Way back in July 2017, I wrote that mining giant Glencore’s legal challenge to a £21 million offshore tax bill on its profits was likely to rumble on in the higher courts.

I turned out to be right.

The escalating dispute between the company and HMRC has now produced a judgment from the Court of Appeal which considers some of the key principles in commercial judicial review.

The judgment also holds some relevance for lawyers interested in public law, tax and commercial litigation.

You can download my free Q&A on this case, as published by LexisNexis.




It explains:

  • The background to HMRC’s relatively new power to recover ‘diverted profits tax’ under the Finance Act 2015;
  • The legal issues
  • What the Court of Appeal decided
  • Guidance on the when judicial review is an appropriate remedy
  • Unresolved issues specific to tax litigation
  • Key points for judicial review practitioners

Below are some nuggets that may interest you:

On the background

As part of UK government attempts to increase accountability of corporations who have used offshore arrangements to avoid paying tax, from 1 April 2015, HMRC was handed new powers in FA 2015 to prevent corporations based in the UK from hiding their profits offshore.

Since then, tax practitioners have waited patiently for the first reported cases on the operation of this new scheme. In the second half of 2017 three reported cases arrived, like London buses, in quick succession. Each arose from a single legal challenge brought by the mining multinational, Glencore, to a corporate tax bill of over £21m issued by HMRC under its powers in FA 2015.

Guidance on the when judicial review is an appropriate remedy

The court gives clear and highly readable guidance on the alternative remedy principle, uncluttered by the many authorities in this area (see paragraphs [55]–[56]). These are deliberately broad statements of principle which may be taken to apply to all public law proceedings (whether or not they are tax-related).

In summary, judicial review is a remedy of last resort whose purpose is to ensure respect for the rule of law where there is no other procedure to ensure that principle is respected. Even where there are alternative remedies, the court may exceptionally intervene before waiting for those alternative remedies to become available. That will be more appropriate where the alternative remedies provided by Parliament are not capable of addressing the unlawfulness complained of.

Where both judicial review and other statutory remedies are available

It is not uncommon for the High Court to stay judicial review proceedings in order for appeal procedures. Practitioners should be alive to the fact that the Administrative Court tends to be under considerable pressure in terms of its caseload and may be receptive to defendant applications to stay or even dismiss claims where another court or tribunal can address the substance of the claimant’s complaint. Practitioners should be prepared to respond to either of these scenarios.

You can find my earlier blogs on related judgments in this case here and here.

Posted by Ben Amunwa

Founder and editor of Lawmostly.com. Ben is a commercial and public law barrister with The 36 Group. He gives expert legal advice on employment, public law and commercial disputes to a wide range of clients.

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