Written Answers. - Retail Sector Regulation.

Wednesday, 24 March 1999

Dáil Éireann Debate
Vol. 502 No. 4

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  75.  Mr. Callely  Information on Ivor Callely  Zoom on Ivor Callely   asked the Tánaiste  Information on Mary Harney  Zoom on Mary Harney   and Minister for Enterprise, Trade and Employment if she has satisfied herself that the Groceries Order, 1987, and the Competition Acts, 1991 and 1996, are adequate to meet the market place demands; and if she will make a statement on the matter. [8465/99]

Tánaiste and Minister for Enterprise, Trade and Employment (Ms Harney): Information on Mary Harney  Zoom on Mary Harney  The Competition Act 1991 based by analogy on Articles 85 and 86 of the Treaty of Rome, prohibits anti-competitive activity in the economy. Specifically it prohibits anti-competitive practices and the abuse of a dominant position.

The Act applies to undertakings, an undertaking being defined as an individual, a body corporate or an unincorporated body of persons engaged for gain in the production, supply or distribution of goods or the provision of a service.

Section 4 prohibits and makes void all agreements between undertakings, decisions by associations of undertakings and concerted practices which have as their object or effect the prevention, restriction or distortion of competition in trade in any goods or services in the State or in any part of the State.

[1054] Section 5 prohibits any abuse of a dominant position.

Section 6 provides that any person aggrieved as a consequence of anti-competitive activity has a right of action in the courts for relief, by way of injunction or declaration and damages, including exemplary damages.

The Competition (Amendment) Act, 1996 was enacted to strengthen the body of legislation in the competition area by two important provisions. The 1996 Act contains offences, both civil and criminal, and penalties provisions for breaches of the rules of competition as set out in the 1991 Act. In addition, it provides for public enforcement of the rules of competition. A Director of Competition Enforcement with wide powers was appointed in order to give effect to the public enforcement provisions.

As a result, therefore, of the enactment of the Competition (Amendment) Act, 1996 there are now two alternative ways of pursuing allegations of breaches of competition rules: (i) take civil action under section 6 of the Competition Act, 1991, or, (ii) make a complaint to the Director of Competition Enforcement requesting him to investigate the alleged breach(s).

The Restrictive Practices (Groceries) Order, 1987, covers all grocery goods, with the exception of fresh fruit, fresh vegetables, fresh and frozen meat, and fish, as well as intoxicating liquor and other household goods ordinarily sold in grocery shops. The Groceries Order prohibits practices such as below cost selling and advertising, boycotting, and hello money, and provides for controls on terms and conditions of supply. The Order is enforced by the Director of Consumer Affairs.

It was intended that the old Restrictive Practices Act and Orders made thereunder would be revoked when the Competition Act, 1991 came into effect. However, the Groceries Order was retained after lobbying from the retail grocery sector and the industry.

While consumers have been well served by our legislation in this area, I am open to suggestions and recommendations for improvement to the benefit of consumers.

To this end, the competition and mergers review group is currently reviewing the position of the Groceries Order as part of its overall work. Its terms of reference are to review and make recommendations on the mergers legislation in the context of a legislative consolidation; the effectiveness of competition legislation and associated regulations; cultural matters in the context of the 1991 Act and in particular section 4(2) of that Act; and appropriate structures for implementing the above legislation.

I expect to receive the report and recommendations of the review group this year.

[1055]

  78.  Mrs. Owen  Information on Nora Owen  Zoom on Nora Owen   asked the Tánaiste  Information on Mary Harney  Zoom on Mary Harney   and Minister for Enterprise, Trade and Employment if she will clarify the position whereby supermarkets require suppliers to pay extra for bonus points schemes where products are specially promoted; and if she will make a statement on the matter. [8468/99]

Minister of State at the Department of Enterprise, Trade and Employment (Mr. T. Kitt): Any allegations that commercial arrangements exist which may be in contravention of the Restrictive Practices (Groceries) Order, 1987, should be drawn immediately to the attention of the Director of Consumer Affairs who is responsible for enforcing the order and whose job includes advising business in this regard.

Precise details of any arrangement, including suppliers paying extra for bonus points schemes where products are specially promoted, would need to be examined in detail by the director to determine the position.


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