Richard Bruton (Dublin North Central, Fine Gael) | Oireachtas source

Most countries have looked at the grocery sector and found that it has problems that are particular to it because of the presence of very substantial retailers relative to pretty small players on the supply side in some cases. We have ensured it will also apply to relatively small retailers which might have supply chain problems with very large distributors.

Senator Barrett is right in saying this is not an industry in which there are large barriers to entry, but that is not the only test of competition and it never has been. There is also the issue of abuse of dominance and whether it is easy to pursue cases of dominance. Previous competition law recognised that by banning so-called hello money because it was not consistent with a proper approach.

While there are broad principles of competition law, which are set out in European treaties and reflected in our law, there are cases when, based on the operation of a particular market, it is necessary to introduce other protections. If the Senator looked through the sections - I do not know if he bothered to read the ten pages he found so irksome - he would find they cover issues such as what happens when the forecast of supply of goods is wrong and how the cost of that is shared out. Who pays for the cost of a discount promotion in a grocery store? How is that fairly worked out? We are seeking to ensure there are written contracts and these matters are handled fairly. Most large grocers, particularly ones that operate in other jurisdictions - Aldi and Lidl in particular have come in from other jurisdictions - are used to operating these sorts of rules in respect of reasonable contracts for their suppliers. This is not something really cumbersome and irksome for many of them. The same would be true of Tesco.

They provide, as they have done in the UK and other markets, a fair approach to handling things that are pretty unique to groceries, such as shrinkage, wastage, losses and so on. I am not trying to pretend I have anything like the knowledge Senator Quinn has of the sector, but while it is competitive in many ways and people do shop around, we need to ensure the rules are fairly applied because there are large players in this sector. Other countries have taken this approach.

I turn to Senator Darragh O'Brien's point.

The original approach developed by Mr. John Travers was to have a code of practice and an ombudsman. As the Senator knows, a code of practice is essentially voluntary and an ombudsman makes recommendations which one then hopes people will act upon. We have taken the view that the voluntary approach did not work so we are introducing regulations with legal force and with criminal sanctions. We are using the Competition Authority not as an ombudsman, but as an enforcer. It is a not a body which will weigh arguments and make a recommendation that does not have the force of law behind it. This will be a set of regulations that will have the force of law which we will expect to see reflected. Where the regulations are not abided to, there will be the opportunity to enforce them. There will also be other measures available, such as the possibility that the Competition Authority would issue a compliance notice so that if an action was inadvertent or a first-time misdemeanour, there might be no action beyond the compliance notice. If a party refused to act on a compliance notice, an enforceable instrument would be used.

The debate about the ombudsman has passed. It was an alternative approach involving codes, an ombudsman and a voluntary arrangement. It was assumed that everybody would be a good scout and play by the rules but it did not prove possible to achieve that kind of approach. This approach would use the Competition Authority, as it regulates every other sector and it has intimate knowledge of fair practice in the market. It has enforcement powers and legal, economic and other machinery to do this right. It would make no sense for us to set up a new quango to do what we can now with the joining of two agencies. The Senator's amendment would not add to the Bill. I have spent most of my life on the Senator's side of the House and I know a charge cannot be introduced on the Exchequer either.