The Damages-Based Agreements Reform Project Drafting And Policy Issues

The proposed reforms will generate particular interest in competition law; proposing to ban DBAs for all collective proceedings before the Competition Tribunal (CAT) and not just with regard to opt-out procedures, as is currently the case. Following the presentation of the supplementary report by Rachael Mulheron and Nick Bacon in September, the MoJ will decide on the next steps. It is hoped that the current proposals for reform of the DBA with greater enthusiasm and more measures on the part of the government will be repeated than previous attempts at reform. The new compensation agreements proposed in 2019 would move to a “success fee model” of the DBA, allow “hybrid” agreements, include specific termination provisions and explicitly allow defendants to use DBA. Of course, it would not be surprising if the reform of the DBA was not at the top of the government`s agenda, as it addressed the issues of COVID 19 and Brexit, so it is likely, on all bases, that there will be some delay before the problems posed by the DBA regulations are finally addressed. Personally, I hope 2021 (with regard to the reform of the DBA and in many other areas, after the general sinking and darkness that have been so far in 2020). The next opportunity for reform was the review of the legislation by the MoJ after the implementation of the DBAs, part 2 of the Legal Aid, Sentencing and Punishment of Offenders Act 2012 (LASPO). In its February 2019 report, moJ agreed that DBA regulations should be provided with additional clarity and security. It stated that it would carefully consider the procedure to be followed in light of the results of an independent review of the development of the DBA regulations conducted by Professor Mulheron and Nicholas Bacon QC.

While the DBA reforms include a series of major regulatory revisions, the next one focuses on some of the most important changes to the impact on the regime. These draft DBA regulations of 2019 do not claim to be the last word in this complex and controversial area of civil justice. On the contrary, it is to be hoped that the text will move the issue forward by addressing the key issues that have arisen under the 2013 DBA regulations, by providing an opportunity to provide feedback and then by addressing the conference on Thursday 17 October; and through further consultations, if the government wishes to move the issue forward by implementing a new version of the damage-based agreements. Stuart Carson writes in Competition Law Insight about criticizing the new DBA rules and explains why the issues they have raised need to be addressed and why law firms probably don`t go far to offer DBAs to their clients.

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