UK voluntary redress for antitrust infringements: the scheme takes shape

One of the radical elements of the UK’s package of 2015 collective redress measures takes shape as regulations and guidance governing approval of voluntary redress schemes to compensate persons injured by antitrust infringements are published.

In brief

From 01 October 2015, under the Consumer Rights Act 2015 the Competition & Markets Authority (CMA) and UK Regulators with concurrent competition law powers will be able to approve schemes of voluntary redress put forward on behalf of infringers of antitrust law.

While there are likely to be some cost benefits also for the infringing party compared with facing private actions for damages in the courts, and through the possibility that, in ongoing UK infringement cases, it might also benefit from a discretionary reduction in penalty of up to 20%, the cost of implementing a scheme and meeting the costs of the Authority is likely to be substantial, quite apart from the compensation offered.

Key issues


On 05 August 2015, the UK Secretary of State issued the Competition Act 1998 (Redress Scheme) Regulations 2015 governing the approval of voluntary redress schemes under the Act. These confirm that:

  • a detailed scheme must be devised by an independent senior lawyer as chairperson and high calibre independent board and recommended by a majority of them to the Competition & Markets Authority or a Regulator with concurrent competition law powers, and
  • the chairperson and board must consider evidence of the loss caused, who is entitled to compensation under the scheme, how they are to apply and support their application for compensation, and how they will be notified that they are entitled to redress.

Further information must be provided confirming

  • the identity of the board chairperson, and that there are no conflicts of interest involved
  • details of arrangements to ensure that relevant information has been provided to them
  • details of the process for applying for compensation, and
  • an estimate of how long it will take to decide on applications as well as of an independent complaints process.

No third parties are permitted to submit a claim on behalf of the injured persons, and the scheme must operate for at least nine months.

CMA Guidance

On 14 August 2015, the Competition and Markets Authority published its final Guidance on the redress scheme, aimed at businesses planning to seek approval for a scheme and the chairperson and members of the board appointed to devise a scheme. An infringing business can apply on its own account or jointly with a co-infringer for approval of a scheme, either while an investigation is ongoing (in which case, in an investigation by the CMA or a UK Regulator, a discount of up to 20% on the fine may be granted), or when it is complete. A redress scheme can also be offered in relation to a European Commission infringement decision. The guidance explains that the voluntary redress scheme is an additional route to compensation, which, for injured parties, should provide a quicker, easier and less expensive alternative to litigation, and for the infringer, may avoid lengthy and costly court proceedings and secure reputational benefits.

Other key points: 

  • The CMA has discretion as to whether to prioritise assessing an application for scheme approval, so pre-application discussions are crucial to identify whether it is likely to do so. The Guidance confirms that the CMA expects to prioritise applications in all ongoing investigations. However, it will normally only consider applications in cases where the applicant has appealed a decision if the appeal is against the level of fine, not against liability in general.
  • In an ongoing investigation, the applicant can submit either a full scheme, or an outline scheme subject to conditional approval. In relation to an existing infringement decision, only a full scheme can be submitted. Although the board and chairperson are responsible for devising the scheme, applicants are able to suggest key parameters and share their ideas. The applicant is expected to co-operate fully with the Chairperson and Board members in terms of providing information and access within the timescales agreed.
  • The Board will consist of a minimum of four people: a Chair (senior lawyer or judge), an economist experienced in competition economics, an industry representative with experience of the relevant industry and/or its customers, and at least one representative of the potential beneficiaries, depending on whether there is more than one category of beneficiary, such as direct and indirect purchasers. This could be a representative of a consumer body (such as Which? or Citizen’s Advice), a group specific to a particular industry or an independent academic institution.
  • Each member of the Board and the Chairperson is required to act independently, impartially, objectively, honestly, and with integrity.
  • The function of the Board is to determine the scope and level of compensation under the scheme and consider the broader scheme framework, for example, its terms and duration; details of how beneficiaries should apply and what evidence they need; the complaints procedure; how the scheme will be advertised and potential beneficiaries notified; and the consequences of accepting redress. It should also consider evidence related to the harm caused. The CMA expects that the need for independent economic evidence and experts (beyond the economist on the Board) in order to assess the compensation should be significantly less than in a litigation context and should be kept to the minimum reasonably necessary, for example, to determine the level of passing on of the overcharge when identifying the level of compensation appropriate for indirect or consumer purchasers.
  • The Board and Chairperson must seek sufficient information to ensure that they are fully satisfied that the terms of the scheme and the amount of compensation offered are appropriate.
  • The Board must approve the proposed scheme by majority vote and is collectively responsible for the decision even if the decision is not unanimous. Where there is a deadlock in the votes, details of the dissenting views must be provided to the CMA, which may seek a replacement scheme that addresses the issues identified by the dissenting members.


Publication of the Regulations and Guidance followed hot on the heels of Commencement Order No. 2 of the Consumer Rights Act 2015, which brought aspects of the Act into effect on 03 August to enable regulations and guidance to be published ahead of 01 October 2015 when the Act comes into force. As the Explanatory Memorandum to the Regulations describes, the extension of the scheme so that the concurrent regulators can approve a redress scheme in addition to the CMA is a new departure, triggered by the recognition - too late for it to be included in the Act - that a penalty reduction in acknowledgment of a redress scheme could not be offered to parties investigated by a concurrent regulator if only the CMA was mandated to approve schemes and in relation to its own infringement decisions. This change in approach is welcome.

It remains the case that whether or not the CMA and regulators will consider a voluntary redress scheme is discretionary, as is the ultimate decision to approve a particular scheme that complies with the Regulations. There are therefore no guarantees that a willing infringer will be able to enter into a scheme, even after facing significant costs to appoint an expert board to devise and apply for a scheme. However, the Guidance confirms that the CMA would expect to reject decisions of the Chairperson and Board only in exceptional situations, and as a further safeguard, decisions taken in relation to schemes, including a decision to reject an application, could potentially be challenged by way of judicial review.

Approval of a voluntary scheme may not avoid litigation claims altogether. A potential beneficiary could still bring an individual private action against an infringer or participate in an opt-in or opt-out collective action. However, the CAT Rules of Procedure will allow the CAT to take into account whether ADR (including an approved redress scheme) has been undertaken, and whether it is available at the certification stage, when it considers whether a proceeding should be opt-out or opt-in, and at the costs stage. In particular, the CAT can take into account any ‘without prejudice save as to costs’ offers to settle that the infringer formally makes in litigation. This offer might in turn be based on the amount of compensation that the infringer had proposed earlier in the context of a voluntary redress scheme.

The increase in the scale of the discretionary penalty reduction from up to 10% to a maximum of 20% is welcome. The lower level may not have provided a particular incentive to engage in the voluntary redress process, bearing in mind the cost and calibre of the board of experts required, and the need to meet the Authority’s costs, in addition to the compensation to be paid. Whether it proves sufficient remains to be seen once the approval scheme becomes an option on 01 October 2015.

This document (and any information accessed through links in this document) is provided for information purposes only and does not constitute legal advice. Professional legal advice should be obtained before taking or refraining from any action as a result of the contents of this document.