The BEG scholars report on the Bar European Group’s overseas meeting in 2019, held in Poland on the theme ‘The EU and the UK: solidarity past, present and future’.
For many lawyers, the Polish city of Gdansk on the Baltic coast may perhaps be best known for the Stocnzia Gdanska litigation 20 years ago, which gave rise to important judgments on the law of contractual repudiation. But the city in fact has a far more ancient (and often troubled heritage), and was long fought by Polish and German forces. Originally of Polish foundation, it was subsequently overrun by the Teutonic knights and had a substantial German presence from the late middle ages onwards. Later annexed by Prussia as ‘Danzig’, it became significant bone of contention during the great territorial reorganisation of Eastern Europe after the First World War, and was eventually granted special status as a ‘Free City’ under a League of Nations mandate (thereby avoiding the wholesale expulsion of the mainly German population and allowing the new state of Poland sea access to the west). However, its Germanic heritage made it a natural target for the Third Reich, and it was overrun in the first days of Second World War, only to be bombed by the Allies and finally razed virtually to rubble by the advancing Soviets in the closing months of the conflict.
Few visitors today would guess that such destruction of old town had occurred; the post-war Polish authorities bravely decided to restore the historic centre to its former glory; their project largely succeeded, hence the broad, pedestrianised boulevards lined with tall Dutch-style buildings that visitors admire today.
The city’s more recent claim to fame in European history, though, is the role of its shipyards in creating the Solidarity movement, which through peaceful union activism eventually brought down Poland’s communist government and paved the way for the return of democracy across Eastern Europe. ‘Solidarity’ was indeed the theme of our conference, a fitting topic at a time when the shared values underpinning the European project are increasingly under threat.
Delivering the opening keynote speech, provocatively entitled ‘What has the EU ever done for us?’, Eleanor Sharpston compared European war to toothache – we easily forget how bad it is until it occurs – before sketching out the other benefits of the single market that many take for granted, from the lack of roaming charges abroad to workers’ rights.
The Polish academic Tomasz Koncewicz spoke next, lamenting the lack of a pan-European sense of the rule of law and reflecting on what he saw as the current Polish government’s attempts to pack the Supreme Court. The vigorous exchanges between Professor Koncewicz and another Polish delegate (of a different political persuasion) illustrated again how divisive this issue is in Poland and led us to reflect on what role the EU should have in regulating constitutional matters within member states.
After the keynotes, the conference got down to the bread and butter of EU law, as Mr Justice Barling chaired a panel series of short talks on class actions and telecoms, kicking off by speaking of the relatively recent introduction of opt-out class actions into the English court system, by way of the Competition Appeals Tribunal.
The first item from the panel was a stimulating talk from Daniel Lloyd, a Partner at TLT Solicitors, on the ‘FAANG Wars’ (“FAANG” referring to Facebook, Apple, Amazon, Netflix and Google). He spoke of the efforts of governments across the world to regulate the world’s digital leviathans, contrasting Europe’s relatively paternalistic attitude with the more laissez-faire approach taken by the US. Questions remain, he concluded, on whose approach the UK will follow after Brexit: will it follow Europe’s lead in taking on these giants with fines and regulation, keep hands-off, or find a third way?
Professor Stanislaw Pietak of the University of Warsaw followed, with a talk on the European Communications Code, due for implementation by 21 December 2020. This Code will cover everything from traditional communications to the ‘internet of things’ and internet-based messaging, but applying tailored rules to each. Professor Pietak also bemoaned the UK’s impending departure from the EU, noting his reliance over many years on Ofcom’s practical guides to EU telecoms law.
Dr Kamil Szmid, of the Warsaw Bar Council, closed off the first panel with a discussion of private enforcement of Polish competition law. Dr Szmid spoke of the importance of rights to private participation in state competition infringement proceedings, and to pre-action disclosure in this context. He argued that the present lack of either right, in Poland, was hindering Polish domestic markets and preventing legitimate damages claims from being brought.
After coffee, the conference reconvened with a series of talks on the GDPR, this time chaired by Lord Justice Green. After the mysterious disappearance from the agenda of ‘Douglas’ from GCHQ, who had been scheduled to speak but could not be found even behind any of the curtains, Tim Pitt Payne of 11KBW opined on whether the GDPR was ‘the dog that did not bark’. He concluded that the GDPR was, perhaps, a missed opportunity for data protection law to differentiate in its application between the Googles of this world, on the one hand, and small companies and organisations on the other.
Arwid Mednis, of PWC Poland and Warsaw University’s Faculty of Law, then went on to speak about cyber security and information protection. He wondered whether Poland’s relatively modest penalties of between €60,000 and €250,000 for data breaches would be enough to secure compliance, but had found businesses generally to be willing to implement reforms in light of the GDPR. He noted that the risks of non-compliance were not only about money and lost data, but could also post serious reputational issues for companies.
After lunch, the Conference enjoyed an informative session on “Competition Law in the UK and Poland”, with five speakers covering wide-ranging topics.
Fergus Randolph QC, of Brick Court Chambers, updated us on the Damages Directive, suggesting that it may be some time before cartel victims can rely directly on its substantive provisions. Domestic implementing regulations give retrospective effect only to its procedural provisions, and therefore not to useful provisions suspending the running of limitation periods. However, the recent Opinion of Advocate-General Kokott in Case C-637/17 (17 January 2019) reaffirmed that even where a case falls outside the Directive’s scope, national courts are still required to interpret limitation rules in light of the principle of effectiveness. Mr Randolph wondered whether, after Brexit, new anglophone courts in France and the Netherlands might challenge London as jurisdiction of choice for competition damages cases, which are on the rise.
Derek Holt and Felix Hammeke, of Alix Partners, spoke about quantification of damages after BritNed v ABB  EWHC 2616 (Ch), the first judgment in a follow-on damages case, in which Marcus Smith J dismissed the Claimant’s econometric evidence on overcharge as unreliable. They explained that lawyers need to give a judge the tools to answer three questions: but for the cartel, (1) would there have been a lower margin on the project? (2) Would the cartelist have reduced its costs? (3) Who would have won the project? They can all, in principle, be answered with a cost-proxy model; the rejection of the Claimant’s model in BritNed was fact-specific. As to the first, Marcus Smith J preferred a simple margin analysis. The second can be complex; expect to see more evidence from specialists (like engineers). The third question is crucial, but there was insufficient evidence to answer it in Britned. Disclosure from one Defendant is not enough. Finally, it is important to consider the model’s statistical power: its ability to detect a significant effect. It may be too low if there is insufficient data or if the drivers of price have not been correctly identified.
Malgorzata Modzelewska, of Modzelewska & Pasnik, addressed us on competition litigation in Poland; in particular, the rights of undertakings to defend themselves in proceedings brought by the national competition authority, Uokik. Since 2015, influenced by the EU process, Uokik has introduced the statement of objections. The Polish Supreme Court has also held that Uokik cannot change the factual basis for its case against the undertaking in the course of proceedings. The authority’s decisions can be appealed to the specialist Competition and Consumer Protection Court in Warsaw; this is a full review, with a right to introduce new evidence. In this respect, Poland has gone further than the European court.
Finally, Tomasz Wardynski CBE, of Wardyński & Partners, discussed a recent Commission Report on competition policy for the digital era. A few companies have vacuum-cleaned a huge amount of personal data, gaining market dominance and a strong incentive to behave anti-competitively. Articles 101-102 TFEU can meet the challenge, but the market is characterised by rapid change. New methodologies could include more flexible thresholds for regulatory intervention and a presumption that certain behaviours are anti-competitive. Guidelines need to be updated frequently and regulators could develop internal means of detecting anti-competitive behaviour (such as artificial intelligence). Overall, the area is uncertain, complex and ambiguous. Democratic values are at stake when controlling power in the digital economy.
That evening, we reunited with our Polish hosts for a fabulous dinner on the seafront in Sopot, just outside Gdańsk. After dinner, Lord Lloyd-Jones gave the keynote speech, a timely review of EU law’s far-reaching influence on the English and Welsh legal system. Indeed, delegates’ dissection of the night’s emerging EU election results dominated the trip back to Gdańsk.
The next morning kicked-off with a discussion of the free movement of persons, chaired by Sir Patrick Elias. Madeleine Sumption, Director of the Migration Observatory at the University of Oxford, spoke of the challenges of extricating Britain from the free movement of persons after Brexit. A crucial problem for Britain is that free movement is deeply engrained in the running of the nation, and in business models across every sector. Businesses that rely heavily on seasonal labour, or that involve jobs that few UK citizens are willing to do for the money – how many vets want to work in an abattoir – will face real difficulties. However, Ms Sumption ended on a positive note, emphasising that proposals currently on the table remain more liberal than those of many high-income OECD countries, and that ‘settled status’ offers a strong package of rights so long as people apply for it in time.
This was followed up by a talk from Evanna Fruithof, of the Bar Council’s Brussels office, on the New Services Package. She spoke of the ability of lawyers within the EU to relocate and to practise across borders, and of the ability of member states to regulate their legal professions but only to an extent that was proportionate. Dr Marcin Piechocki, LL.M, closed off the first round of talks by saying that lawyers had, in a sense, achieved a lot in being the only group covered by a standalone regulation on free movement. He spoke also of his own experience practising across borders, between Poland and another EU state.
After coffee, delegates reconvened for a panel chaired by Sir David Edward, on international trade and the EU. The first speaker was Professor Panos Koutrakos, of City University London and Monckton Chambers. Professor Koutrakos focussed in his talk on the recent Achmea decision, in which the CJEU guarded its powers jealously in the face of investment treaty proceedings that, in its view, sought to usurp its jurisdiction. The Court’s decision is an important one, and sought to introduce some clarity into this area of the law, but is at odds with the AG’s opinion in the same case. The decision is important in emphasising not only the procedural, but also the substantive, limits of arbitral tribunals’ jurisdiction. The Court was keen to emphasise that an arbitral tribunal cannot be allowed to question the level of protection that EU institutions deem appropriate for, for example, public order, health, and so on.
Mr Rafal Stepnowski, of Boeing in Gdansk, then gave delegates a break from the law, talking about international trade from a Polish perspective. He explained how foreign trade is a key driver of the Polish economy, especially given the country’s position in the ‘sweet spot’ of both being in the EU but also a relatively low-cost place to do business.
Professor Alastair Sutton, of Brick Court Chambers, took things back to Brexit. There was, he said, little clarity at present on how the UK’s trade policy will differ from the EU’s after Brexit. In particular, there is great uncertainty as to the export of services from the UK to other EU member states. The first challenge for the UK will be to roll over existing agreements with third countries once it leaves the EU, not to mention various international organisations. This is likely to entail a vast workload on civil servants.
Sir David Edward rounded off the discussion by noting that there is a risk, in these discussions, that policy makers and lawyers will forget the real impact of their decisions and advice. The EU is not only about trading goods. Those goods, and services, are transported and offered by real people, who travel and transact across national boundaries.
The conference concluded with a panel devoted specifically to Brexit, though the topic had inevitably dominated many of the other talks as well. Anneli Howard of Monckton Chambers mused on how far Britain had come in the course of three meaningful votes on EU membership (not very), and considered the wider impacts of Brexit for the UK constitution. Difficult decisions abound as to how far the courts can and should get involved in politics, especially when making anticipatory interventions to clarify the law. Ms Howard also drew attention to the interesting distinctions between the remedies available to the Scottish and English courts, in terms of declaratory judgments, which have been brought very much to the fore by Brexit litigation.
Professor Takis Tridimas, of King’s College London and Matrix Chambers, commented on the dispute resolution agreements in the withdrawal agreement, which provide for an arbitration panel with the ability to make references to the CJEU. Daniel Denman, of the Cabinet Office, rounded off with some observations on the key issues in dispute, and the EU’s stance in negotiations.
With Brexit now having come to pass, it is tempting to be pessimistic about the continuing links between the English and EU legal systems. However, amid the gloom there are voices of solidarity as well. As Fergus Randolph QC pointed out at the end of the final panel talk, there have been recent – and unilateral – moves by the Flemish bar to allow English barristers to continue practising law in Belgium post-Brexit. Moves like this lend hope to the idea that the links between the UK’s legal profession and that of other EU member states will remain strong for a long time to come.
The BEG scholars were:
Julie BallMartin Dabrowski
Tom van der Klugt