Following a trial of preliminary issues on standing, the High Court (Coulson LJ, sitting as a Judge of the High Court) has dismissed legal claims challenging the lawfulness of the Gambling Commission’s award of the £8 billion Fourth National Lottery Licence, holding that (subject to narrow exceptions) non-bidders do not have standing under the Concession Contracts Regulations 2015 (the “CCR 2016”).
Camelot, the previous incumbent operator of the Third National Lottery Licence and second-placed bidder in the competition, had previously discontinued its legal claim following lifting of the automatic suspension. However, the IGT Group (Camelot’s “key subcontractor”, which describes itself as providing the ‘backbone’ of the UK National Lottery operations) continued to pursue claims under the CCR 2016. The quantum of the claims was said to be very substantial, i.e. well in excess of £100 million.
The Gambling Commission and the Interested Party, Allwyn (the successful bidder in the competition), contended that the IGT claims fell to be dismissed, regardless of the merits of the substantive allegations of breach of duty by the Gambling Commission in the conduct of the competition, on the grounds that none of the IGT claimants had any cause of action to bring proceedings under the CCR 2016 as they did not enter a bid.
The Gambling Commission and Allwyn submitted that the CCR 2016 fell to be construed consistently with the UK’s obligations pursuant to the EU law regime from which they derived. Because EU law only required a cause of action to be conferred by member states on commercial undertakings that had sought to obtain for themselves a relevant public contract, it followed that on the correct, purposive, interpretation of the CCR 2016 no legal right to bring proceedings was conferred on commercial operators such as the IGT claimants, who were sub-contractors (or legal entities further removed, such as sub-sub contractors or related group companies).
Moreover, the Gambling Commission argued that the UK had not gone further than the requirements of EU law (to extend standing to non-bidders) when implementing it in domestic law through the CCR 2016.
The IGT claimants contented that on a correct interpretation of the CCR 2016, the UK had gone beyond the basic requirements of EU law, and that the definition of ‘economic operators’ to whom a duty was owed was wide enough to embrace each claimant, notwithstanding that they had not directly bid in the procurement.
Following a trial of preliminary issues, Coulson LJ accepted Allwyn’s and the Gambling Commission’s legal submissions, and held that the IGT claims must accordingly be dismissed for lack of standing.
Joseph Barrett of 11KBW acted for Allwyn (the successful bidder) led by Charles Hollander KC (instructed by Quinn Emmanuel). He also acted for Allwyn in defending the Camelot claims.
Jen Coyne of 11KBW acted for the IGT claimants, led by Philip Moser KC and Ewan West of Monckton Chambers (instructed by Osborne Clark).
A copy of Coulson LJ’s Judgment can be found here.
