Michael Noonan (Limerick City, Fine Gael)
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I propose to take Questions Nos. 69, 73, 74 and 76 together.

I am advised by the Revenue Commissioners, who are responsible for tackling fuel fraud, that they are very aware of the risks posed to consumers' vehicles, legitimate businesses and the exchequer by all forms of such fraud.

Revenue has, over the recent past, received reports from a variety of locations around the country of problems relating to petrol quality, and suggestions that these problems are attributable to petrol stretching. Petrol stretching involves the illegal addition of a low tax commodity to petrol to defraud motorists and the State. The numbers of complaints of this kind received by Revenue in counties Mayo, Roscommon, Galway and Leitrim in the period since July 2014 is 31, comprised of 1 in July, 7 in August, 17 in September and 6 to 21 October 2014. An analysis of the complaints on a county basis is set out in the following table.

Complaints Received in Relation to Petrol Stretching	#	#	#	#
	July	August	September	October
Mayo	0	4	10	1
Roscommon	0	3	4	1
Galway	1	0	3	4
Leitrim	0	0	0	0

Revenue investigates all complaints of this kind and fuel samples are taken from filling stations and referred to the State Laboratory for analysis where the investigating officers have reason to suspect excise fraud. To date 48 premises nationwide have been tested with samples referred to the State Laboratory.

Conclusive results have been received in one case which confirms contamination through the presence of kerosene and Revenue are considering the possibility of prosecution in this case.  Final results are awaited in respect of the other samples referred for analysis.  It is understood the State Laboratory is reviewing its existing procedures with a view to expediting testing which, I am informed is quite complex.

Petrol stretching is an offence under section 102 (1A) of the Finance Act 1999. The Deputies can be assured that, if Revenue's investigations and the analysis of fuel samples indicate the presence of illegal stretching agents in petrol, Revenue will take action and pursue prosecutions against offenders where possible.

I understand also that Revenue has been in contact with the motor and fuel trades about the reported problems. Cooperation with the fuel trade has been an important element in the successful work undertaken in recent years to combat fuel fraud, and can play a key role in addressing any further issues that come to light. It is essential, in particular, that petrol distributors report on any reduction in the pattern of legitimate supplies of fuel to the retail trade which may indicate that specific traders are shifting some of their sourcing to illegal fuel.

Motorists themselves should take care about where they source their petrol, and should report any suspicions to Revenue. Revenue has recently launched a dedicated section of its website specifically dealing with the shadow economy and this includes an electronic reporting facility for anyone who has information about shadow economy practices including the adulteration of fuel.

The first point of contact for motorists whose vehicles may have been affected should be their motor insurance companies. Persons affected should also contact the point of purchase of the fuel. If they remain unsatisfied, they may have recourse to civil remedies and should seek legal advice.

All trading entities are obliged to ensure that they are correctly registered for all taxes as required by legislation. In addition, a person engaged in the sale of petrol or diesel is required to hold an auto fuel trader's licence or a marked fuel trader's licence. Revenue enforces this licensing requirement rigorously and also acts to ensure that businesses of this kind are conducted in accordance with licence requirements. Action is taken in any case where unlicensed trading, or failure to comply with a licence's terms and conditions, is encountered. In the period from 2011 to date, more than 130 filling stations were closed, mainly for breaches of licensing conditions.

In summary an extensive range of new measure has been introduced over recent years to tackle fuel fraud, including enhanced supply chain controls and the acquisition of a more effective fuel marker. Key measures include the following:

- The licensing regime for auto fuel traders was strengthened with effect from September 2011 to limit the ability of the fuel criminals to get laundered fuel onto the market;

- A new licensing regime was introduced for marked fuel traders in October 2012, which is designed to limit the ability of criminals to source marked fuel for laundering;

- New requirements in relation to fuel traders' records of stock movements and fuel deliveries were introduced to ensure data are available to assist in supply chain analysis;

- New supply chain controls were introduced from January 2013 following  significant investment in new IT systems. These controls require all licensed fuel traders, whether dealing in road fuel or marked fuel, to make monthly electronic returns to Revenue of their fuel transactions.  Revenue is using this data to identify suspicious or anomalous transactions and patterns of distribution that will support follow-up enforcement action where necessary, and

- An intensified targeting, in co-operation with other law enforcement agencies on both sides of the border, of enforcement action against suspected fuel laundering operations.

In addition to the measures implemented to date, Revenue has, in partnership with Her Majesty's Revenue and Customs in the UK identified a more effective fuel marker and it is expected that a new marker will be introduced in both jurisdictions early in 2015 following consultation with the oil industry and other stakeholders.

To support further the integrity of the distribution system and minimise the risk of fraud, I introduced a provision in the Finance (No. 2) Act 2013 that will make a supplier who is reckless in supplying rebated fuel for a use connected with excise fraud liable for the duty at the standard rate of tax. This new provision will strengthen Revenue's hand in dealing with those traders supplying rebated fuel recklessly to dubious customers and will provide a further disincentive to such activity. Revenue has published guidelines for mineral oil traders which will assist them in identifying and avoiding such transactions. I am committed to providing new measures to further assist Revenue in its work against fuel fraud should it be required.

I am advised also that the Revenue Commissioners work in close cooperation with other enforcement authorities, in this jurisdiction and in Northern Ireland, to combat this all-island problem. The Cross Border Fuel Fraud Enforcement Group, which includes representatives of the Revenue Commissioners, An Garda Síochána, Her Majesty's Revenue and Customs and the Police Service of Northern Ireland and other relevant organisations, was established to facilitate this cooperation, and has proven effective in supporting the identification and targeting of the organised crime gangs, many of whom have links to paramilitaries and former paramilitaries, that are responsible for the bulk of fuel fraud. All enforcement authorities engaged in combatting fuel fraud are committed to working closely together on an on-going basis in this important work.