Ms Isolde Goggin:

I thank the Chairman. I am going to start by addressing Deputy Cahill's question about what is large enough and whether size matters. I might ask Mr. O'Leary to deal with the questions about the cartel. This is a genius question because it goes to the core of competition law and the difference I spoke about between vertical and horizontal agreements. Size does not matter in a cartel. All cartels are illegal. Any kind of cartel is a criminal offence and it does not matter whether it is big or small. In vertical agreements one looks at the effect of the agreement. When looking at competition law, it always says that agreements which have the object or effect of preventing, restricting or distorting competition are illegal. It is about object or effect. Cartels are object restrictions, as we call them, so they are always illegal regardless of how small they are or if a person says he or she did not mean to do it. They are always illegal.

Regarding agreements which have an anti-competitive effect, vertical agreements are generally considered not to have an anti-competitive effect until they go above a certain market share threshold. They are generally efficiency enhancing. They make it more efficient for the producer and the supplier. There is more certainty because there is a contract, and that is a big issue as well because it tries to iron out some of the volatility. That is where the European Commission has what is called a safe harbour in its vertical block exemption regulation, Regulation No 320/2010. If the market share of the upstream and downstream, the producer and supplier, are both below 30%, then it is okay, and in that case size does matter. Agreements that cover a lesser part of the market are generally not considered to be a problem, unless there were three or four agreements that sewed up the entire market and nobody could come in at either level. Many people spend their time looking at the effects of those kinds of vertical agreements. Looking at the statistics in the Twenty20 Beef Club, if all the predictions and market share forecasts came true, they might get up to 5% in a few years, and that is not a level that would trigger our concerns.