Government consults on consistent, streamlined regulatory appeals process

It is consulting on simplifications to the appeals processes used by businesses appealing a decision made by regulators including the Office of Fair Trading (OFT), Competition Commission, Ofcom and Ofgem.

Business minister Jo Swinson said that the changes had been prompted by concerns that the current appeals processes are too slow and costly, with not enough opportunities for businesses and regulators to share information before decisions are made. She said that the recent delays to the 4G spectrum auction showed that appeals and the threat of litigation could hold up important developments for consumers.

"It is only right that firms can hold regulators and competition authorities to account when they think the wrong decision has been reached," Swinson said. "But it is in nobody's interest that appeals end up being unnecessarily lengthy and costly."

"A new streamlined system will mean that businesses see their appeals sorted quicker and that they and regulators spend less time and legal resources on disputes. Reduced delays will help build a stronger economy and provide better outcomes for consumers," she said.

The Government committed to simplifying the appeals framework, which costs around £22 million annually, as part of this year's Budget. Appeals across different sectors have evolved over time, resulting in a number of different routes across the regulated sectors. Although some of these differences reflect genuine differences in the nature of the decisions being made, concerns have been raised that this causes confusion for businesses, according to the Government.

Along with these concerns, the Government said that the current system created "strong incentives" for some companies, in sectors such as telecoms, to bring unnecessary appeals. These included the recent examples of the appeal against Ofcom's proposals for the award of the 2.6Hz 4G spectrum, and the regulator's two-year legal battle with BSkyB's over the pay-TV market, it said.

The consultation proposes that sectors where appeals are currently heard 'on the merits' should either use a judicial review standard, or set out defined grounds of appeal stating the basis on which firms can challenge a regulator's decision. The aim of this would be to restrict appeals to cases where the regulator has made an unreasonable decision, or where it has made a mistake which has had a "material impact" on the outcome of the review.

Other proposals would see new restrictions on when new evidence could be admitted during an appeal, including costs sanctions where evidence that was previously available is introduced late in the process. The Government also plans to encourage regulators to claim their full costs, and seeks views on whether courts should only award costs against a regulator that has acted unreasonably.

The consultation proposes the introduction of fast-tracked procedures for simple cases, and encouraging certain disputes to be resolved by referring to paper submissions rather than oral hearings. It also sets out specific reforms to appeal bodies, including reviewing the governance of the Competition Appeal Tribunal (CAT).