Seanad debates

Tuesday, 15 July 2014

Competition and Consumer Protection Bill 2014: Report and Final Stages

 

1:55 pm

Photo of Denis O'DonovanDenis O'Donovan (Fianna Fail)
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I remind Senators that they may speak only once on Report Stage, except that the proposer of an amendment who may reply to the discussion on such amendment. Each amendment on Report Stage must be seconded.

Photo of Trevor Ó ClochartaighTrevor Ó Clochartaigh (Sinn Fein)
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I move amendment No. 1:


In page 55, line 11, to delete "prevalent" and substitute "present".
I welcome the Minister, Deputy Richard Bruton, back to the Seanad. We were all wondering this morning which Ministers might attend the various debates.
One might say it is a case of nitpicking to choose the word "prevalent" over "present", but it is an important distinction to make. It is interesting to look at the definition of "prevalent". One of the dictionaries I consulted included the definition "having the superiority or ascendancy". I am sure there might be legal connotations to the word "prevalent" as opposed to "present". What is at issue is the diversity of content in media. We all share concerns, including the Minister, about the convergence of media. I have even heard stories in the local media about more mergers and more local radio and television stations being taken over by larger companies. We find that a number of players are taking over the media industry. Diversity of content is extremely important in the circumstances, which is why we believe it would be better to refer to the broad diversity of views, including views on news, current affairs and cultural interests, that is "present". It would copperfasten the concerns of smaller groups in society, including those who believe they do not receive recognition.
There was an interesting petition before the Joint Committee on Public Service Oversight and Petitions on an issue like this. I understand RTE is considering conducting its own diversity consultation process on how it should approach the issue as a national broadcaster. It might seem like a small amendment to make, but it would have far-reaching ramifications. We are all aware of how diverse Irish culture has become in recent years. If media moguls need only take cognisance of the prevalent cultural interest, they will take notice only of the superior or ascendant views, which are the views of those in power and the majority. That is not acceptable. Therefore, I ask that this minor amendment be taken on board in the spirit in which it is put forward to ensure we would have full diversity in the media and would not exclude minority groups in the definition of "diversity of content".

Photo of Darragh O'BrienDarragh O'Brien (Fianna Fail)
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I second the amendment.

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)
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We debated this proposal in the other House and on Committee Stage here. It goes back to the recommendations of the mergers group which clearly used the term "prevalent". This is about defining "diversity of content". If one uses the word "present", it will require the itemisation of every single strand of thought and a decision on whether these strands are represented in the context of an individual media merger. That would be impractical, whereas use of the term "prevalent" indicates that a judgment must be made. This will be done through an advisory group which will advise the Minister and include broad consultation, including consultation with the Oireachtas. Therefore, all parties will have the opportunity to express a view where it is considered a particular point of view is not being adequately represented or which might be jeopardised by a merger.

"Present" is far too fine a definition. It would make it a very complex operation to decide what views were present in the first place, let alone to determine whether a merger would compromise them. The provision was drawn up with good reason by those who had done the work and I am not disposed to move away from a practical approach which requires an exercise of judgment in an individual case as opposed to a broad indication of what is desirable in terms of diversity of content.

Question, "That the word proposed to be deleted stand", put and declared carried.

Amendment declared lost.

Photo of Trevor Ó ClochartaighTrevor Ó Clochartaigh (Sinn Fein)
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I move amendment No. 2:


In page 84, between lines 2 and 3, to insert the following:"(e) all other goods sold in grocery goods undertakings,".
Large retailers stock a vast array of products which are not covered in the Bill. There is no protection for electrical suppliers, hardware suppliers or suppliers of plants and flowers, newspapers and magazines, stationary and greeting cards, clothes, toys and giftware. The aim of the amendment is to ensure all goods sold in grocery goods undertakings would be included.

Photo of Darragh O'BrienDarragh O'Brien (Fianna Fail)
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I second the amendment.

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)
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I go back to the background which prompted the legislation. It was on the back of a number of studies carried out by Oireachtas committees of the groceries sector which found that some very large retailers were thought to have a disproportionate influence on the supply chain. It was considered that we needed to regulate contracts in order that small suppliers in the groceries supply chain would be reasonably protected. The process predominantly focused on food items. We are not here to try to write draft regulations for every sector, which is what the Senator's amendment points towards. There was an attempt to obtain a voluntary agreement in the sector, which failed. Recognising the special position of the groceries sector, we moved to introduce the regulatory powers to insert into contracts certain provisions to protect the supply chain. What the Senator suggests goes way beyond what we envisaged. In all these other sectors general competition law protects players in the marketplace. The provision at issue represents a specific response to a specific problem in the groceries trade. I am not disposed to start to stretch out way beyond what was ever envisaged by the Oireachtas committees that had looked at this or considered it during the consultation process we undertook before introducing the legislation.

Amendment put and declared lost.

Photo of Trevor Ó ClochartaighTrevor Ó Clochartaigh (Sinn Fein)
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I move amendment No. 3:


In page 84, line 5, after "goods," to insert "newspaper and magazine distribution companies".
Amendment No. 3 is to the same provision as amendment No. 2. We are seeking to have newspaper and magazine distribution companies included in the definition being put forward.

Again because these newspaper and magazine distribution companies play a major part in the components of any small local outlet, we felt it was important that this be included, which is why we are proposing this amendment.

2:05 pm

Photo of Darragh O'BrienDarragh O'Brien (Fianna Fail)
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I second the amendment.

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)
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The background to this is the same. This is just a subset of what Senator Ó Clochartaigh's amendment would have provided. For the same reasons, I am not disposed to start picking individual sectors and applying new regulations to them that we have not given any background thought to. This is not a practical amendment.

Photo of Denis O'DonovanDenis O'Donovan (Fianna Fail)
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Is the amendment being pressed?

Amendment put and declared lost.

Photo of Trevor Ó ClochartaighTrevor Ó Clochartaigh (Sinn Fein)
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I move amendment No. 4:


In page 84, lines 27 and 28, to delete "€50 million" and substitute "€10 million".
A relevant grocery goods undertaking means a grocery goods undertaking engaged in the production, supply and distribution, wholesale or retail of grocery goods in the State that has or is a member of a group of related undertakings that has an annual worldwide turnover of more €50 million. We are proposing that this figure should be €10 million. The purpose of reducing the turnover figure is to ensure that the legislation applies to the intermediate suppliers in the supply chain.

Photo of Denis O'DonovanDenis O'Donovan (Fianna Fail)
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Is the amendment being seconded?

Amendment No. 4 lapsed.

Photo of Trevor Ó ClochartaighTrevor Ó Clochartaigh (Sinn Fein)
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I move amendment No. 5:


In page 85, lines 10 and 11, to delete "or indirectly through franchise arrangements,".
It has been argued that franchisees should not be included in any definition in this Bill as it implies that they act in cohort or collectively with a related undertaking. As the Bill stands, there is no specific reference to the amount of grocery goods, as defined, being part of the purchasing made by the franchisee from the related undertaking. This is why we are proposing to delete the words mentioned.

Photo of Darragh O'BrienDarragh O'Brien (Fianna Fail)
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I second the amendment.

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)
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We discussed this and I produced an amendment in the Dáil which I think accommodated the original concern that led to the tabling of these amendments. The issue of franchises has two sides. The individual operator who holds a franchise licence is the franchisee and the overall higher-level operator is the franchisor who operates and controls the franchise. While the majority of individual franchisees are small operations with a turnover of less than €5 million per annum, the parent franchisers are much bigger concerns with turnovers of over €50 million and powerful purchasing powers. It has already been agreed to remove the reference to franchises from the definition of "related undertaking" in a previous Dáil Report Stage amendment as there was never an intention to cover the individual franchisees through the definition of "relevant grocery goods undertakings". However, on the issue of the franchisors, these are intended to be covered by the definition of "relevant grocery goods undertakings". Some franchisors consider themselves to be wholesalers, others to be retailers. To ensure both scenarios are covered, the phrase which the Senators are seeking to delete in the definition of retailer is vital. Without it, there is a danger that retailers could try to circumvent the regulations by operating franchise arrangements. In light of the above, I cannot accept the proposed amendment.

Photo of Denis O'DonovanDenis O'Donovan (Fianna Fail)
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Is the amendment being pressed?

Question, "That the words proposed to be deleted stand", put and declared carried.

Amendment declared lost.

Photo of Darragh O'BrienDarragh O'Brien (Fianna Fail)
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I move amendment No. 6:


In page 85, between lines 24 and 25, to insert the following:"(a) having regard to the importance of and impact to the economic viability and sustainability of primary producers the decisions made at processing and/or retail level,".
We discussed this at length on Committee Stage so I do not propose to go through it again. I reiterate that while the Minister has gone some way by including the economic importance to the State of production, supply, distribution and wholesale and retail sectors in respect of grocery goods in his amendment in the Dáil, I still believe that the sustainability of primary producers is not protectionist. It is important that we protect the quality of our goods and the sustainability of what is a struggling indigenous industry. Having thought about this since last Thursday's debate, I firmly believe that it is important for the Minister to restate that this item would be looked at by way of the review of the legislation because this sector is struggling. I made the points last week so I will not reiterate them. However, I would be interested to hear whether the Minister has any type of commitment he can give in the new session or after this legislation is passed so that his Department through the Department of Agriculture, Food and the Marine would look at it within six months and take on board a regular review of our primary producers of agricultural and horticultural products.

Photo of Trevor Ó ClochartaighTrevor Ó Clochartaigh (Sinn Fein)
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I second the amendment.

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)
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This issue was discussed previously. It really boils down to what we can reasonably expect this legislation to do. What we are seeking to do in this legislation is to regulate contracts between suppliers - typically smaller suppliers - and larger retailers or vice versain the case of small grocery shops with larger wholesalers. We cannot guarantee the viability of any individual player in such a contract arrangement. The world changes and some businesses rise and some fall. Some products produced by primary producers cease to be produced the way they were and some other product is adopted. This goes back to what we are trying to achieve.
We are not trying to put a floor on prices, which some people have advocated. One cannot do that. One cannot allow any producer, by it large or small, to insist that it get a certain price. That would not work in any marketplace. What we are trying to do is put in a recognition of the importance of the sector but not in a way that seeks to deliver a particular outcome because we just could not do that. What we are trying to do is regulate different relationships in the supply chain, "hello money", abuse of promotional arrangements, unfair terms in respect of wastage or loss of products and suppliers who suddenly change the forecast use of a certain product and put all that back on the primary producer. I know that representing the area he does, Senator O'Brien would know all about those difficulties.
That is what we are trying to achieve but we cannot pretend that we can deliver a certain outcome and make any particular enterprise viable and sustainable regardless of the marketplace. What we are trying to do is put in a citation and this is the citation section of the piece. It is against the broad objectives against which we decide the details of the regulation. The citations must be realistic and open. These are the policies and principles upon which the regulations will be based. They must be reasonable.
While I can understand the motivation behind the amendment proposed by Senators O'Brien and Wilson, in practical terms, we must make do with more modest ambitions we can deliver through policy. We are not in the business of trying to set prices that deliver outcomes in terms of the viability of a particular business. That is beyond our ken, which is why the wording we chose was done carefully, having consulted with parliamentary draftsmen and got legal advice as to what sort of reasonable framework we can put in place based on the sort of policy instruments we are trying to develop here. This was the background so it was not without thought that we rejected this but I cannot accept the Senator's amendment.

Photo of Denis O'DonovanDenis O'Donovan (Fianna Fail)
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Is the amendment being pressed?

Amendment put and declared lost.

Photo of Darragh O'BrienDarragh O'Brien (Fianna Fail)
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I move amendment No. 7:


In page 86, between lines 10 and 11, to insert the following:"(2) All retailers defined as relevant grocery goods undertakings must disclose their profits in the Irish market.".
Again, we discussed this at length the other day. It relates to disclosure of profits. I know the Minister gave a response with regard to why would he insist upon it in one sector and not in another. This issue arises later in the Bill and relates to the establishment of an ombudsman in this area. Unfortunately, a later amendment has been ruled out of order. The Minister said on Committee Stage that this Bill aims to bring about "fairness, openness and transparency".

I put it to the Minister that there is no fairness, openness and transparency for the consumer, particularly in respect of many of the foreign multiples operating here and the mark-ups they charge. I do not propose to reiterate the many points I made on this issue last week. I believe what I am proposing would go a long way to protecting the consumer and, in particular, our producers. The Minister knows as well as I do that the large multiplies have a hold over the producer who has planted 50 acres of potatoes or 100 acres of carrots because they know the producers cannot dump them but need to sell them on. This leads to our producers not getting a fair price and, often, getting a price that is below the cost of production. This would be addressed if the Minister were to accept that retailers in this sector should produce their profits and, if they operate across different jurisdictions, show the price in one jurisdiction versus another. I do not propose to labour the point any further as I spoke on it in great detail last week. However, I do intend to push this to a vote. This would be right for the consumer and the producer.

2:15 pm

Photo of Trevor Ó ClochartaighTrevor Ó Clochartaigh (Sinn Fein)
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I second the amendment. I agree with much of what Senator O'Brien had to say. There was a large public meeting in Ballinasloe last Friday night, which was attended by representatives of the large farming organisations who spoke about the crisis in the beef industry. They also raised the issue of the price they are paid for their produce and noted how they have been squeezed by the large multiplies locating here, resulting in their margins decreasing year-on-year while the price to the consumer has not decreased as much. The producers feel they are being squeezed out of the market by ruthless retailers and large multiples and that their lifestyles and those of the small rural farmer have been seriously detrimentally affected by the manner in which the multiples operate in this jurisdiction. They are concerned about the large profits being made by these companies on the backs of their labours.

This is an important amendment. People have been calling for many years for this type of information to be made available by the large multiples. We have no issue with companies coming here and doing a good job and making a profit, but their doing so at the cost of local suppliers, indigenous farmers and producers is unfair. The Minister said that the purpose of this legislation was to ensure a level playing field and fairness and transparency in the retail sector, which we support. We believe this amendment addresses an extremely important issue and for that reason we support it. As recently as last Friday this issue was reiterated by many farmers and mart operators the length and breadth of this country. I believe this is an important amendment that should be accepted by the Minister.

Photo of Aideen HaydenAideen Hayden (Labour)
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I support the spirit of this amendment, which deals with an important matter, one that is a huge source of irritation to people living in this country. I understand what the Minister says, but it would be helpful if he could revisit this issue in the future.

There is no justification for some of the price differentials in this country. I have lived in both jurisdictions. The level of price differential North and South or between Ireland and the UK is unacceptable, regardless of the fact that we are a small open economy and there are higher costs of transport and so on associated with doing business in Ireland. I believe that the pricing policies being applied here differ from those applied by the same multiples in the other countries in which they do business. The fact of the matter is that many small Irish businesses have gone to the wall because of the location of one-size-fits-all multiples on the outskirts of small Irish towns. It would be helpful to the people of Ireland, in terms of openness and transparency and their knowing exactly what they are paying in reality for so-called cheaper goods, to know exactly how much money multiples are making in this country. I know that in the case of one multiple a substantial proportion of its profits are being made in the Irish market, which profits far exceed the proportionate size of its Irish interests.

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)
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I recognise that this is a complicated issue. The danger is the law of unintended consequences. The type of regulation sought by Senators will not deliver what they wish it to do. Individual companies, in the publication of profit returns, do not disaggregate product by product. They do not detail the profit made on potatoes, beef and so on. That is not how companies make their returns. Company returns are made under internationally recognised rules. Ireland has always taken the approach of applying international rules. We do not set sectoral standards in respect of individual standards, requiring that just because we do not like the cut of a particular sector it must make returns in a manner that does not apply to any other sector. I do not think this is the way to go about dealing with the issue. Beneath this there are legitimate concerns, some of which were identified by Senator Hayden. For example, there are certain products that one can buy more cheaply in the UK than in Ireland from the same retailer. According to the National Consumer Agency, which conducts surveys in this area, differentials have come down in recent times, although they still exist. The issue is to what extent these differentials are justified. The way one tackles this is not by seeking to place discriminatory rules of profit publication on individual sectors.

As stated by Senator Hayden in her commentary, we have to know what it is we are concerned about. We cannot on one hand say that some retailers are charging too little and this is undermining the corner grocer and on the other hand say they are charging too much because their prices here are not as cheap as they are somewhere else. The market dictates where price points arise. Irish consumers should perhaps be more vigilant in terms of their choices. It must also be accepted that consumers are under a great deal of pressure. The evidence is that they are shopping more keenly and, in the grocery sector in particular, are shifting towards cheaper and discount outlets. We cannot stop this and should not seek to do so. What we need to do and what we are trying to do in terms of this legislation is to ensure that in the relationship between a producer and a large retail multiple the rules of engagement are fair. The transparency we seek is in that contract being published, available for inspection by the Competition Commission and including certain fair play rules in the manner in which it deals with different elements, be that "hello" money, special promotions or anything else. These are the matters for which we are seeking to provide. We are not seeking to provide that there must always be a product margin of X in any particular good or service. We cannot deliver that. At the end of the day, this is a competitive market.

I know that Senator Darragh O'Brien is frustrated that he cannot move his amendment dealing with an ombudsman. To be honest, the debate has moved on beyond the. The ombudsman scenario arose when the intention was to have not regulations but codes of practice, all of which were to be on a scout's honour basis, with the ombudsman then adjudicating on whether there had been fair play and so on. We made a decision a long time ago that a voluntary system was not going to be possible and that a regulatory system would be necessary. The issue of who should ensure enforcement in the regulatory system and whether we should establish a new quango then arose. Senator Barrett would be berating me today if I were to propose the establishment of a new consumer and competition commission in groceries while we already have a consumer and competition commission for every other sector. We are not providing for an ombudsman for groceries because there is already a consumer and competition commission that deals with every sector. We are not setting up a new agency to deal with one sector when the existing agency has all the powers, experience and so on to deliver what is required. That is the thinking behind it.

Amendment put:

The Seanad divided: Tá, 11; Níl, 30.

Tellers: Tá, Senators Ned O'Sullivan and Diarmuid Wilson; Níl, Senators Paul Coghlan and Aideen Hayden.

Amendment declared lost.

2:25 pm

Photo of Darragh O'BrienDarragh O'Brien (Fianna Fail)
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I move amendment No. 8:


In page 86, between lines 10 and 11, to insert the following:"(2) The Commission may order such redress, including financial redress, for the aggrieved person subject to the breach of regulations as considered appropriate by the Commission having considered all circumstances.".
In light of the Minister's response to this amendment on Committee Stage, I will withdraw the amendment.

Amendment, by leave, withdrawn.

Photo of Kathryn ReillyKathryn Reilly (Sinn Fein)
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I move amendment No. 9:


In page 86, between lines 12 and 13, to insert the following:"(a) subject to a grocery goods undertaking choosing to enter into a contract, relevant grocery goods undertaking shall have a contract with a grocery goods undertaking for the sale or supply of grocery goods,".
This legislation presents an opportunity to address some of the imbalances in terms of negotiating power that exist in the supply chain. Providing for a mandatory contract, which gives the supplier the choice to opt out, is one way we can address this issue.

Photo of Darragh O'BrienDarragh O'Brien (Fianna Fail)
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I second the amendment.

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)
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This amendment, as I understand it, seeks to allow the decision on whether to have a contract governing the chain of supply to be voluntary on the part of one side. Such a provision would undermine the operation of the Bill. The thinking behind the Bill is that if there is a contract, there is a trail of evidence that can be examined by an independent body to see were the terms of the regulation overseen. If we make that voluntary, we would clearly expose the weaker of the two parties to pressure in such a situation where they could be put under pressure not to agree to have a contract and that would negate the purpose of the Bill. I do not believe that Senator Reilly's amendment would be helpful and on that basis I would not support it.

Amendment, by leave, withdrawn.

Photo of Denis O'DonovanDenis O'Donovan (Fianna Fail)
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Amendment No. 10 arises out of Committee proceedings. Amendments Nos. 10, 11 and 13 are related and may be discussed together by agreement. Is that agreed? Agreed.

Photo of Kathryn ReillyKathryn Reilly (Sinn Fein)
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I move amendment No. 10:


In page 86, line 30, after "undertakings" to insert "to be made within 30 days".
This amendment provides for prompt payment to suppliers. Delayed payment remains a problem experienced by small and medium-sized suppliers. The addressing of that issue is the purpose of the amendment.

Photo of Darragh O'BrienDarragh O'Brien (Fianna Fail)
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I second the amendment.

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)
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We discussed this issue on Committee Stage and basically the issue hinges on whether something of this nature should be put into primary legislation which it is set for all time and in all cases or whether it should be left to regulations where, as we now have under section 63B(2)(q), regulations may "specify the manner and timeframe in which payment for grocery goods supplied to relevant Grocery Goods Undertakings are to made". I believe the right approach is to leave the flexibility in this situation and that over time the appropriate credit terms can adjust to changing circumstances. This is not an appropriate area for primary legislation.

Photo of Denis O'DonovanDenis O'Donovan (Fianna Fail)
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Is the amendment being pressed?

Amendment put and declared lost.

Photo of Denis O'DonovanDenis O'Donovan (Fianna Fail)
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Amendment No. 11 arises out of Committee proceedings and has already been discussed with amendment No. 10.

Photo of Darragh O'BrienDarragh O'Brien (Fianna Fail)
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I move amendment No. 11:


In page 88, to delete lines 28 to 30 and substitute the following:"(q) specify that payments to producers will be within a 30 day time limit,".

Photo of Denis O'DonovanDenis O'Donovan (Fianna Fail)
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Is the amendment being pressed?

Question, "That the words proposed to be deleted stand", put and declared carried.

Amendment declared lost.

Photo of Denis O'DonovanDenis O'Donovan (Fianna Fail)
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Amendment No. 12 arises out of Committee proceedings. Amendments Nos. 12 and 14 are related and may be discussed together by agreement. Is that agreed? Agreed.

Photo of Darragh O'BrienDarragh O'Brien (Fianna Fail)
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I move amendment No. 12:


In page 88, between lines 30 and 31, to insert the following:"(r) specify Retention of Title for goods until such time as full payment is received,".
We discussed this issue of the retention of the title of goods in detail. Senator Quinn was helpful in pointing out on the last occasion that many contracts would have such provision in place. It has been suggested by the Minister and others that this would be left up to the parties to the contract as opposed to have such provision in primary legislation. This is still an issue and of that there is no question. Effectively, there are cases where the producers and suppliers are held to ransom and not paid despite the goods still being retained by the retailer.

Photo of Kathryn ReillyKathryn Reilly (Sinn Fein)
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I second the amendment. It is related to the issue of below-cost selling. The Ipsos-MRBI poll survey carried out earlier this year on behalf of Agri Aware showed that nine out of ten respondents believe that legislation should be introduced to ensure that farmers receive a fair price for their produce and only three in ten people believe that below-cost selling of vegetables has long-term benefits for consumers.

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)
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We discussed this matter on the last occasion and, as Senator Darragh O'Brien acknowledged, there is nothing wrong with the retention of title where both sides agree within the contract. The issue arises as to whether we should make this a compulsory element of every contract. As we pointed out, it has a knock-on effect on workers and other suppliers who might be exposed in the event of insolvency if one particular batch of suppliers has a retention of title and others do not. I pointed out on Committee Stage that some jurisdictions would state because of the nature of such retention of title clauses, they should be registered in order that other parties who might be trading with the same company would see these as registered liens, as it were, on what otherwise might be assets in an insolvency situation.

I can understand why Senator Darragh O'Brien is raising this matter but seeking to make retention of title compulsory is not the way to go. What we need to do is to regulate, as we seek to do, the supply chain on a fair basis and leave this as an issue between the parties to decide on whether such terms are open to them.

The Senator also raised the wider issue of whether Ministers should be trying to control prices as opposed to controlling the terms of the contract. We have debated that matter pretty thoroughly here. The issue of trying to control prices or allow people by writing their invoice to declare what the price must be is profoundly anti-consumer and that would be resale price maintenance in normal circumstances, which would be a common abuse of competition law.

That one might include in legislation terms that would effectively police, on behalf of certain groups, their price arrangements makes no sense. The order that allowed this was withdrawn a number of years ago by the then Minister, Deputy Micheál Martin. He made the right call and we are striking the correct balance.

Amendment put and declared lost.

Amendment No. 13 not moved.

2:35 pm

Photo of Kathryn ReillyKathryn Reilly (Sinn Fein)
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I move amendment No. 14:


In page 88, between lines 39 and 40, to insert the following:"(3) The Minister may specify the Retention of Title for goods delivered until such time as full payment is received.
(4) The Minister shall give a direction that a retailer shall not sell grocery goods at a price that is less than the net invoice amount of the goods.".

Amendment put and declared lost.

Photo of Kathryn ReillyKathryn Reilly (Sinn Fein)
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I move amendment No. 15:


In page 89, between lines 19 and 20, to insert the following:"(7) The Commission must provide for anonymity and confidentiality of a complainant who reports a breach of the Regulations, and a complainant who waives anonymity must be protected from discrimination, disadvantage or unfair treatment as a result of the complaint subject to natural justice being afforded to the accused.".
This amendment provides, where requested, for anonymity and confidentiality for suppliers who make complaints about breaches of the regulations and for protection against discrimination by retailers for suppliers who may waive anonymity in making complaints. Obviously, this would be subject to natural justice being afforded to the accused.

Photo of Denis O'DonovanDenis O'Donovan (Fianna Fail)
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Is the amendment being seconded?

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)
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Clearly, it will be in the interests of the commission to protect the anonymity of individuals. That will be its mode of operation. It also has independent powers to investigate cases in which it believes there are abuses. This proposal would not add anything to these protections. As the Senator pointed out, if one is prosecuting and the evidence of the accuser is necessary, anonymity cannot be protected at that stage. The Bill provides for the necessary protections being sought by the Senator.

Amendment put and declared lost.

Photo of Denis O'DonovanDenis O'Donovan (Fianna Fail)
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Amendment No. 16 is out of order.

Amendment No. 16 not moved.

Bill received for final consideration.

Question proposed: "That the Bill do now pass."

Photo of Darragh O'BrienDarragh O'Brien (Fianna Fail)
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I thank the Minister for his attendance in the past few days. Most of the issues were teased out on Committee Stage. However, I still have concerns about certain aspects of the Bill. I disagree with amendment No. 16 on the appointment of an independent ombudsman being ruled out of order. Last Thursday I mentioned that there was an ombudsman's office in Britain that cost £800,000. It has a full-time ombudsman and three staff and operates in an economy much larger than our own. I do not agree with the Minister's fundamental point that an ombudsman could only oversee guidelines or voluntary recommendations. Following the Bill's passage, the ombudsman would oversee the operation of the legislation and the sector in question. The amendment would have given the Bill teeth. For example, the Financial Services Ombudsman, the Pensions Ombudsman and the Pensions Authority oversee their respective sectors through the use of legislation, not guidelines or recommendations. I fail to see the Minister's point and disagree with the Leas-Chathaoirleach's decision in ruling the amendment out of order. It would not have imposed a charge on the Exchequer; rather, I was seeking to have the cost met by the retail sector, as is the case in Britain.

Broadly, I am satisfied with the Bill, but I have grave concerns about specific aspects that relate to producers in the agriculture sector and the grocery trade. The powers required to ensure fair play for consumers and producers are not fully enshrined in law. My group will support the Bill in general, but the Minister should keep a watching brief on this matter. He and his Department should be proactive in this regard and not wait until Christmas or Easter for a raft of below cost selling cases to hurt indigenous industries, family-owned businesses and quality producers in a race to the bottom.

I will not repeat the points I made on Committee Stage, but my job, as a legislator, is to make points on behalf of the people, employers and consumers as best as I can. I commend the Minister for the great deal of work done on the Bill and congratulate him on the retention of his Ministry. He has done a good job so far. I ask him to keep a close watching brief on this crucial industry. The Harvest 2020 strategy was produced by my colleague, Deputy Bendan Smith, and followed up by the Minister for Agriculture, Food and the Marine, Deputy Simon Coveney. Agrifood is an important sector and, while we should not introduce protectionism, we should not be ashamed of trying to protect and grow it. These jobs will stay and not move in ten or 15 years time.

I thank the Minister for his attendance and interaction in recent days.

Photo of Trevor Ó ClochartaighTrevor Ó Clochartaigh (Sinn Fein)
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I thank the Minister for introducing the Bill. We will not oppose it, but we have raised our concerns. I appreciate the Minister's statement that some of these cannot be addressed through the Bill, but I hope he will revert to the House with a number of solutions to these pressing issues. He is the Minister with responsibility for jobs. The agriculture sector, in particular, is concerned about indigenous jobs on farms. There is no point in having jobs in the retail sector only to lose them in agriculture. It is important that the Minister sit down with the Minister, Deputy Simon Coveney, to discuss this matter.

All of the farming interests were present at the meeting I attended on Friday evening. They voiced their concerns about a cartel operating in the meat processing industry. If a number of individuals rule that industry, the sense is that they are putting controls in place that are squeezing people out of the market. The farming interests called for this issue to be re-examined. The Minister might ask for evidence in order that he might act on it, but we were asked to raise this strong sense with the Government and it should be considered. The farming interests' other major concern was related to the impact of some international agreements, particularly with Brazil and the mooted agreement between the European Union and the United States, on jobs on Irish farms.

I appreciate that the Bill is limited in what it can do, but perhaps the Minister might revert to us in the autumn on the issues we have raised and outline how the Government could support indigenous horticultural, meat or fish producers. Such support is equally important, as the people concerned spend in their local areas and their incomes make a difference to their communities.

Photo of Sean BarrettSean Barrett (Independent)
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I welcome the Minister. I was glad to see that the glowing tributes paid to him last week had made such an impression on the Taoiseach that he made the correct decision.

As the Minister had answered all of our points on Committee Stage, I did not resubmit amendments on Report Stage. Regulatory capture, one of the issues we discussed, is a significant feature of the economy. When I left on Thursday, an evening newspaper claimed that there had been no arrests in the clampdown on rogue taxi operators. The taxi industry has achieved regulatory capture of its regulator to such an extent that we have had wild goose chases on the grounds that some taxi operators were tax dodgers - this was found not to be the case - social welfare fraudsters or, most recently, criminals.

The Taxi Regulator must serve the consumer as well and that post has been captured.

In terms of health insurance, I have always believed that it operates on behalf of the VHI and we ignore Supreme Court and European Court decisions here.

Item 46 on the Order Paper is Senator Quinn's Bill, which I supported, on trying to open up that market. If we are making health insurance compulsory then we have got to listen to the consumer sometimes. In the court case I did not see any witnesses produced to attest to the fact that new entrants had refused cover to old people but I did see the State represented by the Department, the Health Insurance Authority and VHI which meant there were three sets of lawyers to prevent competition in the sector.

The energy sector was captured also and a 55% increase in the public service obligation has been mooted. The bus sector will not be competitive for another 100 years, it happens in airports and our financial services sector is in an appalling state. Setanta was another insurance company which we thought was licensed in Malta but the bill will be sent to the Irish consumer. Strengthening, as the Bill does, the Competition Authority and consumer representation is most important and badly needed.

Some of the discussions have led to the invention of an ogre or bogeyman. In hugely competitive areas such as the media - and I mentioned that there are over 400 producers - and groceries - despite claims by the rest of the House that it is not competitive but I side with Senator Quinn that these are highly competitive industries - the tests are new entrants and the absence of regulatory capture. We have had new entrants in the groceries sector. However, we have invented the bogeyman that these people sell below cost first, get rid of their competitors and then increase the prices afterwards. I have waited for more years than I care to remember but the prices have not gone up and the industry's concentration is going down. Sometimes when producer groups go to the Minister, as the representative of consumers, they attempt to use consumer legislation to get at other producers or new entrants. The Minister should be very alert to that factor and it is also part of the Government's general concern about the activities of lobbyists. The consumer should be the voice that he listens to, not producers saying they would like their competitors put out of the market and will call it bogus consumerism.

The Minister is most welcome back and what he is doing to make the Irish economy more competitive is vital. As stated several times in the Bill, we need the sheltered sector services to become more competitive because the vital sectors that created the 70,000 jobs over the past year, as mentioned by the Minister, must compete internationally. They should be allowed to buy inputs at the best prices we can deliver. I thank the Minister and welcome him back to the House.

2:45 pm

Photo of Denis O'DonovanDenis O'Donovan (Fianna Fail)
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I remind Senator Quinn that we have just two minutes to finish the Bill but it has not been passed yet.

Photo of Feargal QuinnFeargal Quinn (Independent)
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I will not take two minutes. I welcome the Minister back in again and he is wearing the same hat he has worn before. We are very happy with the work he has put into this matter and congratulations. We are debating the Competition and Consumer Protection Bill but I did not hear enough from most of the speakers about consumer protection which means competition and competition, as the Minister has rightly said, is what gives consumers protection.

I remember when the Berlin Wall came down I met a number of Polish and other people in western Europe who said they could not figure out the correct price. They were used to everything being sold at the same price everywhere and they could not get over different shops selling the same items at different prices which is what competition is. I support below cost selling and see nothing wrong with it. The Bill affords protection to the consumer so I say "Well done" and congratulate the Minister.

Photo of Michael MullinsMichael Mullins (Fine Gael)
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I join in the tributes and thanks extended to the Minister for steering the legislation.

Photo of Denis O'DonovanDenis O'Donovan (Fianna Fail)
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It has not been passed yet. We do not want to jump the gun.

Photo of Michael MullinsMichael Mullins (Fine Gael)
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It is looking ominous. We can see what a good job the Minister has done when all sides of the House are supportive. As Senator Quinn has said, the Bill will be good for consumers and ensure robust competition. The Minister has done a major service to preserve competition and protect the consumer. I wish him continued success for the remaining life of the Government. As previous speakers have said, he has done an excellent job as Minister for jobs and enterprise. We all want to see an acceleration of the excellent figures experienced in the first half of the Government's term.

Photo of Aideen HaydenAideen Hayden (Labour)
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I am personally very pleased that the Minister has retained his important portfolio which is a critical one for the country. He has great expertise in this vital area.

On Second Stage I made a number of comments about the Bill and today I would like to comment on the new body. It is important that the new body is properly resourced and given every facility it needs to do its job. We should be open to new ideas. A number of issues have been raised by both sides of the House which should be kept under review. Nothing is ever too perfect that it cannot be looked at a second, third or fourth time.

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)
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I thank the Senators for a worthwhile debate and wish to quickly respond to points raised.

I do not believe in sectoral regulators of competition because it is a bad precedent to create and exposes one to what Senator Barrett talked about. Clearly, certain monopolies have them because the wider public interest must be served. In the competition sector, generally, the right approach is the one we are taking and we are merging consumer and competition together which will make things better. Whether it is an unfair term in a consumer contract or a barrier to entry, there is one authority with strong powers that will protect consumers.

Obviously competition is never done. If there are concerns about cartels anywhere in the economy the Competition Authority has ample powers that it is not afraid to use to pursue them. To take up the point made by Senator Hayden, we have beefed up its capacity for enforcement with additional staff.

We can have a debate on trade agreements on another day. Clearly, all trade agreements are give and take. There are opportunities and problems in any trade agreement and that applies not least to the food sector. Trade agreements generally favour small open trading economies like Ireland's and that means opportunities.

Senator Barrett is always concerned about regulatory capture. It is a genuine concern and I hope that we have struck the right balance in the legislation. I thank Senators Mullins and Hayden for their support. This legislation is not the last word on competition or consumer protection because we will be back next year, God willing, with a Bill on consumer protection, in which I am sure Senator Quinn will have an interest. We recognise that the sector is an evolving area.

Question put and agreed to.