Joint Committee on Draft Communications Bill Report


193. Clauses 140 to 142 and Schedule 7 make provision for appeals against decisions of a regulatory character (as opposed to decisions of a "legislative or quasi-legislative nature") made by OFCOM or the Secretary of State under Part 2 of the draft Bill, in other words relating to networks, services and the radio spectrum.[365] These appeals are to be determined on their merits. A further appeal can be made to the Court of Appeal or, in Scotland, to the Court of Session, but on a point of law only.[366] These provisions seek to give effect to the requirement of Article 4 of the Framework Directive to establish "effective mechanisms" for appeal against regulatory decisions to "an appeal body that is independent of the parties involved" and which "shall have the appropriate expertise available to it to carry out its functions".

194. The draft Bill proposes that the appeal body to hear appeals on merits be the Competition Appeal Tribunal (CAT), a new body to be established under Part 2 of the Enterprise Bill. This tribunal, unlike the existing Competition Commission Appeals Tribunal, is to be legally and operationally separate from the Competition Commission.[367] Derek Morris, the Chairman of the Competition Commission, while supporting the proposed role for the CAT in respect of SMP issues, for example, called into question whether that body would have the appropriate expertise available to it in order properly to consider appeals about price controls.[368] He explained that this was because the expertise developed on price regulation by the Competition Commission, which handles such appeals for other sectors, would not be available to the CAT, since that body will also be hearing appeals from the Competition Commission.[369] Derek Morris argued that giving price control appeals to the CAT when it lacked relevant expertise on its staff would be "disastrous". He proposed accordingly that price control appeals under Part 2 be heard by the Competition Commission, thus aligning the arrangements with those for other markets subject to sector-specific regulation.[370]

195. The Competition Commission Appeals Tribunal evidently considers that its successor body will combine wide experience of appeal procedures with a capacity to ensure appropriate expertise is available to it, both from its membership and from its ability to appoint experts to advise it on particular issues.[371] The borderline between SMP appeals, for example, and price control appeals may not be easy to draw. Article 4(2) of the Framework Directive prescribes that, where the appeal body is not judicial in character, its decisions shall be subject to review by a court or tribunal; it is important for the Government to clarify whether judicial review would comply with this requirement.

196. Derek Morris made the point that there is no requirement for an appeal body under Article 4 of the Framework Directive to be judicial in character, provided that written reasons for a decision are always given.[372] The Government agreed that the proposal for price control appeals to be heard by the Competition Commission was not "at first sight incompatible with the Directives" and Patricia Hewitt confirmed that the Government was consulting on the matter.[373] The new framework of sector specific powers established in Part 2 of the draft Bill will require the body or bodies hearing appeals to secure appropriate expertise and bear in mind the specific characteristics of the powers being exercised. Provided that it would not entail a further appeal on merits, we see a case for price control appeals to be heard by the Competition Commission.

197. A major theme that emerged from our evidence was the potential for the swiftness, effectiveness and credibility of economic regulation to be blunted and undermined by a prolonged appeals process.[374] NTL saw one possible solution in a "leave to appeal" procedure to weed out vexatious appeals.[375] The most common remedy proposed was a specific time limit in the Bill for appeals.[376] Energis specifically proposed a limit of one month for bringing an appeal and a further three months for the conclusion of the appeal.[377] BT agreed that such a limit might be helpful in some circumstances.[378]

198. We have sought advice as to whether time limits of the kind proposed would be compatible with Convention rights and have been advised that in some circumstances a time limit as short as six weeks has been held to be compatible. We recommend that the final Bill establish a general time limit of four months for appeals under Part 2, subject to extension only in specified and exceptional circumstances. We further recommend that, in its response to this Report, the Government sets out its opinion on whether it would be compatible with the EC Directives and Convention rights either to introduce a "leave to appeal" mechanism or to give the appeal body powers to increase penalties in cases relating to enforcement where that body considers the appeal to have been an abuse of process.

365   EN, para 259. Clause 127 makes consequential provision with respect to rarely used appeal procedures relating to interference matters, EN, para 242. Back

366   EN, paras 262-263. Back

367   CCAT, pp 1-7. Back

368   Q 184. Back

369   Ev 629. Back

370   Q 184. Back

371   CCAT, pp 7-8. See also Ev 628, para 1.1. Back

372   Q 184. Back

373   Ev 409; QQ 984-985. Back

374   Memorandum submitted by Energis; Ev 89; Q 223. Back

375   Ev 58-65. Back

376   Memorandum submitted by COLT; Ev 62; Ev 89-90. Back

377   Memorandum submitted by Energis; Q 272. Back

378   Q 305. Back

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