I move that the Bill be now read a Second Time.
The primary purpose of the Bill is to improve in certain respects the machinery provided by the Restrictive Trade Practices Act, 1953, for the investigation of restrictive trade practices and for the taking of remedial action in respect of those practices which are found to be unfair or to operate against the public interest.
It may be of assistance to the House in considering the Bill if I recall briefly the main provisions of the Act of 1953. That Act provided for the establishment of the Fair Trade Commission, and the Commission was duly set up with effect from 12th June, 1953. The Commission have the power to investigate restrictive trade practices in regard to the supply and distribution of goods and the rendering, in the course of carrying on any trade or business, of any services affecting such supply or distribution. In the discharge of their functions, the Commission are empowered to summon witnesses and examine them on oath and they may require a witness to produce any documents in his power or control. Witnesses before the Commission are entitled to the same immunities and privileges as if they were witnesses before the High Court.
The investigation of restrictive practices may be approached by the Commission in two different ways. First, the Commission may prepare and publish rules—known as fair trading rules—representing, in the opinion of the Commission, fair trading conditions with regard to the supply and distribution of any kind of goods and the rendering of any services affecting such supply or distribution. Such rules have not the force of law, but they represent a code of conduct for the particular trades concerned. The trade interests involved have the opportunity of voluntarily adhering to the rules and abandoning unfair restrictive practices. The Commission are obliged to keep under review the operation of fair trading rules and to report to the Minister for Industry and Commerce if the rules are not being observed. The second method which the Commission may adopt for the investigation of restrictive practices is to hold a public enquiry into the conditions which obtain in regard to the supply and distribution of the goods concerned. The Commission may hold such an enquiry on their own initiative, and they must do so if the Minister so requests. The Commission are required to submit to the Minister a report of every enquiry.
A report submitted to the Minister by the Commission in relation to the non-observance of fair trading rules, or following the holding of a public enquiry, must describe the conditions which obtain in regard to the supply and distribution of the goods concerned. The report must indicate whether these conditions prevent or restrict competition or restrain trade or involve resale price maintenance. If, in the opinion of the Commission, any such interference with trade or competition is unfair or operates against the public interest the report must given reasons for the Commission's conclusions. The Minister, having considered such a report, may make an Order prohibiting specified arrangements, agreements or practices in the trade concerned. An Order so made by the Minister does not have the force of law unless and until it is confirmed by an Act of the Oireachtas.
To date 19 sets of fair trading rules have been made relating to the supply and distribution of a wide variety of commodities, and six public enquiries have been held in relation to the supply and distribution of radio and television sets, building materials, motor vehicles, grocery goods, chemists' preparations and carpets. Reports of all six enquiries have been submitted to the Minister, and five of these have been published. The other report, relating to carpets, is at present under consideration by me. Orders have been made in relation to the supply and distribution of radio and television sets, building materials, motor cars and grocery goods. In the case of chemists' preparations, the Commission recommended the making of an Order, but the then Minister decided not to act on the Commission's recommendation as he felt that an Order on the lines recommended would not entail any marked alteration in the manner in which the trade was being conducted. The operation of the Orders relating to motor cars and radio and television sets has been reviewed by the Commission, and reports have been submitted in this matter to the Minister. In both instances the Commission's recommendation was that the Order should not be altered, and this recommendation was accepted.
In regard to goods which are subject neither to Orders nor fair trading rules, the Commission give advice, on request, to manufacturers and traders and seek by negotiation to procure a satisfactory settlement of complaints concerning the operation of restrictive practices. The Commission also keep themselves informed of new ideas and developments in regard to restrictive trade practices in other countries and maintain relations with other similar bodies abroad.
An examination has been carried out of the operation of the Restrictive Trade Practices Act, 1953, in the light of experience over the past six years. In the course of the examination, consideration was given to the question whether legislation embodying a different approach to restrictive trade practices, such as is followed in some other countries, would be more suitable to conditions here. The conclusion reached was that the fundamental structure of the 1953 Act has stood the test of experience and that it should be retained. The Act has undoubtedly enabled substantial progress to be made in a relatively short time in eliminating some of the more objectionable features of restrictive practices in many trades. Experience has shown, however, that some modifications of the Act are desirable in relation to the scope of public enquiries and the procedure for the review by the Commission of the operation of Ministerial Orders.
A public inquiry must deal with all the conditions which obtain in regard to the supply and distribution of the goods, and all restrictive practices affecting their supply and distribution. This arrangement precludes the holding of an inquiry of limited scope, for example, an inquiry confined to one particular practice. I consider it desirable that the Commission should be empowered to hold such limited inquiries and Section 2 of this Bill provides accordingly.
The review of the operation of existing Orders is obviously an important part of the Commission's functions. Conditions in trades are liable to change and it is desirable that the effect of Orders should be closely watched by the Fair Trade Commission. The 1953 Act requires the Commission to keep the operation of Orders under review and provides that the Commission may submit to the Minister a report in the matter together with their recommendations as to what action should be taken. If a report by the Commission should indicate the necessity for amending an Order, it would be necessary to have a further public inquiry.
This procedure for the amendment of Orders is cumbersome and unsatisfactory. I have considered this difficulty and I am satisfied that it can be surmounted by the introduction of the new procedure which is provided for in Section 6 of this Bill. That section provides that the Commission may on their own initiative, and shall, at my request, hold a special review of the operation of an Order. The Commission are required to publish notice of their intention to hold a special review and give interested parties an opportunity of making submissions in relation to the subject matter of the review. It will be open to any interested person to ask the Commission to hold a public inquiry instead of a special review, and if the Commission decide against holding a public inquiry, they must inform the party concerned of the reasons for their decision.
The Commission will be required to submit to the Minister a report of every special review and, if they are of opinion that the relevant Order should be amended, they must recommend accordingly and indicate the form of amending Order which they consider necessary. A copy of the Report of every special review will be laid before each House of the Oireachtas.
I propose to take advantage of this occasion to introduce a new provision authorising the Fair Trade Commission to investigate restrictive practices imposed by employers or employees affecting the use of specific materials or methods for manufacturing or construction purposes. Section 4 of the Bill provides the Commission with the necessary power to undertake enquiries into these matters. Enquiries of this kind may be undertaken only at my request.
In essence, the aim of Section 4 is to enable the Commission to investigate complaints that restrictive practices relating to the use of specific materials or methods prevent the reasonable development of trade and business and inflate costs. It is not the intention that Orders will be made on receipt of a report from the Commission dealing with practices of this kind.
I feel, however, that it will serve a useful purpose if practices of the kind involved are enquired into and reported on by an impartial body such as the Fair Trade Commission. As stated in last year's Government White Paper on Economic Expansion, restrictive practices, whether by employers or labour, inflate costs of production and distribution and retard the expansion of output and employment. The development of the economy depends on our being able to offset the competitive advantages of other countries by more efficient production. It is essential, therefore, that restrictive practices of this nature be abolished and it will be an object of Government policy to secure enlightened co-operation towards this end.
The Bill provides also for a few minor amendments of the Act of 1953 which are, in the main, consequential on the principal amendments which I have already mentioned. I am satisfied that this Bill will improve the procedure established by the Act of 1953 for the investigation of restrictive trade practices and for the elimination of those practices which are unfair and are against the public interest. I commend the Bill to the House.