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Glencore Energy UK v HMRC – Court of Appeal decision

Glencore Energy UK v HMRC – Court of Appeal decision

The Court of Appeal has confirmed that judicial review is not available when the statutory route of appeal is not exhausted.


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In Glencore Energy UK v HMRC [2017] EWHC 1476, Glencore sought judicial review of a charging notice issued under the Diverted Profits Tax (DPT) regime FA 2015 s 95. The High Court had found that judicial review was not an available remedy to contest the validity of a charging notice, as there is still the opportunity to use the statutory appeal mechanism. The taxpayer challenged the High Court decision in the Court of Appeal, seeking a quashing order and the return of the money paid, amounting to £21 million. In its decision, published on 2 November 2017, the Court of Appeal has dismissed Glencore’s application for judicial review on the grounds that a suitable alternative remedy is available in the form of the statutory review under section 101 FA 2015 in conjunction with the right of appeal to the FTT under section 102 FA 2015.

Main submissions

The taxpayer’s main submission (as in the High Court) was that the statutory review procedure was not an adequate alternative remedy where the charging notice issued by HMRC did not comply with the statutory requirements (i.e., in the taxpayer’s view, it was invalid).

The taxpayer submitted that the statutory review procedure could not comprise an adequate alternative remedy on the basis that:

  • The statutory review does not involve independent scrutiny;
  • HMRC holds the tax throughout the statutory review period prior to the taxpayer’s right to appeal to the independent tax tribunal arising; and 
  • The tax tribunal could not in any event deal with issues where there were public law errors in issuing the notice.

What is a suitable remedy?

In its discussion, the Court of Appeal stated that it is not in doubt that judicial review should be used as a remedy of last resort, when there is no suitable alternative remedy available. Judicial review cannot be used to disrupt the smooth operation of statutory procedures which may be adequate to meet the justice of the case and it ensures the courts give priority to statutory procedures as laid down by Parliament, respecting Parliament’s judgment about what procedures are appropriate for particular contexts.

On the other hand, speaking of the statutory appeal procedure, the Court said that Parliament has introduced the mandatory review under section 101 with a legitimate objective in view, to encourage the taxpayer to engage with HMRC to seek to agree what may well be complex aspects of the counterfactual scenario to be addressed under Part 3 of FA 2015 in circumstances where there may well be more relevant information held by the taxpayer than will initially be known to HMRC.

It was held that the relevant alternative remedy in this context is not a review by itself, but a review in conjunction with a right of appeal at the end of it. The right of appeal is not limited in any way and there is no unfairness to the taxpayer in requiring the review process to be gone through before an appeal is brought.

You can see the full decision here.

For further information please contact:

Suzie Moore

Konstantina Stettner

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