The claim is a collective action against (1) Barclays Bank PLC; (2) Barclays Capital Inc.; (3) Barclays Execution Services Limited; (4) Barclays PLC; (5) Citibank N.A.; (6) Citigroup Inc.; (7) JPMorgan Chase & Co.; (8) JPMorgan Chase Bank, National Association; (9) J.P. Morgan Europe Limited; (10) J.P. Morgan Limited; (11) NatWest Markets Plc; (12) The Royal Bank Of Scotland Group plc; and (13) UBS AG.
All of these banks have been named in one or both of the European Commission decisions dated 16 May 2019, together with MUFG Bank (formerly Bank of Tokyo-Mitsubishi).
On 16 May 2019, the European Commission handed down two decisions: the first against UBS, Barclays, RBS, Citigroup and JPMorgan and the second against, UBS, Barclays, RBS and MUFG Bank (formerly Bank of Tokyo-Mitsubishi). The press summary relating to those decisions is available here.
The European Commission found that in the period from 18 December 2007 to 31 January 2013 “some individual traders in charge of Forex spot trading of these currencies on behalf of the relevant banks exchanged sensitive information and trading plans, and occasionally coordinated their trading strategies through various online professional chatrooms”.
The commercially sensitive information exchanged by the banks in these chatrooms related to: outstanding customers' orders (i.e. the amount that a client wanted to exchange and the specific currencies involved, as well as indications on which client was involved in a transaction); bid-ask spreads (i.e. prices) applicable to specific transactions; their open risk positions (the currency they needed to sell or buy in order to convert their portfolios into their bank's currency); and other details of current or planned trading activities.
The information exchanges, following the tacit understanding reached by the participating traders, enabled them to make informed market decisions on whether to sell or buy the currencies they had in their portfolios and when.
Occasionally, these information exchanges also allowed the traders to identify opportunities for coordination, for example through a practice called “standing down” (whereby some traders would temporarily refrain from trading activity to avoid interfering with another trader within the chatroom).
The banks settled with the European Commission, thereby acknowledging their participation in the cartels. The periods during which the banks participated were as follows:
|Three Way Banana Split / Two and a half men/ Only Marge||UBS||10/10/2011||31/01/2013|
|Essex Express / Semi Grumpy Old men||UBS||14/12/2009||31/07/2012|
The claim is being brought in the UK’s Competition Appeal Tribunal (also known as the ‘CAT’). The Competition Appeal Tribunal is a specialist court based in London. It has cross-disciplinary expertise in law, economics, business and accountancy, and hears and decides cases involving competition or economic regulatory issues. The CAT publishes its Rules and Guidance, together with information about what it does, on its website: www.catribunal.org.uk.
Collective actions are a form of court procedure introduced to the UK by the Consumer Rights Act 2015, that enable a class representative to bring proceedings on behalf of numerous persons affected by an infringement of EU or UK competition law. Collective actions combine individual claims that raise the same, similar, or related issues of fact or law (known as ‘common issues’). The class representative will be responsible for running all aspects of the case before the Competition Appeal Tribunal, including those aspects for which claimants would normally be responsible.
Collective proceedings can be ‘opt-in’ (where each class member actively signs up to participate in the proceedings) or ‘opt-out’ (where each person within the class is automatically included in the proceedings unless they actively choose not to be).
Before a collective action can proceed, the Competition Appeal Tribunal must make a collective proceedings order (“CPO”) authorising the class representative and certifying the claims as eligible to be included in collective proceedings. When the CPO has been made, the matter progresses to a trial of the common issues (and determination of any individual issues) unless the case settles first. After success at trial or settlement, the damages are distributed amongst the class members using a distribution method approved by the Competition Appeal Tribunal.
This claim is on an opt-out basis for UK domiciled claimants. In due course, non-UK domiciled claimants must opt in, but in the meantime, can register their interest here.
See the ‘The Claim’ page for information about the proposed class representative, the specialist lawyers and experts it has instructed and the roles played in the litigation by all of these people.
The class representative has funding in place from Therium, a highly experienced global litigation funder, of over £29 million for its own costs. In addition, the class representative has obtained after-the-event insurance of £30.5 million to meet any adverse costs orders made against it. Class members are not required to pay any legal fees, nor do they run the risk of paying the defendants’ costs of defending the litigation.
The class representative has instructed Scott+Scott UK LLP as solicitors to act on behalf of the class. Scott+Scott UK LLP’s US affiliate, Scott+Scott Attorneys at Law LLP, instigated and is co-lead counsel in a class action in the US against sixteen banks for manipulation of the FX market in breach of US antitrust law. To date, in the US class action, settlement totaling over $2.3bn has been reached with fifteen of the sixteen banks.
If you are legally domiciled in the US, you cannot participate in this collective action as your claim is already being dealt with through the US class action (unless you elected to opt out).
For companies not domiciled in the US, FX trading through the US is similarly being dealt with by the US class action. However, for such companies, all your foreign exchange transactions which were priced or accepted in the European Economic Area can be included in the UK collective action.
For more information on the US class action settlement, see here.
Canada and Australia
There is also class action litigation in relation to anticompetitive conduct in the FX market in both Canada and Australia. To the extent that your FX trading is subject to either of these class actions, you will not be able to claim for that trading in the UK.
Over four months after the filing of Michael O’Higgins FX Class Representative Limited’s claim in July 2019, a subsequent CPO application was filed by Mr Phillip Evans in December 2019. Mr Evans seeks to represent broadly the same class bringing the same claim as the class representative. Under the Competition Appeal Tribunal Rules, where there is more than one applicant seeking to represent the class, the Tribunal must decide which would be more suitable and ultimately determine which (if either) of the claims should proceed (this process of selection is referred to in Canadian class actions as a “carriage dispute”). The Tribunal will hear the carriage dispute at the same time as the main certification hearing in July 2021. The class representative is confident that it will succeed in being selected by the Competition Appeal Tribunal in the carriage dispute.
Even if you have already registered your interest on the website for the CPO application by Mr Evans, there is nothing to prevent you from also registering your interest in this claim and you are encouraged to do so. Please register here to receive updates as this claim progresses.
The formal class definition is available here and should be read carefully.
In summary, if you are legally domiciled in the UK (on which see FAQ 10) and, between 18 December 2007 and 31 January 2013, you entered into a relevant foreign exchange transaction in the European Economic Area with a relevant financial institution or on an ECN, you will automatically be included in the class (unless you elect to opt out).
If you are legally domiciled outside of the UK, but otherwise meet the criteria above (for example, if you are a UCITS fund legally domiciled in Luxembourg or Ireland, a hedge fund legally domiciled in the Cayman Islands or the Channel Islands, or a multinational based in Germany or Italy, but you traded in London or elsewhere in Europe), you can actively opt in to the claim to seek to recover the losses which you suffered as a result of the banks’ wrongdoing. You can register your interest here. If you are in this category and do not opt in, you will not be able to get any compensation from the collective action.
For these purposes, a relevant foreign exchange transaction is, in summary, any foreign exchange spot or forward transaction involving two of the following currencies: Euro, British Pound, Japanese Yen, Swiss Franc, US Dollar, Canadian Dollar, Australian Dollar, New Zealand Dollar, Swedish Krona, Norwegian Krone, and Danish Krone. The transaction must have been priced and/or accepted in the European Economic Area.
Trades via contracts for differences (‘CFDs’) and spread betting are not included in the claim.
Although the Commission only found that Barclays, Citigroup, JPMorgan, RBS, UBS and MUFG Bank (formerly Bank of Tokyo-Mitsubishi) engaged in any wrongdoing, Michael O’Higgins FX Class Representative Limited believes the FX cartels had a wide effect on the market. For that reason, trades with all major market-making banks will be included in the claim. Market-making banks have been identified by reference to the Bank of England list of ‘reporting dealers’, which the Bank of England describes as institutions that “actively participate in local and global FX and derivatives markets” and participate in the Bank of International Settlements Triennial Survey of foreign exchange trading. For the complete list of relevant banks, see here. For the avoidance of doubt, the class representative does not allege that all of the banks on this list were involved in anticompetitive conduct, simply that the anticompetitive conduct by the banks named by the European Commission affected pricing by all these entities, even those not involved in any anticompetitive conduct.
The purpose of the claim is to recover losses suffered by the victims of the cartels. Accordingly, you cannot participate in the claim if you were an intermediary, engaged by another person to carry out a foreign exchange transaction on their behalf or otherwise for their benefit. Conversely, you can claim even if a broker, custodian or other intermediary traded on your behalf.
Finally, those included in the US, Canadian or Australian class actions cannot claim (unless they opted out of those claims) for the portion of their trading that is covered by those claims. It should be noted that the US class action encompasses all trading by US-domiciled companies unless they opted out; this does not however affect companies domiciled outside the US, which in principle can claim for all their foreign exchange transactions which were priced or accepted in the European Economic Area via the UK collective action. For more information on the US class action settlement, see here. For more information on the Canadian class action settlements, see here. For more information about the Australian class action, see here. You are also unable to claim if you are already involved in any other litigation relating to losses suffered as a result of the defendants’ anticompetitive conduct in the FX market.
Entities which fall within the class definition and are legally domiciled in the UK are automatically included in the class. For example, a company or limited liability partnership is domiciled in the UK if its registered office is in the UK.
Even if a business operates from the UK, it may not be UK domiciled (for example, a hedge fund which operates from London may be legally domiciled in the British Virgin Islands).
Entities which are not domiciled in the UK, other than in the US, Canada or Australia (see FAQ 7 above), but fall within the class definition can participate in the claim but must actively opt in. If you fall in this category, you can register your interest here, though you will have to opt in formally in due course. If you are in this category and do not opt in, you will not be able to get any compensation from the collective action.
No. It does not matter whether you (or your business) traded with the cartelist banks specifically. The combined market share of the cartelist banks leads the class representative to believe that the FX cartels affected the entire foreign exchange market, so trades with many other financial institutions will also have been affected. You will be included in the claim if you traded through the European Economic Area with any of the relevant listed banks or on an electronic platform (e.g. EBS, Reuters, HotSpot or Currenex). For a full list of the relevant banks, see here. For the avoidance of doubt, the proposed class representative does not allege that all of the banks on this list were involved in anticompetitive conduct, simply that the anticompetitive conduct by the banks named by the European Commission affected pricing by market-makers, even those not involved in any anticompetitive conduct.
Yes. The purpose of the claim is to recoup losses suffered by victims of the cartel. Where brokers, custodians and other intermediaries traded on behalf of clients, the loss will generally have been suffered by the client, not the intermediary.
Even if you traded through a prime broker or custodian bank, you will be included in the class as long as the FX transaction that your prime broker or custodian bank entered into for you was priced and/or accepted in the European Economic Area. Prime brokers or custodian banks trading on behalf of others will generally not be included in the class, save to the extent that they traded on their own behalf.
Yes. You will be a class member if you traded through an electronic platform, including single-bank platforms (such as Barclays’ ‘BARX’ or Deutsche Bank’s ‘Autobahn’), dealer-only platforms (such as EBS and Reuters) and multi-bank platforms (such as Currenex or Hotspot).
You will not be a class member if you traded contracts for differences (‘CFDs’) or spread betting products, for example through an online retail trading platform.
Spot and forward transactions are included within the class.
A ‘spot’ transaction is an agreement to exchange a specific amount of one currency against another, at an agreed rate, typically within two bank business days.
A ‘forward’ transaction (sometimes referred to as an ‘outright’ or an ‘outright forward’) is an agreement to exchange currency at an agreed rate on a specified value date usually more than two bank business days in the future.
Such transactions are likely to have taken place via voice or other direct trade, or via an electronic platform.
‘Voice or other direct trade’ includes trading over the phone, or other means of communicating directly with the bank (such as by Bloomberg chatroom).
‘Electronic platform’ (also known as ‘electronic communication network’ or ‘ECN’) includes single-bank platforms, such as Barclays’ ‘BARX’ or Deutsche Bank’s ‘Autobahn’, and multi-bank platforms such as HotSpot or Currenex.
However, the following do not count as ‘spot’ or ‘forward’ transactions for these purposes:
Branch retail spot transactions (e.g. foreign currency purchases at the “travel money” desk in a bank or the telephone/online equivalents);
Branch retail transfers of funds denominated in different currencies across any two accounts (whether effected in a bank, by telephone or online);
Electronic transactions using ATMs (“hole in the wall” cash machines);
Transactions executed in a foreign currency on a credit, debit, prepaid or stored value card; and
Swaps, options and futures are not included within the class, nor are contracts for differences (‘CFDs’).
The European Commission found that the cartels related to the Euro, British Pound, Japanese Yen, Swiss Franc, US Dollar, Canadian Dollar, Australian Dollar, New Zealand Dollar, Swedish Krona, Norwegian Krone (known as the ‘G10 currencies’) and the Danish Krone. The Decisions related to trading where both legs of the trade were from this list of 11 currencies, e.g. British Pound to Euro, or US Dollar to Japanese Yen.
In practice, the fact that there was manipulation on each of those eleven currencies is likely to mean that the pricing of other currencies was also affected and that a trade may be affected by the anticompetitive conduct even if it does not involve the currencies identified by the European Commission. However, the proposed class is for the time being restricted to transactions between two of the eleven identified currencies. In due course, it may become appropriate to expand the class in this regard to include further currency pairs.
No. These types of transactions are not ‘spot’ or ‘forward’ transactions for the relevant purposes – see FAQ 14 above.
No. Pension and investment funds which traded FX will have been victims of the FX cartel and UK domiciled pension and investment funds are members of the class (unless they opt out). Accordingly, if you have a pension or investment in a fund which traded FX, it may be a class member or potential opt-in class member, but you (as an individual) will not be. If you have any questions about this, these should be directed to your pension fund or investment fund directly.
Nothing. All costs (including all risk of future costs) are met by the class representative.
Before the Competition Appeal Tribunal will certify a collective action, it must be satisfied that the class representative has the financial resources to fund the claim and to pay the defendants’ costs if ordered to do so.
Michael O’Higgins FX Class Representative Limited is working with a specialist third party litigation funder, Therium Capital Management, to bring the claim. Therium is one of the longest-established litigation funders in the world, and has raised over $1bn in funding. It will provide over £29m of capital to fund the claim. In return for its investment, Therium will receive a fee. This is payable from any undistributed damages (damages not claimed by class members). Class members who do claim will therefore not be required to make any payment to any of the lawyers or funders involved in the case.
In addition to this, Michael O’Higgins FX Class Representative Limited has taken out after-the-event insurance to cover the defendants’ costs in the event that the claim is unsuccessful.
A summary of the funding and insurance arrangements is available here.
If you are a class member, you will be entitled to your share of the damages if the claim is successful at trial or the Competition Appeal Tribunal approves a settlement between the class representative and the banks.
The class representative will run the claim on your behalf so it will involve significantly less work to recover your losses than if you elect to opt out of the claim and seek to recover your losses on an individual basis. Unlike an individual claim, in an opt-out collective action you are not required to give disclosure or provide witness statements and will not need to take any active part in the litigation until such time as the proceeds of any settlement or judgment are being distributed.
Those not domiciled in the UK who opt in to the claim, are likely to be required to provide some evidence of their FX trading during the cartel period. This is unlikely to be as onerous as the disclosure obligations in an individual claim.
While the class representative will run the claim on your behalf, you will have the opportunity to contribute to the case as a class member. At certain points during the proceedings, class members can make submissions to the Competition Appeal Tribunal, and the class representative may engage in consultations with class members as the claim progresses.
The claim will be brought at no cost to you, and there is no risk of you being liable for the banks’ costs in the event that the claim is unsuccessful.
It is important to note that recovery of any money by way of the claim is not guaranteed. Even if Michael O’Higgins FX Class Representative Limited’s collective proceedings application is granted, the proposed class representative will still need to prove its case at trial, unless the defendant banks settle the claim.
The aggregate damages suffered by the class will be based on calculations carried out by experts. The experts will determine the difference between the price of all trades placed by class members which were artificially inflated as a result of the cartels, and the price which class members would have paid but for the banks’ manipulation of the market.
The sum of damages which you receive will be calculated individually by the claims administrator if settlement is reached or the claim is successful. If you are a member of the class, you should keep all records of your foreign exchange trades entered into between 18 December 2007 and 31 January 2013, and any other documents which you think may be relevant.
The legal process could take several years. It is possible that the case will settle without going to trial, in which case compensation could be available sooner.
An explanation of the experts’ approach to quantification of damages and methodologies is available here.
As with any litigation, there can be no guarantee of recovery. However, unlike in an individual action, in a collective action there is no cost to you and no risk that you will be ordered to pay the banks’ costs if the claim is unsuccessful.
There is no publicity or reputational risk for you in that individual class members would not ordinarily be named or identified publicly in the proceedings, without their express consent.
The defendant banks have settled with the European Commission, thereby admitting their wrongdoing. As the claim is a collective, opt-out action, class members would not be named individually. The class will comprise thousands of entities, and all UK domiciled entities will be included unless they opt out.
While we cannot speak for the banks, for these reasons (amongst others) it is highly unlikely that participating in the claim will compromise your business’s relationship with the banks.
Those domiciled in the UK do not have to do anything at this stage. If they have entered into relevant FX transactions, they are automatically included within the class.
Those who have entered into relevant FX transactions so that they otherwise fall within the class definition but are not UK domiciled (and are not covered by the US, Canadian or Australian class actions or any other individual litigation) can formally opt in to the claim in due course (and will be able to do so via this website in due course).
If the Competition Appeal Tribunal certifies the claim, more information will be published, including on this website. If you would like to receive updates when there are significant developments in the claim, register and tick the relevant box to receive more information. If you register your interest but elect not to receive updates, or you do not register your interest, you can check this website for updates and announcements.
When you register your interest, you can elect to receive updates about any substantive developments as the claim progresses. If you elect to receive only essential messages where action is required, you can still track the progress of the claim on this website, which will be updated periodically.
Yes – Michael O’Higgins FX Class Representative Limited intends to keep the list of those who register on the website confidential, sharing it only as necessary with those instructed to pursue the claim on its behalf (e.g. its lawyers and experts), subject to the following.
For the purposes of class certification, Michael O’Higgins FX Class Representative Limited anticipates providing the CAT and the proposed defendant banks with consolidated numbers of interested potential class members, and information as to the country of domicile of those outside the UK who might potentially opt in, but not the full list.
That said, Michael O’Higgins FX Class Representative Limited cannot entirely rule out the possibility that the CAT might order the identities of those who register their interest on the website to be disclosed at some stage. If that is proposed, Michael O’Higgins FX Class Representative Limited intends to ask the CAT to make any disclosure within a “confidentiality ring” to limit disclosure to the defendants’ external lawyers (and if necessary named in-house lawyers). In that way, the identities of persons who register on the website ought to be shielded from the business side of the banks, and also should not become publicly known. If the CAT is minded to order disclosure going beyond this, we will endeavour to contact you to give you the opportunity to de-register and remove your name from the list before the disclosure is made.
If this collective action is certified by the Competition Appeal Tribunal, information on how to opt in or out will be available via this website.
Any person with an interest (including any member of the proposed class) may object to the application for a collective proceedings order or the authorisation of Michael O’Higgins FX Class Representative Limited as class representative by writing to the Competition Appeal Tribunal stating their reason for objecting.
Any member of the proposed class may also seek permission to make oral observations at the collective proceedings order application hearing, by making an application for such permission, with reasons, as part of his/her written objections.
Any third party with a legitimate interest (who is not a member of the proposed class) can also apply to the Competition Appeal Tribunal for permission to make written and/or oral submissions at the collective proceedings order application hearing. Any such application must be made in writing, supported by reasons.
Any objection or application to make oral observations must be received by the Tribunal by 16:00 (BST) on 4 May 2021. Communications to the Competition Appeal Tribunal should include the reference “Case 1329/7/7/19 Michael O’Higgins FX Class Representative Limited v Barclays Bank PLC & Others” and be addressed to:
Competition Appeal Tribunal
Salisbury Square House
8 Salisbury Square
London EC4Y 8AP
Fax: +44 (0)20 7979 7978