TPR Anti-Avoidance Hearing Heads to Upper Tribunal for First Time

The UK’s The Pensions Regulator (TPR) said a pending lawsuit, in which it is trying to force broadcaster ITV to fund a pension plan, will be heard by the Upper Tribunal in early 2018. It will be the first time an anti-avoidance case by TPR has been heard in full in the Upper Tribunal.

TPR is seeking the court’s help in forcing ITV to pay contributions to close a £90 million ($115.4 million) deficit in the Box Clever Group Pension Scheme.

In December 2011, TPR’s Determinations Panel issued a financial support direction (FSD) to ITV, which then referred the decision to the Upper Tribunal in January 2012. But since then, TPR said, it has been fighting various legal challenges brought by ITV, which has prevented the case from being heard, until now.

“We have fought at every stage to bring our case for an FSD and are pleased the courts have agreed with our position,” said Mike Birch, TPR’s director of case management. “This sends a clear message that we will not shy away from pursuing regulatory action to protect workplace pensions.”

Box Clever was formed in 2000 after a merger between the TV rental businesses of Granada (now ITV) and Thorn (now Carmelite). TPR opened an anti-avoidance investigation following the collapse of Box Clever. Respective employees were transferred to the new company and enrolled in the Box Clever pension plan, which was created to ensure that those members would continue to receive the same benefits as promised in their former plans. Today, the plan, which has approximately 2,800 members, has a buy-out deficit of more than £90 million, according to TRP.

ITV originally went to the Upper Tribunal in January 2012 to challenge TPR’s determination to issue an FSD.  The broadcaster began its challenge of TPR’s ability to submit additional evidence in late 2013. Several hearings followed, including an appeal to the Court of Appeal, before the Upper Tribunal ruled in favor of TPR in 2016. ITV then made subsequent requests for permission to appeal, with the most recent being refused in late July. The Court of Appeal refused permission for ITV to appeal against a ruling made in TPR’s favor to allow the introduction of new evidence in its anti-avoidance case against the broadcaster.

TRP said it is the fourth time the courts have considered these issues and sided with the regulator.

“[The] Appellants fail to advance any argument…which would entitle this Court to interfere,” said the judge, the Rt Hon Lady Justice Arden, in her ruling. Arden said TPR is not bound by the case it put before the determinations panel, and is entitled to raise matters not previously raised where a determination is referred to the Upper Tribunal.

“It is vital for us to be able to introduce new evidence where appropriate when we are pursuing anti-avoidance and so we welcome this latest important ruling,” said Birch. “The ruling also brings closer the prospect of greater certainty for members of the Box Clever Group Pension Scheme, which due to legal challenges by ITV has been delayed for six years.”

The Upper Tribunal hearing examining TPR’s decision to issue a FSD is scheduled to start January 29, 2018, and is expected to last for two weeks.