, there are two prior questions to answer: (i) what is the role of public enforcement? and (ii) how does it relate to private enforcement?

• E mpowering the CMA to issue directions for redress so as to avoid the need for follow-on damages claims.

A helpful starting point to understanding the CMA’s enforcement role is to look at its primary statutory duty. Under section

On 6 August 2025, the Department for Business and Trade (DBT) issued a call for evidence on the operation of the UK’s opt-out competition collective actions regime.1 A decade on from the

1 2

In this essay, I examine how each of the CMA’s proposals, if enacted, could (i) change the role of public enforcement, and (ii) impact private claims.

What is the Role of Public Enforcement? And What is the Relationship between Private and Public Enforcement?

https://www.gov.uk/government/calls-for-evidence/opt-out-collective-actions-regime-review-call-for-evidence CMA response to DBT call for evidence on the opt-out collective actions regime - GOV.UK

ThoughtLeaders4 Competition Supplement • ISSUE 12 25 of the Enterprise and Regulatory Reform Act 2013 the CMA has a duty to promote competition, both within and outside the UK, for the benefit of consumers.

Any rebalancing of CMA enforcement towards restriction of competition cases and away from abuse of dominance cases may also be reinforced by the fact that digital markets regime (which regulates tech firms with “strategic market status”) is now operational.

Against that overarching duty, in my view, the CMA’s enforcement activity pursues three key aims: 1. To hold companies that infringe competition law to account; 2. To deter anticompetitive conduct including by firms that are not the subject of investigations; and 3. To protect consumers, principally by protecting the process of competition. In contrast, private enforcement, as the DBT recognises, is primarily aimed at ensuring access to justice and consumer redress. Private enforcement, and specifically collective action, recognises that consumers (and businesses) should have the right and means to seek corrective justice, including in circumstances where it would not be viable to pursue a claim on an individual basis. In consequence, private enforcement also has a complementary deterrent effect to public enforcement. This is both in respect of follow-on claims and standalone claims. Standalone claims can play an important role in facilitating a broader scope of enforcement in circumstances where the CMA has finite resources and must make decisions on its enforcement priorities. As the CMA notes:

“public and private enforcement are both important parts of the UK’s single overall competition law regime. When they work well together the effectiveness of the regime as a whole is maximised.” Against that backdrop, I turn next to how the CMA’s proposals could change the role of public enforcement and impact private claims. I consider each of the CMA’s proposals in turn below.

TL4 Essay Competition

Shielding First-In Applicants from Damages Effect on the Role of Public Enforcement This proposal is arguably not just aimed at “protecting” but at “reviving” the CMA’s leniency programme. The CMA, in common with many other jurisdictions, has seen a fall in leniency applications in recent years.3 It seems likely that the CMA views private litigation as a key cause of this decline. It notes in its response to the call for evidence that:

“private rights to obtain redress for cartel conduct risk becoming abstract if they frustrate the public enforcement process which identifies secret cartel conduct in the first place.”4 However, it is not at all certain that the CMA’s proposal would achieve its aim. There are multiple factors which may explain the stall in leniency applications, for example, in respect of global cartels, the absence of a one-stop-shop to secure leniency.5 If the proposal did however result in a resurgence of leniency applications, this could lead to a shift in the CMA’s enforcement focus in favour of cartel cases. This would be in contrast to recent years where it has also pursued a number of abuse of dominance cases, particularly against big tech.

A further point can be made that this proposal arguably puts “detection” at the core of public enforcement. The CMA may say that effective detection of cartels is a necessary pre-condition to achieving the key aims I outline further above. However, I think granting full immunity to Type A leniency applicants sits somewhat uncomfortably with those aims. If the CMA’s role is to hold infringing companies to account then it feels at odds with that to allow the CMA to grant immunity (at the extreme to the ring leader of a cartel) not only in respect of its own forum but in the separate but related forum of private litigation. While an argument can be made that effective leniency enhances the deterrent effect of public enforcement, it significantly undermines the deterrent effect of private litigation. And, finally, if protecting consumers is central to the CMA’s purpose, full immunity (without caveats)6 could deny consumers a right to corrective justice full stop.

Impact on Private Claims In practice, considering the make-up of class actions to date before the Competition Appeal Tribunal (CAT), then the impact of private claims may be relatively limited. It is worth highlighting three key statistics:7 1. The majority of cases have been brought on a standalone basis: approximately 71% of collective proceedings (45 out of 63) are standalone claims. 2. The majority of cases concern alleged abuse of dominance: approximately, 60% of collective proceedings (38 out of 63) have alleged an abuse of dominance. 3. Of the 24 restriction of competition claims, 9 are follow-on and 5 contain both follow-on and standalone elements.

3 See OECD (2023), OECD (2023), “The Future of Effective Leniency Programmes: Advancing Detection and Deterrence of Cartels”, OECD Competition Policy Roundtable Background Note, www.oecd.org/daf/competition/the-future-of-effective-leniency-programmes-2023.pdf, p8. 4 CMA response to DBT call for evidence, para 11. 5 Supra note 3, p25. 6 Note the CMA accepts that it may be appropriate to withdraw full immunity in certain circumstances eg where full compensation cannot be obtained from the other cartelists due to insolvency: CMA response to DBT call for evidence, para 15. 7 All statistics taken from Linklaters | Big CAT Watch (accessed 7 December 2025).

ThoughtLeaders4 Competition Supplement • ISSUE 12 In light of the above, in the shorter term we may expect the impact of this proposal on private claims to be limited given the current trend to standalone and abuse of dominance claims. However, if the proposal did result in a refocusing of public enforcement to cartel cases then this could in time impact private actions: with a larger pool of potential chapter I follow-on claims (but with one cartelist shielded from liability).

In light of the above, in my view, this proposal if implemented is simply the CMA continuing along a path it is already on and consistent with its overall purpose to protect consumers.

At a basic level, giving the CMA power to direct redress would involve the CMA taking on a greater consumer redress role than it has at present. However, in my view there is nothing in this proposal that is fundamentally at odds with its overarching statutory duty given the emphasis on securing consumer benefit. Empowering the CMA to mandate redress is not a huge pivot for two further reasons: First, the CMA already has the power to approve (and enforce) voluntary redress schemes under the Competition Act 1998 (CA98)8. While the voluntary redress scheme has never been used the fact remains that statute has already bestowed a consumer redress role on the CMA. Second, the CMA has already made use of its existing powers to secure redress through its acceptance of commitments. For example, the CMA recently accepted commitments to close its investigation into suspected anticompetitive information exchange by housebuilders.9 These included a commitment on the part of housebuilders to make a voluntary payment of £100m into the Government’s affordable homes programme. Perhaps more directly on point, earlier this year, the CMA’s investigation into suspected anticompetitive disparagement by Vifor in respect of competing high-dose IV iron products10 was also closed by commitments, including a commitment by Vifor to make a voluntary payment of £24m to the NHS as Vifor’s main customer for the product in question in the UK. 8 9 10 11 12

“directly impacted a large cohort of customers” and an appropriate level of redress “may be relatively clear and ascertainable”.11 If enacted, the task for the CMA will be to design a redress regime that delivers on its “4Ps” framework12 so that this proposal offers a meaningful alternative route to redress which complements the private collective action regime.

A Redress Regime with Teeth Effect on the Role of Public Enforcement

TL4 Essay Competition

Conclusion Impact on Private Claims If enacted, the proposal would create an alternative route to redress, potentially allowing individuals (or businesses) harmed by anticompetitive conduct to avoid what is undeniably costly and complex litigation. In principle, this may necessarily result in a reduction in private claims. However, in practice, the impact on private claims is again likely to be more limited. As noted above, the vast majority of private claims to date have been brought on a standalone basis. While many of these are “quasi follow-on” in the sense that they rely on eg findings in market studies and investigations (and as well as decisions and judgments from other jurisdictions) the CMA’s response is clear that this proposal would be limited to where it finds a CA98 infringement.

The outlined CMA proposals would undoubtedly impact the role of public enforcement and affect the balance between public and private enforcement. In respect of the proposal to provide full immunity to Type A leniency applicants, if successful, this may result in a rebalancing of the CMA enforcement towards cartels. It would put “detection” at the core of the CMA’s role but arguably this comes (to some extent) at the expense of aims which it shares with private enforcement to hold companies account, deter anticompetitive conduct and protect consumers. CMA powers to direct redress would further an existing redress role performed by the CMA. While it may impact on the volume of follow-on claims, an effective system of mandated redress could be an important complement to private actions.

Further, while in my view any proposal which seeks to provide quicker and less onerous redress should be welcomed, there remains a lot to “figure out” in respects of the circumstances in which it will be appropriate and the mechanics of how to administer such a regime. Most obviously, there may be significant difficulties in designing and administering a redress scheme where pass-on is in issue. However, the CMA is well aware of these sorts of issues. In its response, it is clear that the intention is for this to be a discretionary power for use in appropriate case: cases where the CMA can direct redress quickly and efficiently. For instance, cases where it may be appropriate would, according to the CMA, include where harm has

Section 49C, as amended by the Consumer Rights Act 2015. https://www.gov.uk/cma-cases/investigation-into-suspected-anti-competitive-conduct-by-housebuilders https://www.gov.uk/cma-cases/investigation-into-suspected-anti-competitive-conduct-by-vifor-pharma-in-relation-to-intravenous-iron-treatments CMA response to DBT call for evidence, para 22 These are pace, predictability, proportionality and process. See New CMA proposals to drive growth, investment and business confidence – Competition and Markets Authority

TL4 Essay Competition

ThoughtLeaders4 Competition Supplement • ISSUE 12

CMA PROPOSALS A SHIFT FROM PRIVATE CLAIMS TO PUBLIC ENFORCEMENT?

Authored by: Anna Stellardi (Assistant Director) - Competition and Markets Authority The CMA has proposed in its response to the DBT’s call for evidence in relation to its review of the opt-out collective actions regime two proposals relating to the relationship between public and private enforcement • Full immunity from damages for Type A leniency applicants in cartel cases in order to protect its leniency regime • Empowering the CMA to issue directions for redress so as to avoid the need for follow-on damages claims If enacted how do you think these proposals would change the role of public enforcement and what do you think the impact would be on private claims?

The CMA’s proposals are likely to have a positive impact on both public and private enforcement of competition law.

Immunity from Damages for Type A Leniency Applicants Cartels are generally conducted in secret, meaning that detection of cartel conduct is paramount to enforcing competition law.1 Competition authorities play a vital role in detecting cartels. On my review, c.90 cartel private actions2 have been issued in the Competition Appeal Tribunal (“CAT”) or High Court since the beginning of 2020.3 The vast majority are based on facts uncovered by virtue of a competition authority investigation or infringement decision.4 Only 25 are based on facts that have not been investigated by a competition authority. And where a

1 CMA, “Applications for leniency and no-action in cartel cases”, CMA210, 28 October 2025, foreword paragraph 4. 2 I.e. claims alleging breaches of s.2 of the Competition Act 1998 or Article 101 of the Treaty on the Functioning of the European Union in respect of horizontal agreements, decisions or concerted practices (excluding claims which also allege abuse of dominance). 3 Based on a review of Court records and trackers maintained by Practical Law: https://uk.practicallaw.thomsonreuters.com/Document/I33f1f111e8cd11e398db8b09b4f043e0/View/ FullText.html?transitionType=SearchItem&contextData=(sc.Search) (last accessed 8 December 2025). 4 Whereas the vast majority are “follow-on”, a handful are technically “standalone” but relate to facts uncovered by way of a competition authority investigation. 5 (Claim No. 1702/5/7/25) Lenzing AG and others v Westlake Vinnolit GmbH & Co. KG and others and (Claim No. 1523/7/7/22) BSV Claims Limited v Bittylicious Limited and others.

TL4 Essay Competition

ThoughtLeaders4 Competition Supplement • ISSUE 12 claim is issued in the absence of an investigation, it is “exceptionally difficult to prove”, as noted recently by Sir Peter Roth.6 Accordingly, detection of cartel conduct by competition authorities is – in a very real sense – a gateway to claiming compensation for loss and damage arising from cartels through the Courts. A key mechanism by which cartel infringements are detected is via leniency programmes, and in particular Type A leniency applicants (who are the first to apply for leniency before the CMA has started to investigate).7 The CMA’s leniency programme enables firms and individuals who have been involved in cartel conduct to come forward and cooperate with the CMA in return for immunity from, or a reduction in, financial penalties and other sanctions.8 In parallel, private damages actions play an important role in cartel enforcement, ensuring that cartelists are not able to profit from their infringements. However, there is a tension between these two competition enforcement mechanisms. Applying for leniency, and thereby inviting an infringement decision, could expose the cartelist to private damages actions.9 This risk is widely regarded as a disincentive to applying for leniency.10 Currently, the balance has been struck pursuant to Schedule 8A to the Competition Act 1998 (“CA98”), whereby immunity recipients receive certain protections in the context of private damages actions, but not immunity from them.11 However, there is evidence that more must be done to encourage leniency applications. The OECD reported a global decline in the volume of leniency applications in the period of 2015 to 2021.12 Whilst the decline was relatively

shallow in the UK,13 and numbers fluctuate year on year, the period 2023/2024 has once again seen an overall decline.14 The CMA’s proposal to shield Type A immunity applicants from private damages actions is therefore likely to (a) increase the detection of cartel conduct and thereby (b) increase the opportunity to bring a cartel private damages action in respect of such conduct. Arguments that the CMA’s proposal could fetter the ability to claim compensation from cartelists are overstated. Cartels by definition occur between more than one undertaking, and those undertakings are (save where otherwise legislated) jointly and severally liable for damages. Accordingly, a claimant may recover the entirety of the compensation due to it in relation to a cartel infringement from any one of the undertakings party to the infringement. It is therefore inherently unlikely that immunising one cartelist (the Type A leniency applicant) from private damages actions will prevent claimants from being compensated. This may occur if all cartelists other than the Type A leniency applicant have become insolvent. However, the CMA has proposed that immunity from damages should be subject to withdrawal by the Courts in cases where full compensation cannot be obtained from other undertakings involved in the infringement. In these circumstances, the CMA’s proposal is likely to strengthen competition enforcement across the board.

Power to Order Redress As the CMA itself has acknowledged, it may not always be appropriate for it to order redress in the CA98 context.15 This is unsurprising. • Notwithstanding the “broad axe” principle that is applied by the Courts when quantifying loss,16 this can be an extremely challenging and time-consuming exercise. Even “follow-on” claims – where the only issues in play are causation and quantum – frequently take numerous years to conclude at first instance, notwithstanding that liability is not in dispute.17 • Such difficulties are often exacerbated in competition cases due to issues of “pass-on” – where an increase in costs leads to an increase in price. Pass-on assessments regularly require extensive expert evidence in Court proceedings.18 Given the CMA’s finite resources and increasingly heavy workload (noting recent expansions to its powers under the Digital Markets, Competition and Consumers Act 2024), the CMA is unlikely to have the resource to engage in such time-consuming exercises.

6 Sir Peter Roth, “25th Annual Burrell Lecture: The Private Enforcement of Competition Law - Reflections upon its Development, Progress and Challenges”, Competition Law Association: 25th Annual Burrell Lecture, 18 November 2025. 7

OECD, “The Future of Effective Leniency Programmes: Advancing Detection and Deterrence of Cartels, OECD Competition Policy Roundtable Background Note”, 2023, page 10.

See footnote 2, foreword paragraph 3.

9 Indeed, there has been a stark rise in the number of private damages actions since the Consumers Act 2015 came into force: Professor Barry Rodger, “Private enforcement in the UK: effective redress for consumers?”, Oxford University Press, 6 May 2021, pages 5-6. 10 For example, see: Roberto Alimonti, Sophie Kümmel and Thomas Nau, “The interplay between leniency programmes and private enforcement: the economist perspective on recent policy proposals”, Competition Law Journal, Volume 21, Issue 4, pages 170-179, 28 April 2022: “The emerging consensus seems to be that follow-on damages actions are deterring cartelists from applying for leniency”. 11

See ss.4, 14 to 16, 28(b) and 32(2) of Schedule 8A CA98.

OECD, “The Future of Effective Leniency Programmes: Advancing Detection and Deterrence of Cartels, OECD Competition Policy Roundtable Background Note”, 2023.

13 Norton Rose Fullbright, “Antitrust damages risk and leniency”, 2023: https://www.nortonrosefulbright.com/en-gb/knowledge/publications/0e011773/antitrust-damages-risk-andleniency (last accessed 8 December 2025). 14

OECD, “A Decade of OECD Competition Trends, Data and Insights”, 2025, figure 4.1, page 32.

CMA, “Opt-out collective actions regime review: call for evidence, response from the Competition and Markets Authority”, paragraph 21.

16 Daniel Beard KC, “Quantification of damages in competition law: a brief paper for the purposes of discussion 4 May 2023”, 2023: https://www.catribunal.org.uk/sites/cat/ files/2023-09/Quantification%20of%20Damages%20%28Monckton-Beard%20KC%29.pdf (last accessed 8 December 2025). 17 For example, (Claim No. HC-2015-000268) BritNed Development Ltd v ABB AB and another was issued in 2015 and trial judgment was handed down in 2018 ([2018] EWHC 2616 (Ch)), and (Claim No. 1284/5/7/18) Royal Mail Group Limited v DAF Trucks Limited and others was issued in 2018 and trial judgment was handed down in 2023 ([2023] CAT 6). 18 See, for example, the CAT’s judgment in (Claim No. 1284/5/7/18) Royal Mail Group Limited v DAF Trucks Limited and others [2023] CAT 6, paragraph 231: “There were some 48 experts’ reports filed in the case running to many thousands of pages […] that sort of scale may be justifiable in relation to the core issues of the Overcharge and Supply Pass-on […].”

ThoughtLeaders4 Competition Supplement • ISSUE 12 Instead, the CMA will likely only order redress where the victims of the infringement and the level of overcharge are readily identifiable. Such cases may include, for example, price fixing cases and retail price maintenance cases where the overcharge is self-evident and, potentially, excessive pricing cases where, depending on the methodology used, the CMA may identify a proxy for the counterfactual price. There are only a handful of such cases.19 The likely impact of this on private actions can be split into two categories:

a. Low Quantum Cases The collective actions regime was introduced to facilitate redress for competition infringements on a collective basis in circumstances where bringing individual claims would be too expensive or cumbersome.20 Notwithstanding this, the reality is that collective actions are extremely expensive,21 meaning that litigation funding is generally viewed as a necessary precursor to issuing a claim.22 Litigation funders are incentivised to fund claims if they consider that the claim has good merits and – crucially – that the damages are so large they will recover several multiples of their investment. In these circumstances, it is simply not possible for low value claims, no matter how compelling, to be issued using the collective actions procedure.23 The CMA, conversely, prioritises its CA98 investigations on a different basis. Amongst other things, it considers its strategy and priorities and the likely positive impact of taking action.24 This enables the CMA to launch CA98 investigations in respect of potential infringements which would not be eligible – from a funding perspective – for collective proceedings. Ordering redress in such cases would open a new route to compensation.

TL4 Essay Competition

b. High Quantum Cases Conversely, infringements which cause higher or more widespread financial harm are likely candidates for private damages actions. Ordering redress in such cases may step on the toes of private enforcement. Most obviously, those benefitting from a redress scheme should be precluded from recovering the same compensation through the Courts. This could be achieved by requiring beneficiaries to waive their rights in this regard – as is already envisaged pursuant to the CMA’s voluntary redress regime.25 Less obviously, CMA redress schemes may lead to under compensation in complex cases. Noting the CMA’s resource constraints, any redress scheme would likely focus on the direct harm caused by the infringement. It is inherently unlikely that the CMA will turn its mind to more remote forms of compensation, such as umbrella damages. The question is whether in these circumstances it would still be worthwhile to issue a smaller claim for the remaining and more remote forms of loss flowing from the infringement. The answer may well be no, especially where claims require litigation funding to get off the ground. This risk must however be viewed in context. As noted above, the CMA is unlikely to order redress in most cases. Where it does so, this will likely create efficiencies as regards the Courts’ time,26 the costs of obtaining redress (i.e. a CMA-funded scheme instead of litigation, which is costly, lengthy and ultimately uncertain), and the deterrent effect of competition enforcement (requiring cartelists to give compensation more quickly). Viewed in the round, the proposal is likely to have a net-positive, albeit marginal, impact on competition enforcement.

19 Since 2020, the best examples are: Supply of Rangers FC-branded clothing (Case 50930), Privately funded ophthalmology services (Case 50782-1), and Supply of liothyronine tablets (Case 50395). 20

Department for Business, Innovation and Skills, “Private actions in competition law: a consultation on options for reform – government response”, 2013.

21 See Department for Business and Trade, “Opt-out collective actions regime review: call for evidence”, 6 August 2025: “the order of magnitude [of legal fees for collective actions as a whole] can be estimated to be in the region of the hundreds of millions of pounds”. 22

Civil Justice Council, “Review of litigation funding, final report”, 2 June 2025, paragraphs 6.48-6.49.

23 Indeed, out of the claims issued since 2015 whose quantum is publicly known, it would appear that none claim less than £30m, with the vast majority claiming in the hundreds of millions or billions: https://www.hsfkramer.com/insights/2025-04/certification-tracker-of-uk-competition-class-actions (last accessed 8 December 2025). 24

CMA, “Prioritisation principles”, CMA188, 30 October 2023.

CMA, “Guidance on the Approval Of Voluntary Redress Schemes for Infringements of Competition Law”, CMA40, 14 August 2015, paragraph 2.39.

26 Sir Marcus Smith, “Remarks on Private Enforcement of Competition Law”, speech at Informa Connect, 7 February 2023: the CAT has been “inundated with private claims of all shapes and sizes”.

TL4 Essay Competition

ThoughtLeaders4 Competition Supplement • ISSUE 12

COMMENTS ON THE CMA’S PROPOSAL ON REVIEW OF THE OPT-OUT COLLECTIVE ACTIONS REGIME

AN ECONOMIST’S VIEW Authored by: Hamid Aghadadashli, Gianluca Strada & Roberto Venturini (Economists) - Compass Lexecon

Introduction he CMA has advanced two bold T proposals in its response to the Department of Business and Trade’s (‘DBT’s’) review of the opt-out collective actions regime.1 The CMA suggests granting full immunity from damages for Type A leniency applicants in cartel cases,2 alongside new powers to issue directions for redress that may reduce scope for follow-on damages claims. This new approach to competition policy hinges solidly on public enforcement. This note explores how such reforms could alter firms’ incentives when deciding whether to enter into cartel agreements, and assesses whether recalibrating the interface between public and private enforcement is feasible in

a context where companies operate in a globalised economy characterised by differing regulatory regimes.

Full Immunity from Damages for Type A Leniency Applicants Empirical evidence shows that leniency programmes sharply increase cartel detection rates.3 Leniency also complements the investigatory efforts of competition authorities, saving on the time and resources required for the investigation. However, it’s important to consider not only the desired positive effects, but also undesired negative effects. These can emerge from a careful assessment of how the proposal influences the economic incentives of firms that enter anticompetitive agreements.

1 CMA response to DBT call for evidence on the opt-out collective actions regime, Published 21 October 2025, https://www.gov.uk/government/publications/cma-response-to-dbt-callfor-evidence-on-the-opt-out-collective-actions-regime (‘CMA Response’). 2 A Type A applicant is the first company to apply for leniency before the CMA has started to investigate. 3 Ormosi, P.L. (2014), A Tip of The Iceberg? The Probability of Catching Cartels, Journal of Applied Econometrics, Volume 29, Issue 4, Pages 549-566; Joan-Ramon Borrell, Carmen

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Perverse Economic Incentives Leniency has proved to bring significant positive effects in terms of discovering cartels and boosting enforcement. While the positive effects seem to have been more than offsetting the negative effects so far, it is not guaranteed that making leniency more stringent will be, on balance, desirable. A too generous leniency regime may turn into an attractive lottery for certain firms, particularly those who might be able to reap the positive effects of anticompetitive practices while at the same time benefit from complete immunity.4 So, while a boost of the current regime would make certain cartels collapse, new ones might sprout because of the same policy. The net effect will depend on the interplay of complex incentives that are difficult to observe prior to implement a new regulation. Furthermore, leniency programmes also influence how cartels form and who participates in them. Large and small firms have different incentives in terms of defection. If leniency is bolstered, cartels will organize in such a way as to lower defection risks (for instance, new cartels will generally be formed between smaller firms). These cartels might be less effective at raising prices but will be more entrenched.5 Finally, for private enforcement to be an effective key pillar of deterrence,6 as well as a complement to private enforcement,7,8 it must provide economically viable incentives to sue.9 By granting full immunity to the Type A leniency applicant, the CMA proposal will likely prevent a significant fraction of affected customers from claiming. This would reduce the primary incentive to bring an action for damages, especially

TL4 Essay Competition

in agreements where the customers of the Type A leniency applicant represent a significant share of all the customers affected, and potentially compromise the economic viability of the system in its entirety. From an economic perspective, due to the incentives it creates for firms, it is unclear whether the CMA’s proposal would materially increase detection rates of anticompetitive agreements. Moreover, it might undermining the viability of private enforcement and thus reduce deterrence overall.

Design Conundrum A separate design issue is the potential for creating heterogeneous rules for leniency and private damages across jurisdictions.10 Firms concerned by antitrust issues often operate transnationally from the UK perspective.11 If the UK were to adopt the CMA’s proposal, firms will still need to consider their exposure to claims brought for the same infringement in different jurisdictions. his issue is particularly salient given T the “forum shopping” that characterises follow-on litigation.12 But even when consumers have alternative ways to obtain redress, not all of them might be able to bring claims in other jurisdictions, particularly in countries where collective redress solutions are not as well developed as in the UK. e consider that, also from a design W perspective, the CMA’s proposal can bring risks for the economic viability of private actions. Redress mechanisms available in other jurisdictions may be an imperfect substitute, particularly for less sophisticated claimants.

Empowering the CMA to Issue Directions for Redress The CMA’s proposal takes inspiration from the powers granted to them in the Digital Markets, Competition and Consumers Act 2024 (‘DMCCA’) and extend them, whenever they consider it appropriate or proportional to Competition Act 1998 (‘CA98’) matters.13 s the CMA partly recognises in its A response,14 quantifying harm from CA98 infringements can be quite complex. The CMA correctly recognises the issue of estimating pass-on to indirect consumers.15 But there are other issues which are not mentioned, such as heterogeneity of harm amongst consumers: the very same conduct can lead to differences in harm depending on the characteristics of the customers involved or the market circumstances.16

García, Juan Luis Jiménez, José Manuel Ordóñez-de-Haro, Short and Long Run Effects of Leniency Programs on Cartel Stability and Prosecution, Journal of Competition Law & Economics, Volume 20, Issue 3, September 2024, Pages 181–205. 4 Harrington Jr, J.E. (2008). Optimal Corporate Leniency Programs. The Journal of Industrial Economics, 56(2), pp.215–246; Harrington Jr, J.E. and Chang, M.-H. (2009). Modeling the Birth and Death of Cartels with an Application to Evaluating Competition Policy. Journal of the European Economic Association, 7(6), pp.1400–1435. 5

Bos, I., & Harrington, J. E. Jr. (2015). Competition Policy and Cartel Size. International Economic Review, 56(1), 133–157

6 Beyond deterrence in a static sense, there is also a broader question about whether weakening private enforcement might adversely affect the dynamic allocation of resources in the economy. 7

Lande, R. H., & Davis, J. P. (2011). Comparative deterrence from private enforcement and criminal enforcement of the US antitrust laws. BYu L. Rev., 315.

8 Hüschelrath and Peyer (2013) show that the optimal mix of enforcement tools depends on the type of violation and on the source of key evidence. See Hüschelrath, K., & Peyer, S. (2013). Public and Private Enforcement of Competition Law: A Differentiated Approach. European Competition Journal, 9(1), 7–31. 9 European Commission (2013). Proposal for a directive of the European Parliament and of the Council on certain rules governing actions for damages under national law for infringements of the competition law provisions of the Member States and of the European Union. (COM (2013) 404 final). Strasbourg: European Commission, pp.1–41. 10

OECD (2023). The Future of Effective Leniency Programmes: Advancing Detection and Deterrence of Cartels. OECD Roundtables on Competition Policy Papers, 299. p. 25.

See, e.g. https://www.clearygottlieb.com/-/media/files/ihl-briefing-uk-competition.pdf

12 The diversion of Italian claimants to Spanish courts in the Italian corrugated cardboard cartel is a neat example of such risks. See e.g. https://cincodias.elpais.com/legal/2023/11/29/ juridico/1701276004_862361.html 13

CMA Response, paragraphs 17-22.

CMA Response, paragraph 21.

Ibid.

16 For example, in the Copper Plumbing Tubes case, the European Commission found evidence that the cartel was especially effective in particular geographies and for particular product classes. Commission Decision in Case COMP/E-1/38.069 – Copper Plumbing Tubes, paragraph 634. Examples of cases where the Commission found that the effectiveness of the cartel varied over time are: Commission Decision in Case COMP/E-1/38.069 – Copper Plumbing Tubes, paragraph 664; Commission Decision in Case

ThoughtLeaders4 Competition Supplement • ISSUE 12 The key question is whether, and how, a centralised approach would account for these nuances in practice. irst, we consider that – for the CMA F to effectively replicate what currently happens in follow-on proceedings – the scope of the task would be immense. The CMA would need to: quantify effects (establishing the level of consumer overcharges, volume effects and pass-on), determine the value of commerce across all deals affected by the infringement, and analyse interest and tax effects. This might require a data disclosure process from all parties involved in the proceedings of a far greater magnitude than in normal CA98 investigations. A more reasonable (but still challenging, as we argue below) alternative would be for the CMA to offer partial redress directions, focusing exclusively on the aspects that are expected to be more common amongst claimants (level of consumer overcharges, volume effects and pass-on), while leaving the effort of proving how such an effect would be distributed to individual claimants and collective proceedings through a follow-on claims process. This model might provide savings if, as suggested in the CMA response,17 claimants are numerous and individual stakes are small.

Even within this narrower scope, however, the hurdle would be significant. By way of example, consider the assessment of pass-on in the context of infringements that affect consumers across different sectors.18 The CMA might face a difficult choice between data- and resource-intensive analyses that could take months (if not years), and a broad axe that could over- or undercompensate the actual damage. Ultimately, while the CMA’s proposal moves from a good intention, we consider that its implementation would be difficult if not impossible, and at the very least might come at a risk of diverting critical resources away from the CMA’s investigative role.

TL4 Essay Competition At any rate, we argue that whatever reform is ultimately implemented, it should account the impact on firms’ incentives and the complexities of the multilateral enforcement setting in which firms operate, as well as the institutional and legal challenges that such proposals would bring. aken together, our discussion T highlights serious risks associated with the CMA’s proposal, or at the very least points to material uncertainties regarding changes that would bring the UK further away from the principles that have so far guided enforcement models in the U.S. and the European Union.

Conclusions Taken together, the CMA’s proposals point towards a model in which the equilibrium between public and private enforcement would be materially tilted in favour of the former, both in relation to uncovering infringements as well as delivering redress. hether this rebalancing will strengthen W or weaken enforcement, will depend on specific design choices that will be difficult to calibrate ex-ante, as well priors about the number of infringements a bolstering of the leniency programme might uncover.

COMP/E-1/37.857 – Organic Peroxides, paragraph 412; Commission Decision in Case COMP/E-1/38.240 – Industrial Tubes, paragraph 210. See also: https://www. compasslexecon.com/insights/publications/quantifying-harm-in-the-presence-of-heterogeneous-effects-of-an-infringement . 17

CMA response, paragraph 22.

18 Just by way of example, one might consider the ongoing Merchant Interchange Fee Umbrella Proceedings 1517/11/7/22 (UM) that are being heard at the CAT, where thousands of companies across all UK retail sectors are claiming damages against Visa and Mastercard.

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TL4 Essay Competition

CMA PROPOSALS

A SHIFT FROM PRIVATE CLAIMS TO PUBLIC ENFORCEMENT? Authored by: Nanret Senok (Associate) - Linklaters The CMA has proposed in its response to the DBT’s call for evidence in relation to its review of the opt-out collective actions regime two proposals relating to the relationship between public and private enforcement; • F ull immunity from damages for Type A leniency applicants in cartel cases in order to protect its leniency regime • E mpowering the CMA to issue directions for redress so as to avoid the need for follow-on damages claims If enacted how do you think these proposals would change the role of public enforcement and what do you think the impact would be on private claims?

Enforcement of Competition Law in the UK In the UK, the Competition and Markets Authority (“CMA”) and other sector regulators have statutory powers and tools to detect, investigate, and penalise competition law infringements.1 As public enforcers, they act in the public interest of promoting competition and protecting consumers.2 Meanwhile, individuals or businesses which have suffered losses as a result of anti-competitive behaviour can seek compensation through private litigation. Private enforcement actions can take the form of a standalone action or a followon action (which relies on a regulatory competition infringement decision). In 2015, collective actions were introduced to allow a group of claimants affected by anti-competitive conduct to obtain redress through a single standalone or follow-on claim.3 Unlike public enforcers,

private parties are generally motivated by their own interests based on the harm they believe has been suffered. While public and private enforcement have different incentives for pursuing competition law breaches, they are, in principle, designed to work concurrently to bring anti-competitive conduct to an end; punish the infringer(s) and deter them and others from breaking the law; and achieve corrective justice for those harmed by the unlawful behaviour. As expressed by the CMA in its response to the government’s recent consultation reviewing the opt-out collective actions regime,

1 ‘Competition law infringements” refers to the prohibitions under Chapter I and Chapter II of the Competition Act 1998. 2 United Kingdom Competition Network, ‘United Kingdom Competition Network (UKCN) Statement of Intent’ (2012) <https://assets.publishing.service.gov.uk/ media/5a7d5cc8ed915d28e9f39d3b/UKCN_Statement_of_Intent.pdf> accessed 7 December 2025. 3 Explanatory Notes to the Consumer Rights Act 2015, para 434. 4 CMA, ‘Opt-out collective actions regime review: call for evidence, Response from the Competition and Markets Authority’ (October 2025) <https://assets.publishing.service.gov.uk/ media/68f638be06e6515f7914c818/CMA_response.pdf> accessed 25 November 2025.

ThoughtLeaders4 Competition Supplement • ISSUE 12 To work together well, the objectives and roles played by public and private enforcement should be distinct and complementary. Reforms made to the existing regime should ensure public enforcement effectively utilises its powers and finite resources for the public good, while also improving the accessibility, feasibility, and impact of private actions.

Cartels: Balancing the Tension between Cooperation and Private Liability Cartel activity is generally regarded as the most serious and harmful type of anti-competitive behaviour, and it is difficult to uncover because they are secret arrangements. Public enforcement is regarded as vital for investigating cartel activity as regulators can minimise the risk of tip-offs or evidence destruction through its investigatory tools, such as surveillance, covert intelligence sources, and unannounced inspections.5 The CMA’s leniency policy encourages businesses and individuals to proactively report their involvement in cartel conduct and cooperate with the CMA in return for immunity or reduced penalties. Avoiding serious financial penalties (up to 10% of worldwide turnover), criminal liability, and director disqualification are clear incentives to apply for leniency, and immunity is only available for the first applicant where there is no pre-existing investigation (i.e. the ‘Type A’ applicant). In private actions, all cartelists are jointly and severally liable for the entire harm caused by the cartel conduct. If the infringements and harm occurred

after 9 March 2017, the liability for immunity recipients is limited to harm caused to their own direct and indirect purchasers (provided the other cartelists can fully compensate the affected parties).6 The CMA’s leniency policy notes that offering leniency benefits private enforcement, as effective enforcement against previously undetected cartels allows victims to seek compensation using the CMA’s infringement findings.7 However this is also a relevant factor for prospective leniency applicants, who may be dissuaded from applying because of the high or unknown level of liability they would be exposed to if the cartel activity came to light. The risks have arguably increased since the introduction of collective actions, as follow-on actions can now be filed on behalf of a class (such as consumers) on an “opt-out” basis. As a result, there is an unavoidable conflict between the public importance of uncovering collusive behaviour and the compensation rights of those harmed by the collusion. If full immunity from damages was provided to Type A applicants, this would align with the public policy aims of detection. Leniency is intended to reduce the punishment otherwise owed to an admitted cartelist, and this is justified on the public interest grounds of tackling and deterring anti-competitive behaviour.8 While the proposal is consistent with the public enforcement role in uncovering and ending cartel conduct, this will undermine the justice that can only be achieved through effective punishment. Often the purpose of cartels is to increase the cartelists’ profits at the expense of the purchaser or endconsumers, and economic literature suggests that cartels typically result in raised prices (i.e. an overcharge).9 The proposed full immunity means one cartelist will effectively go unpunished and retain the economic gains from their unlawful behaviour. This could damage public trust and disincentivise public engagement in the regime, especially in cases where the Type A applicant orchestrated or benefitted the most from the cartel.

Mark Jephcott, Law of Cartels (2nd edn, Jordan Publishing Limited 2011) para 3.1

Competition Act 1998, sch 8A.

TL4 Essay Competition Fewer private actions would be filed if fewer competition harms were uncovered by public enforcers. This proposal will therefore have a positive impact for potential victims, but only if it leads to more public enforcement action. Victims will still be able to pursue full compensation from the remaining cartelists (subject to any financial or insolvency issues). Notwithstanding this, the magnitude of the additional liability facing the remaining cartelists (due to there being one less party to divide the costs) could negatively influence their incentives to engage in settlement discussions or narrow the issues in dispute. This would affect the cost, time, and complexity of these claims, and ultimately have a greater strain on court and tribunal resources. Instead of increasing the rewards gained by immunity applicants, public enforcers should actively consider whether modern competition enforcement calls for new or improved detection tools. A 2023 OECD report found that leniency applications have declined globally by 65% between 2015 to 2021.10 While this doesn’t diminish the importance of the leniency regime, greater efforts can be made to improve public awareness of competition law, facilitate whistleblowing reports, and use new technologies to develop effective cartel screens to uncover suspicious market behaviour. The CMA has made efforts towards this by adopting data analytics and AI tools to identify suspicious behaviour.11 Developing successful alternative detection tools would likely also incentivise more cartelists to come forward.

Should the Role of Public Competition Enforcement Include Corrective Justice? Private enforcement has generally been regarded as the primary avenue for securing compensation from firms that have breached competition law. In the United States, private antitrust remedies have always been a central feature of its enforcement regime, the rationale being that the motivations for seeking compensation are an important tool in

7 Competition and Markets Authority, ‘CMA210 Applications for leniency and no-action in cartel cases’ (28 October 2025), 2 <https://assets.publishing.service.gov.uk/ media/68ffa89b394b8c2a6ddf5dce/___Applications_for_leniency_and_no-action_in_cartel_cases___.pdf> accessed 25 November 2025. 8

ibid 6.

9 London Economics, ‘The Nature and Impact of Hardcore Cartels, A report to the Danish Competition Authority’ (January 2011), 11 <https://www.londoneconomics.co.uk/wp-content/ uploads/2011/09/7-The-nature-and-impact-of-hardcore-cartels.pdf> accessed 7 December 2025. 10 OECD, ‘The Future of Effective Leniency Programmes: Advancing Detection and Deterrence of Cartels’ (9 June 2023), 8 <https://www.oecd.org/content/dam/oecd/en/publications/ reports/2023/06/the-future-of-effective-leniency-programmes-advancing-detection-and-deterrence-of-cartels_a054b4db/9bc9dd57-en.pdf> accessed 25 November 2025. 11

Juliette Enser, Executive Director for Competition Enforcement, UK CMA, ‘Competition enforcement – a view from the CMA’ (Speech at CompLaw: Advanced EU, 16 May 2025).

TL4 Essay Competition

ThoughtLeaders4 Competition Supplement • ISSUE 12 deterring anti-competitive conduct.12 The courts in the UK and EU have long affirmed the right of private parties to recoup losses suffered at the hands of anti-competitive behaviour,13 and have made sweeping reforms to embed an effective private enforcement system.14 If the time, cost, or effort required to bring a claim outweighs the potential redress, a private party may forego bringing a claim irrespective of the public interest reasons. For collective actions, the necessity of securing adequate funding means these claims are just as much a commercial decision as it is about securing compensation and justice for those unable to bring their own individual action. The CMA’s proposed discretionary power to order a mandatory redress scheme would effectively place some responsibility for corrective justice in the hands of the state. Although similar redress powers are available to public enforcers in other contexts (such as breaches of consumer law), this proposal would be a departure from the traditional view that securing non-voluntary financial redress for competition law infringements is outside the scope of public enforcement. The introduction of a mandatory redress scheme was one of the proposed changes included in the government’s 2012 consultation on reforms for private actions. Within the consultation the government noted it was

“important that any new role does not detract from the OFT’s existing role of detecting, examining and sanctioning anticompetitive activity”15 Instead, voluntary redress schemes were introduced to encourage infringing parties to offer reparation to affected parties as an alternative to private litigation, with the added incentive of a

possible penalty reduction.16 The CMA’s role in certifying voluntary redress schemes only extends to reviewing the scheme’s process, including whether it is fair, reasonable, and adequate.17 This fits within the CMA’s public interest duties and leaves the value of redress in the remit of private parties. If public enforcers were to mandate redress, this would be better suited for cases where the public interest reasons for adequate compensation significantly outweigh leaving the matter in the hands of private party incentives. For example, last year the CMA secured a £23 million voluntary payment to the NHS from Vifor Pharma,18 which directly benefits the UK’s public healthcare system. This weighs in favour of encouraging greater uptake of the existing voluntary redress scheme instead of using additional public resources to facilitate mandatory compensation. A mandatory redress scheme would likely result in fewer follow-on actions, although this depends on the frequency and type of cases where discretion is used to require redress. Additionally, it’s unclear where private litigants would stand in cases where the same conduct is investigated by multiple regulators worldwide. For example, a standalone claim could be filed in the UK based on the regulatory findings of a foreign competition regulator before the public enforcer has completed its investigation in respect of the same conduct.19 It is also possible that aggrieved affected parties could file claims challenging the terms of the scheme itself if they disagree with the level of compensation awarded. For standalone actions, the scheme’s impact is less clear. The assessment would likely assist the court or tribunal’s consideration of the polarising views of the litigating parties. The effect on the parties depends on their view of the enforcer’s analysis, especially if it results in less compensation for the alleged victims. It may place a claimant or class representative in the uneasy position of arguing against the views of the public enforcer, especially in cases where the CMA is an intervener.

Public enforcers could positively impact follow-on and standalone claims by including an effects analysis in their infringement decisions. Often a key area of dispute in private actions is proving the effects of the collusion, especially where there is asymmetry of information which favours the defendant(s). Analysing the effects of anti-competitive behaviour is within the existing functions of public enforcement and adds value to the compensatory objective of the private enforcement regime.

Conclusion If enacted, the two CMA proposals would reshape the dynamic of public-private enforcement without necessarily improving access to justice or compensation. While it is difficult to reconcile the conflicts between an attractive leniency policy and private rights to compensation, a radical change for immunity applicants is not justified if it means admitted cartelists are no longer effectively punished. Private enforcement is unlikely to see great benefits if public enforcers can impose mandatory redress schemes, particularly as public enforcement is not currently equipped for this function. Ultimately, reforms to the regime should aim to maximise both deterrence and compensation, and this can be achieved in a way that aligns with the public interest without undermining the private right to damages.

12 Katherine Holmes, ‘Public enforcement or private enforcement? Enforcement of competition law in the EC and UK’ [2004] 25(1) E.C.L.R 25; OECD, ‘Individual and Collective Private Enforcement of Competition Law: Insights for Mexico’ (25 October 2018), 27 <www.oecd.org/content/dam/oecd/en/publications/reports/2018/10/individual-and-collectiveprivate-enforcement-of-competition-law-insights-for-mexico-2018_9401b8f8/c457765d-en.pdf> accessed 7 December 2025. 13

Case C‐453/99, Courage v Crehan [2001] ECR I-06297, para 26; Garden Cottage Foods v Milk Marketing Board [1984] 1 AC 130, 144.

See the Damages Directive (Directive 2014/104/EU) in the EU (and implemented in the UK in 2017), and the Consumer Rights Act 2015 in the UK.

15 Department for Business Innovation & Skills, ‘Private Actions in Competition Law: A Consultation on Options for Reform’ (April 2012), para 6.40 <https://assets.publishing.service. gov.uk/media/5a79793340f0b642860d8671/12-742-private-actions-in-competition-law-consultation.pdf> accessed 24 November 2025. 16 Department for Business Innovation & Skills, ‘Private Actions in Competition Law: A Consultation on Options for Reform – Government Response’ (January 2013), 53-54 <https:// assets.publishing.service.gov.uk/media/5a795a65ed915d07d35b4c60/13-501-private-actions-in-competition-law-a-consultation-on-options-for-reform-government-response1.pdf> accessed 25 November 2025. 17 CMA, ‘CMA40 Guidance on the approval of voluntary redress schemes for infringements of competition law’ (14 August 2015) para 3.6 <https://assets.publishing.service.gov.uk/ media/5a819ff6e5274a2e8ab54ff5/Voluntary_redress_schemes_guidance.pdf> accessed 7 December 2025. 18 CMA, ‘NHS set to benefit from £23 million following CMA pharma probe’ (10 December 2024) <https://www.gov.uk/government/news/nhs-set-to-benefit-from-23-million-followingcma-pharma-probe> accessed 7 December 2025. 19 A real-world example of this is Ad Tech Collective Action LLP v Alphabet Inc., a standalone collective action in respect of Google’s conduct in the adtech market. The claim relies on infringements established by the European Commission, US Department of Justice, and French Competition Authority, while the CMA’s investigation into the same conduct is ongoing.

ThoughtLeaders4 Competition Magazine • ISSUE 12

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