Together with

Contents

• EDITOR’S RAMBLE 🗣

• TOGETHER WITH CLIFFORD CHANCE* 🤝

• FEATURED REPORT 📰

• STUFF THAT MIGHT HELP YOU 👌

EDITOR’S RAMBLE 🗣

I’ve got a quick favour to ask you.

My whole aim with LittleLaw is to help you land a vac scheme or training contract. But it’s been a long time (about seven years) since I was applying myself, and I don’t want to guess what you need.

So I’d rather ask you.

This short form asks where you’re at, what you’re stuck on, and what you’ve tried so far, including anything you’ve paid for (there’s a LOT out there, and I want to learn what’s actually helped, and what hasn’t).

It takes two minutes, and I read every answer myself. Whatever you tell me will shape how I make LittleLaw more useful for you ❤️

– Idin

TOGETHER WITH CLIFFORD CHANCE* 🤝

Could one presentation fast-track your Clifford Chance TC application?

Here’s your chance to find out.

The Challenge is Clifford Chance’s new immersive insight experience. You’ll work in teams tackling legal problems and business challenges for a fictional global client, using AI tools as things unfold.

Expect competing priorities, curveballs and direct access to Clifford Chance lawyers.

And standout performers could be fast-tracked to a Training Contract Assessment Day.

Here’s how it runs:

• 17 November: Virtual prep session

• 19 November: Live evening challenge at the firm’s London office (5PM–9PM)

• 20 November: Final team presentation at the firm’s London office (9AM–12PM)

Travel, meals and accommodation (if you’re coming from outside London) are covered – plus you get a £100 voucher.

🎓 Open to:

• Penultimate year law students at a UK or Irish university

• Final year non-law students at a UK or Irish university

⏳ Applications close 19 October (you’ve got 12 days left)

P.S. There’s a multi-stage application process, so apply in good time.

* This is sponsored content

FEATURED REPORT 📰

📡 How BT bought TalkTalk (but left its debts behind)

What’s going on here?

On Monday, BT (the UK’s biggest home internet provider) bought its rival TalkTalk (the fourth-biggest) out of administration.

BT hasn’t disclosed how much it paid for TalkTalk, but expects the overall rescue to cost it about £400 million this financial year.

That includes what BT paid for TalkTalk itself, the money needed to keep its businesses running after taking them over and about £100 million that TalkTalk owed Openreach, BT’s network business, which BT now won’t get back.

Why was it dangerous to let TalkTalk fail?

You could have lost your internet access or landline phone service if TalkTalk had collapsed – even if you weren’t actually a TalkTalk customer. That might sound odd, but it’s because TalkTalk had both a retail and a wholesale broadband business.

About 2.5 million customers depended on TalkTalk’s two businesses. A collapse could have disrupted services for both TalkTalk’s own customers and those of other providers.

Two things made a TalkTalk collapse especially dangerous.

🚨 Some customers relied on their phone line to call for help. TalkTalk had about 250,000 vulnerable customers – people who may need extra support because of their age, a disability or an illness. Thousands of these customers used telecare pendants (these are wearable alarms that use a phone line to call for help in an emergency). If the line stopped working, the alarm could fail to send the call.

🔍 It was hard to identify everyone who needed protection. PXC sometimes supplied one provider, which sold the service to another provider before it reached the customer. That chain made it difficult to know who depended on each line and who used an emergency alarm. So moving those customers to another network safely would have been harder.

How did BT buy TalkTalk without taking on its debts?

TalkTalk went into administration because it was struggling to pay its debts. But BT bought its retail business and its wholesale business, PXC, without becoming responsible for repaying the money TalkTalk had borrowed.

This is possible because a business and the company that owns it are two different things. Let’s take a bakery, for example.

The business is the operation that makes bread and sells it to customers. The company, let’s call it Bakery Ltd, is the legal organisation that owns the bakery, employs its staff and signs its contracts. If the company borrows money, it is responsible for paying it back.

There are two ways to buy the bakery (you might have heard of them). In a share sale, the buyer buys Bakery Ltd itself by buying all its shares. It gets the company and everything that comes with it, including the loans. In an asset sale, the buyer buys just the bakery business – the ovens, the shop and the staff – and the loans stay behind with Bakery Ltd.

TalkTalk’s sale used a mix of the two, called a hive-down.

The original TalkTalk companies can use the money raised by selling the retail business and PXC to pay administration costs and repay some of their debts. But there still might not be enough to repay everyone, and we don’t yet have a full breakdown of how much each creditor will get back.

The sale also used a pre-pack administration. That means the deal was negotiated before administrators were formally appointed, allowing them to complete it quickly after taking control. Our article on the Harvey Nichols sale explains that process in more detail.

Why could BT’s rescue be bad for customers?

Saving TalkTalk protected its customers from losing their internet access or phone service. But it could come at a cost to competition.

BT is already the UK’s biggest home internet provider and owns the Openreach network. So buying TalkTalk brings two competing home internet providers under the same ownership. It also gives the owner of Openreach control of PXC, another business supplying network services to other providers.

The Competition and Markets Authority (CMA) is investigating whether this could significantly weaken competition. Until the review ends, BT and TalkTalk are operating separately and still competing.

The CMA compares competition in the UK broadband market after BT’s takeover with what it could realistically have been without the deal.

Competition lawyers call the situation without the takeover the counterfactual. To work out what that could have looked like for a business struggling to pay its debts, such as TalkTalk, the CMA’s guidelines focus on two questions.

1. 📉 Would TalkTalk have had to stop operating without BT’s takeover? The CMA needs to examine whether TalkTalk could have found funding or reorganised its finances to keep running. If it would have stopped operating, customers could have lost TalkTalk as an option even without BT buying it.

2. 🤝 Could another buyer have kept the businesses running independently? The CMA needs to examine whether another proposed purchase could actually have worked and preserved more competition. If another buyer could have kept TalkTalk competing with BT, BT’s takeover could remove an alternative that customers would otherwise still have had.

Could another buyer have rescued TalkTalk?

Opus Broadband, a UK broadband provider, says it had an offer for TalkTalk’s retail business that was still open and had not been rejected. Also, Epiris, an investment firm, had been trying to buy PXC.

Working out whether these purchases could have succeeded means looking at two practical issues.

🌐 Firstly, the retail and wholesale businesses needed to keep working together. TalkTalk’s retail business relied on PXC’s network services to deliver internet access and phone services to its customers. Buying both businesses kept them under the same owner. Selling them to different buyers could still have worked, but those buyers would need arrangements for PXC to keep supplying the retail business. The CMA will need to examine whether the alternative buyers could have secured those supply arrangements.

💷 Secondly, Epiris’s proposed rescue still involved asking BT for help. PXC supplies network services to other internet providers, but it also needs access to infrastructure supplied by Openreach to keep customers connected. Openreach is owned by BT – and TalkTalk owed it the £100 million mentioned earlier for those services.

When Epiris was trying to buy PXC, it reportedly asked BT to waive about £300 million of payments due to Openreach to help its rescue plan work. BT refused the request, and Epiris’s purchase didn’t go ahead. BT then bought both businesses itself.

This doesn’t mean BT did anything wrong, or prove that BT’s refusal prevented Epiris’s purchase. But it helps explain why the CMA needs to examine whether that alternative rescue could realistically have worked.

What happens after the CMA publishes its report?

Once the CMA delivers its report, the government and Ofcom each have a role in what happens next.

⚖️ The government weighs competition against the wider public interest. Culture Secretary Lisa Nandy must accept what the CMA finds about competition. If it finds that the takeover would weaken competition, she then considers whether the benefits of keeping vulnerable customers and essential services connected outweigh that harm. She can let BT keep the businesses, allow the takeover subject to legally binding promises to address the concerns, or send it to the CMA for a deeper investigation. That investigation could eventually lead to BT having to sell some or all of the businesses it bought, even though it has already completed the purchase.

📡 Ofcom checks that BT keeps following telecoms rules. Ofcom, the UK’s telecoms regulator, has said it will monitor the takeover to make sure customers are protected. The rules BT must follow exist to protect customers, keep networks secure and ensure other providers can use Openreach’s network on fair terms. The regulator can investigate and take action if the rules are broken.

Which law firms were involved?

Clifford Chance advised BT. DLA Piper and Freshfields advised TalkTalk, with Freshfields covering several areas, including competition law.

How can you use this in your applications?

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