Her Majesty's Revenue and Customs v Aimia Coalition Loyalty UK Limited (formerly known as Loyalty Management UK Limited) (No 2)

When the court issued its previous judgment on this appeal ([2013] UKSC 15), it allowed the parties an opportunity to make written submissions as to the form of the order to be made. The Commissioners then made submissions inviting the court to make a further reference to the Court of Justice of the European Union under article 267 of the Treaty on the Functioning of the European Union. LMUK made submissions opposing such a reference and inviting the court to dismiss the appeal.

Summarising matters developed at much greater length in the submissions, the Commissioners have put forward two principal arguments in favour of a further reference. First, they submit that a national court is obliged under EU law to make a further reference if it finds the ruling of the CJEU on the first reference to be incomplete or unsatisfactory. In support of that submission, they refer to the judgment in Wünsche Handelsgesellschaft GmbH & Co v Federal Republic of Germany (Case 69/85) [1986] ECR 947, in which the court said at para 15 that the authority of a preliminary ruling does not preclude the national court from properly taking the view that it is necessary to make a further reference before giving judgment. The court added that such a procedure may be justified when the national court encounters difficulties in understanding or applying the judgment, when it refers a fresh question of law to the court, or when it submits new considerations which might lead the court to give a different answer to a question submitted earlier.

Secondly, the Commissioners submit that there must be an issue of EU law raised in the present appeal on which a decision is necessary, and which cannot be considered to be acte clair, given the difference of view on the court.

In relation to the first point, LMUK point out correctly that the court did not in its earlier judgment question the European court’s ruling on any question of EU law. On the contrary, the court recognised the binding character of the European court’s judgment on questions as to the validity, meaning or effect of any EU instrument: see paras 56, 103 and 119. The court proceeded however on the basis of a more comprehensive consideration of the facts of the case than that set out in the reference to the European court: see for example paras 38, 40, 48 and 49. A different view of the facts from that on which the European court had based its ruling might of course necessitate a further reference in order to obtain further guidance, but it cannot be said that it would necessarily do so. On a different view of the facts, the difficulty which had led to the reference might no longer arise.

That was the position in the present case, in the view of the majority of the court. They considered that, with the benefit of hindsight, there had in reality been no need for a reference in the first place: see paras 30, 87 and 118. They noted that the European court had itself considered that the case raised no new point of law: see paras 34, 55, 87 and 118. They considered the judgment of the European court in order to identify the principles which it had applied to the incomplete account of the facts which it had been requested to consider: see for example para 56. They then applied the principles established by the case law of the European court to the more comprehensive account of the facts which, in their judgment, this court required to consider: see paras 73-75 and 78-82. On that view of the case, there is no question of EU law which now requires to be elucidated, and therefore no need for a further reference.

In relation to the second point, as I have explained the majority of the court considered that the case could be decided by applying well-established principles to the particular facts. They also noted, as I have mentioned, that the European court had dealt with the reference on the basis that it raised no new point of law. That was also acknowledged by the minority of the court: para 129. Although the minority of the court questioned the approach adopted in the majority judgments to the application of EU law and to the judgment of the European court, those criticisms were not accepted by the majority, and they are not regarded by the court as now requiring or justifying a further reference. In so far as the minority raised issues of fairness under domestic law, they raise no issue of European law suitable for the European court.

In the circumstances, including the European court’s own assessment that the case raised no new point of EU law, the court does not consider that a further reference to the European court is necessary. It would be unfortunate if the position were otherwise, bearing in mind that this litigation has already lasted since 2003.