The Court of Appeal ruling against the Fair Trading Commission (FTC) has placed the commission’s investigative practices under scrutiny, with growing questions over whether its leadership will now overhaul long-standing procedures that the court found fell short of the requirements of natural justice.

The judgment, delivered last Friday in the Supreme Ventures Limited matter, is expected to have implications far beyond a single case, with Jamaica Observer sources suggesting it could reshape how the FTC conducts investigations before issuing adverse public reports.

In its ruling the court ordered the FTC to reconsider its investigation into Supreme Ventures Limited (SVL), as it did not give the lottery company and its gaming subsidiary a fair opportunity to answer allegations that they had abused a dominant market position before issuing and publicly releasing adverse findings.

The court further held that procedural fairness is not a mere technicality. Rather, where a regulator publishes findings capable of causing significant reputational and commercial harm, fairness requires that affected parties understand the case against them and be afforded a meaningful opportunity to respond before conclusions are reached.

One of the judgment’s most significant findings concerns section 7(2) of the Fair Competition Act (FCA), which provides that the FTC shall hear an interested party who makes a written request and demonstrates that it is likely to be affected by an investigation.

The court also rejected the FTC’s argument that parties challenging its findings have no further right of appeal beyond a judge sitting in chambers, affirming that appeals may proceed to the Court of Appeal where appropriate.

The appellate judges also concluded that the FTC’s failure to adequately disclose the substance of the allegations effectively deprived the company of any meaningful opportunity to exercise that statutory right.

“This judgment goes to the core of regulatory fairness,” said one senior attorney who asked not to be named.

“It suggests that regulators cannot simply investigate behind closed doors, publish damaging findings and then expect the courts to sort everything out years later. Once an adverse public report is issued, reputational and commercial damage may already have occurred,” added the source.

The source told the Observer that the decision of the Appeal Court is likely to intensify calls for the FTC to review its investigative policies and internal procedures, particularly any long-standing practice regarding oral hearings and engagement with parties under investigation.

Attention is also expected to focus on whether the FTC board, which is chaired by Dr Nadeen Spence, will initiate governance or procedural reforms and whether the FTC’s parent ministry, the Ministry of Industry, Investment and Commerce will seek assurances that the entity’s investigative framework is fully aligned with the standards of fairness articulated by the court.

It is expected that the Court of Appeal ruling on procedural fairness will feature prominently in future litigation involving the FTC and may ultimately prompt the most significant review of its investigative practices since the FCA came into force.

The FTC is vested with wide powers to facilitate the effective discharge of its investigative mandate. Section 7 of the FCA confers on it broad investigatory powers for the discharge of its statutory functions. These include the authority to summon and examine witnesses, require the production of documents, administer oaths, and otherwise conduct inquiries and hearings necessary to determine whether the FCA has been contravened.

Upon completing an investigation, the FTC may pursue enforcement proceedings under section 46 of the FCA by applying to the Supreme Court, which is empowered to impose sanctions if it is satisfied that there has been a contravention of the FCA.

Additionally, section 49(1) of the FCA provides that any party aggrieved by the FTC’s findings may appeal to a judge in chambers.

The Appeal Court decision came as TW Metals Limited (Tank-Weld) continues its legal challenge against an FTC report into the local rebar market.

Earlier this year, the Supreme Court ordered that the FTC report against Tank-Weld not be acted upon, stayed all consequential proceedings and restrained its publication pending the determination of the appeal.