The Competition Appeal Tribunal (CAT) has held that confidentiality under litigation privilege applies to Competition Act investigations, in a key ruling in the Office of Fair Trading's (OFT's) long-running investigation into dairy retail pricing.

The ruling comes after an application by the OFT to make use of Tesco's records of interviews with potential witnesses for its investigation.

Freshfields Bruckhaus Deringer has been acting for Tesco, with a team led by litigation partner Paul Lomas and competition partner Deirdre Trapp alongside senior associate Dan Burton.

Dinah Rose QC of Blackstone Chambers and Brick Court Chambers' Maya Lester and Daniel Piccinin have been instructed as counsel.

Stephen Morris QC and Josephine Davies of 20 Essex Street are representing the OFT alongside Monckton Chambers' Kassie Smith.

Litigation privilege – confidentiality for lawyers, clients and third parties in ongoing litigation – is usually only applicable in adversarial proceedings. The CAT's ruling addressed the application of litigation privilege in Competition Act investigations, which the OFT had argued did not apply.

The tribunal ruled that the investigation is no less adversarial than civil litigation in part because the OFT had already issued its Statement of Objections – a statement outlining the breaches it believed Tesco to have made.

The case is understood to be the first time there has been judicial discussion of the application of litigation privilege in a Competition Act investigation.

The dairy pricing investigation dates back to 2002, when the OFT issued an infringement decision in which it found that certain supermarkets and cheese processors had breached competition law through price fixing. The regulator handed out fines totalling almost £50m in 2011 including a £10m penalty for Tesco.

Tesco subsequently appealed the decision, with yesterday's ruling marking the first step before the official appeal begins on 26 April this year. No other party has appealed.