On 25 May 2022 the Supreme Court handed down its judgment in Pfizer and Flynn v CMA  UKSC 14, reinstating the Competition Appeal Tribunal's ("CAT's") decision to award Pfizer and Flynn costs arising from their successful appeal against the decision by the Competition and Markets Authority ("CMA") which found that Pfizer and Flynn had abused their dominant position in relation to the supply of epilepsy medication.
The Supreme Court held that there is no generally applicable principle that public bodies should have protected status in circumstances where they lose a case brought or defended in the exercise of their public functions in the public interest. Rather, it is important that a court or tribunal considers the risk that there will be a 'chilling effect' on the conduct of the public body, if costs orders are made routinely against it in similar proceedings.
Specifically, the Supreme Court held that the prospect of adverse costs orders in competition law infringement appeals had no real risk of ‘chilling’ the CMA’s enforcement activities, given that the CMA can offset a costs order against income received from fines for competition law infringements and, also, that adverse costs orders imposed an important discipline on the CMA’s activities. The Supreme Court also upheld the CAT’s long-standing practice in competition law infringement appeals of applying ‘costs follow the event’ as a starting point.