Digital Markets, Competition and Consumers Bill

Debate between Lord Faulks and Lord Vaizey of Didcot

Committee stage
Monday 29th January 2024 Grand Committee

[Lord Faulks (Non-Afl)]

My Lords, may I crave the indulgence of the Committee? Unfortunately, I missed the first minute of the speech made by the noble Baroness, Lady Jones, as I was trying to comply with etiquette and remain in the Chamber until the conclusion of the opening speeches on the Rwanda Bill. If the Committee permits, the points I was going to make have largely been made by others, so I can be particularly brief.

At the heart of this legislation is the decision: do we want the regulation to be done by the DMU or, de facto, by the courts? This is, effectively, a twin attack. First, there is the proportionality provision inserted into the statute, and now we have the change in the test of appeals on sentences. The combination of those two seems inevitably to lead to further court involvement, and it is not the intention that courts should be the regulator. The courts are there, as the noble Lord said, to stop executive overreach or some illegality in the approach based on usual JR principles. They are not there to second-guess what the DMU has done.

If the amendments, or something like them, are not accepted, I fear that an appeal of the merits will involve going into everything, as other noble Lords have said. We would have the war of the lever arch files, so eloquently described by the noble Lord, Lord Vaizey, at Second Reading. Lawyers will act, and continue to act, and it will frustrate what we are trying to achieve.

[Lord Vaizey of Didcot (Con)]

My Lords, as I have been cited by the noble Lord, Lord Faulks, it is incumbent on me to speak on the same principles as him. Everything that I want to say has already been said, but that will not stop me putting in my two pennies’ worth. This is the stuck-record part of the debate, where I repeat what I said at Second Reading and simply put on record my support for all these amendments.

I will pick up on what some noble Lords said in their comments. I wholeheartedly endorse what my noble friend Lady Stowell said. In the real world, if you have an appeal on the merits of a fine, it seems almost impossible to see how you stop leakage into an appeal on the merits of the case. So you are, in effect, back to square one and, as the noble Lord, Lord Faulks, put it, the war of the lever arch file.

The speech by the noble Lord, Lord Tyrie, was fascinating and a master class on the different aspects of judicial review: an appeal on the merits, an appeal on JR-plus, or an appeal on JR. When I was a Minister, I dealt with this debate with Ofcom, when it started the process of wanting to move from appeals on the merits to appeals on JR. To the layman, an appeal on the merits is in effect a full rehearing of the case: you go back to square one and simply have the trial all over again. An appeal on JR means that you at least have to identify a flaw in the reasoning of the regulator when it comes to a judgment. If, in effect—here, I bow to the expertise of the noble Lord, Lord Tyrie—settled law informed by European directives means that some element of the merits of the case are taken into account in a JR appeal of a regulator, so be it. It may be the difference between a passive and an active decision, as it were.

In this Committee, we understand how you can judicially review a decision by a government department. When a regulator is making an active decision to bring a prosecution, and it then finds guilty the company that it is prosecuting, some element of the merits may well be taken into account. It seems to me that how it is drafted may well be important, but the clear intent should be that any appeal, whether on the actual decision or the level of the fine, should be an appeal based on JR, when it comes to how a judicial review is understood when appealing a decision by a regulator.

I finish with the simple point—this is the stuck-record part—that it clearly is the settled will of this Committee, and I suspect it will be the will of the House when this comes to Report, to constantly guard against giving the SMS companies too much opportunity to wriggle out of decisions made by the regulator.

I should add that a lot of the tone of my remarks at Second Reading and in Committee might make it seem that I am in the pocket of the regulator. I am certainly not. I have lots of concerns that, at other times, would make me say that I think the regulator often strays too far and interferes in far too many cases. I am not resiling from the fact that there clearly should be an opportunity to appeal its decisions. Often, it backs away before it gets to a decision, but its interference in mergers and takeovers sometimes leaves me slightly baffled, particularly when it involves companies that have very little presence in the UK market. I am not saying, by any stretch of the imagination, that the regulator is perfect, but I know that any procedure it undertakes, as it will do when this law is passed, will be long and expensive, so we must guard against making it even longer and even more expensive.