On 19 August, the UK government (through the Department of Culture, Media and Sport or DCMS) started a consultation on proposed changes to the legislative framework for appeals against Ofcom’s decisions relating to electronic communications matters (aka telecoms.)
The proposal is to insert a new sub-section into section 195 of the Communications Act 2003, which permits appeals against Ofcom’s telecoms related decisions to be made ‘on the merits’:
In deciding the appeal the Tribunal must apply the same principles as would be applied by a court on an application for judicial review, ensuring that the merits of the case are duly taken into account.
The intended effect of the proposal is to make appeals more difficult. The proposal is made against a market backdrop of many telecoms decision worth more than a nugatory amount of money being appealed. The reason for the large number of appeals is a view by market participants that an appeal ‘on the merits’ allows decisions to be reheard and so gives a good chance of over-turning adverse decisions, even if those decision are not objectively ‘poor’ decisions.
Readers will recall that changes required to implement the revised European common regulatory framework have already been made. A right of appeal ‘on the merits’ is provided for by Article 4 of the Framework Directive, which was modestly updated in the last set of revision. The proposal being consulted on is not made on the basis of implementing changes to the Framework Directive – rather that the initial implementation was defective in that it ‘gold-plated’ the requirements of the directive (consultation’s description). The consultation cites the Court of Appeal in T-Mobile (UK) Ltd v Ofcom  EWCA Civ 1373 in support of that proposition, and is made under the impression that introducing this legislative change will materially change the nature of appeals.
However, the consultation’s citation is rather misleading, as the case did not decide that issue, it being common ground between the parties, after a concession (paragraph 12 and following of the T-Mobile judgment) that: ‘if the route of challenge to the Award must be by way of JR rather than appeal to the CAT, such a route would be an “effective appeal mechanism” within the meaning of Art. 4.’
However, what is very interesting about the Court of Appeal’s judgment in the T-Mobile case is Jacob LJ’s endorsement of Ofcom’s submissions that judicial review is infinitely flexible and that it would allow appellants the same opportunities as an appeal ‘on the merits’:
“…the JR standard of review can and does mould itself to any requirement imposed by other rules of law. [Ofcom’s counsel] did so to establish that the appellants would be in no way disadvantaged if they had to go via the JR route as compared with the CAT.” – paragraph 20.
Without wishing to rain on DCMS’s parade, if this is right, then whilst the proposed change will almost certainly lead to procedural changes, and the way that appeals are pleaded, it rather suggests that the change will have no impact on the substantive consideration of appeals by the courts and so on the incentives for the appellants. My view seems to be shared by the CAT itself from the DCMS’s summary of their views on the proposed change.
So what happens next? Responses to the consultation are due by 14 October, which will be considered through the autumn with statutory instruments laid before Parliament in the spring and revisions coming into effect on 6 April 2012. It will only be after consideration by the courts that the impact (or lack of impact) of this change will be tested.