Oireachtas Joint and Select Committees

Tuesday, 16 July 2013

Joint Oireachtas Committee on Agriculture, Food and the Marine

Groceries Sector: Discussion with the Competition Authority and the National Consumer Agency

2:15 pm

Photo of Thomas PringleThomas Pringle (Donegal South West, Independent) | Oireachtas source

I thank the witnesses for their presentations today. In her submission, Ms Goggins stated that there were two elements of the 2006 Act that deal with the retail sector. She stated that it only applied if there was an anti-competitive object as part of those. My view is that it would be quite limited in terms of the questions being asked of the retail multiples by committee members over the last few months. I presume somebody can ask for a supplier to contribute to the cost of a promotion that would not necessarily be anti-competitive. The supplier is supplying that person and is not excluding anybody else. While it may be illegal, it may not be illegal under the 2006 Act. I would like Ms Goggins to expand on that. When they were here, the representatives of the multiples were very strong in stating that the 2006 Act provides a mechanism for anybody who wants to make a complaint or raise an issue about any illegal practices that may be going on within their businesses. Lo and behold, nobody has made a complaint so everybody is very happy with what is happening. From looking at the presentation, it seems quite limited in what could be examined by the Competition Authority. Perhaps Ms Goggins could expand on that.

Ms Goggins also states that codes of practice are not always fit for purpose and do not solve the problems they were intended to solve. Are there examples of codes of practice that are fit for purpose and codes that have failed as well? That would be interesting for the committee's work. Ms Goggins also states that the code of practice would impose significant compliance costs. The representatives of the retail multiples in here over the last few months spoke very eloquently about how compliant they are and how much they spend on being compliant as things stand. It was very difficult to get an idea from them as to where this extra cost would come from. If they are already so compliant, it seems that there would not be significant extra costs in complying with a code of practice if it was brought in. They failed to my satisfaction to give concrete details of what these compliance costs would be and how they would impact on their business. Perhaps the Competition Authority might have some knowledge on that.

My next question is for the Competition Authority again. One of the issues that has come up in this committee is the price that primary suppliers are paid by creameries and the price paid in the supermarket for liquid milk. Would it be anti-competitive to set a minimum price for the primary producer of a commodity or a product? Would there be competition law problems with that if it was decided it was in the common good to have a level price for a product made by a producer?

My final question is for the National Consumer Agency.

Food costs in Ireland are 18% higher than the average across the European Union. The multiples said this is due to the increased cost of doing business in Ireland but did not really elaborate on that. Can the witnesses say, based on their own research whether that 18% differential is justified in the context of costs across Europe and other countries? Do they accept that the 18% difference is justified?

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