Mr. Niall Cody:

I assure the Chairman that we dedicate significant resources to tackling these sectors. We are very serious about what we do. I referred earlier to our report on the oil market. We are sometimes reluctant to become involved in measuring the level of the shadow economy because one can never say what is that level. If one could do so, obviously one would be aware of the areas in which illicit activity was taking place. In the context of the study we conducted in respect of the oil market, we are continuing to invest significant resources and to develop new technologies. The Chairman is correct: as the process moves on, countermeasures are being taken. A significant proportion of the 2,000 staff involved in compliance activity are involved in tackling the shadow economy. The Chairman is also correct to state that sometimes we do not offer a sufficient explanation with regard to what we are doing.

Margins are very tight. The margins on petrol and diesel are 3% to 4%. As a result, the temptation is very strong. We refer to risk. We see that to which I refer as being at the very top of our risk tree and we devote significant resources into tackling the hard end of it. We work closely with the Garda because a great deal of what we are discussing here is mere criminality - it just happens to be the vehicle by means of which those involved in these activities make money. We also work closely with our international colleagues, including those at OLAF, regarding the smuggling of cigarettes. We will, however, continue to face a significant challenge because it is done-----