Competition Law

🔍 Case Background

In early 2024, RegalChem Ltd., a mid-sized UK-based industrial chemical distributor, engaged South Spring Law Firm & Attorney after alleging that Nordex Industrial Solutions plc, a multinational competitor, had engaged in predatory pricing, exclusive dealing agreements, and abuse of dominant market position—all in violation of the UK’s Competition Act 1998, particularly under:

• Chapter II prohibition: Abuse of dominant position

• Chapter I prohibition: Anti-competitive agreements

Over a 14-month period, RegalChem experienced:

• A 47% drop in market share in the Southeast UK region

• Loss of three major clients due to Nordex’s exclusive supply tie-ins

• Price undercutting to below-cost levels that were economically unsustainable for any firm without state-level subsidies or market leverage

Despite raising concerns through letters and trade body complaints, RegalChem received no relief. Nordex’s growing influence created a de facto monopoly in multiple chemical verticals.

🧠 South Spring’s Legal Strategy

South Spring built an aggressive, multi-tiered legal approach that combined economic analysis, digital forensics, and international competition law precedent.

1. Initial Case Foundation & Market Impact Analysis

Victoria Langston, South Spring’s senior antitrust counsel, worked with UK economist Dr. Philip Hadley to:

• Define the relevant product and geographic markets

• Show Nordex’s dominance (58%+ market share regionally)

• Prove that RegalChem’s losses were directly traceable to Nordex’s conduct

This economic framework was vital to meeting the “appreciable effect” threshold required for a CAT competition claim.

2. Evidence of Predatory Pricing

South Spring’s litigation team subpoenaed internal emails and procurement contracts using the UK’s Disclosure Pilot Scheme. They uncovered:

• Direct evidence of Nordex pricing below cost for specific clients

• Internal communications acknowledging “sacrificial losses” to “eliminate the smaller ones”

• A pricing algorithm tool calibrated to respond instantly to RegalChem’s pricing offers

These revelations were central in proving intent to distort competition, a key factor in UK competition enforcement.

3. Exclusive Dealing Contracts

Through client testimonies and contract audits, the firm demonstrated that Nordex had entered into vertical agreements with distributors, including clauses preventing them from stocking RegalChem products—effectively foreclosing the market.

These agreements lacked justifiable efficiency defenses and had no pro-competitive offset, violating Article 101 TFEU principles (still enforceable in retained UK competition law post-Brexit).

4. Expedited Proceedings Before the CAT

Given the ongoing harm, South Spring sought interim relief and expedited proceedings. The CAT granted accelerated hearing status, citing risk of irreparable market distortion.

📣 The Trial

Over 8 days of hearings in September 2024, South Spring, supported by barrister Jonathan Ellis KC, presented a detailed case with:

• Witnesses from affected clients, confirming coercion and loss of supplier choice

• Economic modeling showing that no rational firm could sustain the pricing Nordex used without anti-competitive intent

• Regulatory comparisons from prior UK cases (e.g., Napp Pharmaceuticals Holdings Ltd. v. Director General of Fair Trading)

Nordex’s defense argued that their conduct was “robust competition” and that pricing was driven by scale efficiencies, not market abuse. However, under cross-examination, their CFO admitted that below-cost pricing was part of a strategic initiative targeting three specific competitors—RegalChem included.

🏁 Judgment & Outcome

In October 2024, the Competition Appeal Tribunal ruled in favor of RegalChem Ltd., holding that:

• Nordex had abused its dominant position in the market

• Their pricing strategy was anti-competitive, deliberate, and unlawful

• The exclusive dealing contracts were void and anti-competitive under Chapter I of the Competition Act

The CAT awarded:

• £7.5 million in damages to RegalChem for economic harm

• Full legal costs

• A permanent injunction preventing Nordex from enforcing exclusivity clauses for 5 years in the UK

✅ Outcome & Industry Impact

• RegalChem recovered substantial losses and reclaimed client confidence

• The ruling reinforced UK standards on fair pricing and vertical restraints, with post-Brexit independence from EU case law seen as supportive of domestic competition enforcement

• The UK’s Competition and Markets Authority (CMA) opened a follow-on investigation into Nordex’s market behavior across other industries

🗣️ Client Testimonial

“When we thought we’d be swallowed whole by a global giant, South Spring stepped in with intelligence, precision, and firepower. This win wasn’t just for us—it was for every independent business fighting to survive fair and square.”
— Paul Densmore, CEO, RegalChem Ltd.