Dara Calleary (Mayo, Fianna Fail) | Oireachtas source

The proposed amendment to section 130 relates to the renewal of subscription contracts. The purpose of the amendment is to make it an unfair term in a consumer contract to charge consumers who are renewing their subscription a higher fee than consumers who are new subscribers. This ties in with the previous amendments. These issues were raised during the Dáil debates. Along with departmental officials, my predecessor, Deputy Troy, as he committed to, did much work in this space over the summer recess to ensure it could be done in a legally sound way. Officials engaged with a number of stakeholders to discuss the feasibility of doing that. I inherited that work and I wrote to Deputy Sherlock on the findings relating to it.

A number of insights emanated from that exercise. Most subscription contracts are in heavily regulated sectors such as utilities and telecoms. The relevant regulators in those sectors already have powers to intervene to protect consumer rights. For example, in September the Commission for the Regulation of Utilities, CRU, published a suite of additional protections for customers that energy suppliers must implement. This means that energy suppliers will be required to publish their retention offers, including relevant discounts, on their websites from December next. Suppliers will also be obliged to provide this information to customers who call their customer care lines about their contracts. This is similar to the previous amendment. Abiding by these rules is a licensing condition and the CRU can take action including revocation of licence and administrative sanctions for non-compliance.

Arising from the work, we have ascertained there is a risk that inserting an amendment of this nature into the Consumer Rights Bill could result in negative, unintended consequences on fair competition in the marketplace. The prohibition of businesses using the long-standing practice of introductory offers for new customers unless they, in parallel, made the same offer to existing customers could do damage. As a consequence, there would be little benefit to shopping around and consumers who look for value on a regular basis may be inadvertently disadvantaged.

The CCPC is undertaking research into pricing practices across 12 different sectors and it intends to publish a report towards the end of this year. The findings of this report will be important in informing policy in this area. I advise prudence in awaiting the recommendations emanating from that research before making any substantive policy or legislative changes in this area.

Arising from the work completed over the summer, it remains unclear if legislating in this area would be an effective route. Such aspects would require further consideration. Even if we were to agree a policy in this space, there would be difficulties in legislating using the architecture of the Consumer Rights Bill for an amendment seeking to restrict the pricing practices of service providers.

We have done the preliminary work and more work needs to be done. However, we want to progress this legislation. I will keep pressure on the CCPC arising from the work my officials completed over the summer. I will certainly be keeping a sharp eye on this space. Unfortunately, I cannot accept the amendment.