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CBI responds to launch of Government consultation on private actions in competition law

The CBI responded to the launch of a Department for Business consultation on private actions in competition law.

Matthew Fell, CBI Director for Competitive Markets, said:

“It’s absolutely right that the victims of competition law breaches receive proper compensation. We are pleased that the Government shares our view that redress should be delivered in a cost effective way, with litigation a last resort. This means promoting Alternative Dispute Resolution methods which are increasingly being used by business, and often result in a better outcome for both parties.

“We are extremely concerned by the Government’s preference towards ‘opt-out’ class actions, which group potential claimants together without naming individuals. This will magnify the total amount of potential claims and fuel litigation.

“The introduction of ‘opt-out’ actions risks sowing the seeds of a class action beanstalk. In the US, they grew out of all proportion to the damage they were seeking to redress and had to be reined in by Congress.

“‘Opt-out’ actions will be inextricably linked with third-party investors and as a result are likely to create a new business in collective litigation, which is not the sort of industry we want to encourage in the UK.”

Notes to Editors:

The CBI is the UK's leading business organisation, speaking for some 240,000 businesses that together employ around a third of the private sector workforce. With offices across the UK as well as representation in Brussels, Washington, Beijing and Delhi the CBI communicates the British business voice around the world.

Private actions in competition law - a consultation on options for reform