Hiu Man Chan
Credit Default Swaps (EU)
The European Commission issued a Statement of Objections against our client IHS Markit, ISDA and many CDS dealing banks, alleging that these firms had frustrated the development of central limit order book (CLOB) on-exchange trading of CDS indices. The Commission asserted that on-exchange trading would have increased liquidity and thus reduced bid-ask spreads. This matter was also subject to parallel investigations by the US Department of Justice.
Our economists wrote a detailed expert report and presented at the Oral Hearing at the European Commission, describing why the Commission’s theory of harm was inconsistent with how the CDS market worked and the large body of contemporaneous documents and market information.
After the Oral Hearing, the European Commission dropped the various CDS dealing banks from its investigation and closed its investigation, after accepting commitments from IHS Markit and ISDA. No infringement finding was reached. The US Department of Justice also dropped its investigation.
Premiership Rugby v Saracens Rugby club (UK)
We acted as an economic expert for Premiership Rugby in its dispute with Saracens Rugby club, which claimed that the league’s salary cap rules infringed competition law. Saracens had been found to be in breach of financial fair play rules and the governing body imposed an unprecedented 35-point penalty, effectively condemning the long-standing top-flight club to demotion to a lower league. The dispute involved a detailed examination of the consistency of financial fair play rules with competition law, and our expert produced reports and testimony on the likely economic effects of the rules on sports markets like rugby. Our expert’s report addressed issues concerning market definition, as well as the likely economic effects of the salary cap for competitive balance and financial viability.
A specialist sports arbitration panel found in favour of Premiership Rugby and the point penalty was upheld.
Asda et al v Visa (UK)
We were retained by Visa Inc as an expert witness in a lawsuit brought by multiple UK retailers in relation to the setting of multilateral interchange fees (MIFs) by the payment card network. MIFs―payments made by card issuers to card acquirers under the Visa scheme rules―had received much attention by competition authorities for decades and had been found to infringe competition law by the European Commission.
We produced expert reports and gave evidence in the London High Court during a 38-day trial on the economics of the multi-sided payment card market, the appropriate counterfactual scenario, and the nature of competition under that counterfactual.
In November 2017 the High Court found in Visa’s favor that MIFs did not restrict competition because they did not affect the process of competition when compared to the counterfactual scenario. The case was successfully appealed to the UK Supreme Court―only the second competition case to do so―and remitted to the Competition Appeal Tribunal for further consideration. The case eventually settled.
Major smartphone manufacturer (UK)
We were retained by a major smartphone manufacturer and implementer of 3G standard essential patents (SEPs) to act as an expert in an English High Court claim brought against it by an owner of 3G SEPs. Part of the dispute related to the interpretation of the Intellectual Property Rights Policy of ETSI, the European Telecommunications Standards Institute, and the implications of this for competition in technology and smartphone markets. Our expert provided a view on whether some interpretations on the policy implied a potential impact on competition, leading to restrictions of competition contrary to Article 101 TFEU or potential abuse of a dominant position contrary to Article 102 TFEU. The case was settled before expert evidence was heard.