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The Competition Appeal Tribunal (CAT) has handed down its much awaited judgement in the “Boundary Fares” cases. It held the Train Operating Companies had not abused any dominant position they may have as a result of their conduct in relation to so-called Boundary Fares.

Collective Proceedings (or mass claims based on an infringement of UK Competition Law) have been much in vogue in recent years as private enforcement of Competition Law has become a reality in the English Courts. A number of claimants and their advisers have sought to bring Collective Proceedings which have a very tenuous basis under UK Competition Law.

In the rail fares litigation, the claimant (or class representative) sought to broaden the types of behaviour deemed to be an “abuse of a dominant position” to include:

1. Failure to make Boundary Fares sufficiently available for sale to customers holding a valid TfL Travelcard, and
2. Failure to ensure that customers holding a valid TfL Travelcard were aware of the existence of Boundary Fares when buying tickets.

Having reviewed the evidence, the CAT unanimously concluded, on the assumption that the three Train Operating Company defendants each held a dominant position, none of the conduct alleged against them constituted an abuse of that position.

Whilst “abuse” is a broad concept and the concept of exploitative abuse by “unfair” conduct should develop to reflect new patterns of commerce, the CAT observed the concept is not unlimited. It also observed that Competition Law is not a general law of consumer protection.

The fact that the dominant company could have carried out a particular aspect of its business better, or in a different way that would have benefited consumers, does not mean that this conduct crosses the line to constitute “abuse”.

Strong and compelling evidence is required to establish abuse of a dominant position, and this was lacking in the rail fares litigation. There were particular reasons why so-called Boundary Fares were made available in the way that they were by the three Train Operating Companies, and the fact that passengers did not buy a Boundary Fare or bought smaller numbers of Boundary Fares compared to the number of Travelcards sold, did not establish that they were unaware of this option.

The CAT noted that a dominant company has no duty under Competition Law actively to assist all its customers to pay the lowest price or to buy the optimal product for their needs. It was accepted that it would have been possible for the Train Operating Companies to do further marketing in relation to Boundary Fares. However, this was just one type of fare among many. Each company had to choose its priorities, both in terms of expenditure generally and as the subject of its marketing campaigns.

Collective Proceedings are an expensive form of litigation often funded by litigation funders. When chosen appropriately, such proceedings can help to bring redress to persons who would otherwise find it difficult to pursue a valid claim. A number of Collective Proceedings claims in the English Courts have either failed or have recovered much smaller sums than were originally claimed. This is to be expected as a system develops and “finds its feet”.

Litigation funders and lawyers alike can be expected to study carefully the findings of the CAT in the rail fares litigation. There are lessons to be learned from this litigation and other Collective Proceedings actions.

Such claims will continue to be brought but may become more limited to situations where the legal basis for the claim is clear and/or the level of loss to class members is readily ascertainable.

In the meantime, the Train Operating Companies in the rail fares litigation will feel relieved that the concept of “abuse” has not been extended to cover situations not previously found to constitute a breach of the so-called “special responsibility” which applies to dominant companies.