Vol. 350 No. 9
andMr. Molony asked the Minister for Industry, Trade, Commerce and Tourism if he is satisfied that the schemes operated at present by multi-national oil companies offering give-away gifts for the purchase of minimum amounts of petrol are in the interests of the consumer; and if he will make a statement on the matter.
14.
andMr. Molony asked the Minister for Industry, Trade, Commerce and Tourism if he is aware that independent petrol retailers have to pay in excess of 14p for each £12 worth of petrol sold by a particular multi-national oil company (details supplied) in order to participate in a scheme in which the consumer is giving one glass tumbler for each £12 worth of petrol purchased by him; and if it is reasonable to have such schemes operated by multi-national oil companies given the fact that they own 36 per cent of the petrol retail outlets (and a larger share of petrol retail sales) and that their share of outlets is expanding.
I propose to take Questions Nos. 13 and 14 together.
As regards the schemes referred to by the Deputies my understanding is that these schemes are operated by the oil companies concerned on a voluntary basis. There is, therefore, no obligation on independent petrol retailers to participate in such schemes and any decision to do so must be taken by the individual retailer concerned.
So far as company-owned stations are concerned, I would point out that Article 31 (1) (d), of the Restrictive Practices (Motor Spirit and Motor Lubricating Oil) Order, 1981, expressly forbids any provision in a licence or lease in respect of a company station which requires the licensee to participate in any such promotion which would have the effect of reducing the net profit margin of the station.
The percentage of total petrol retail outlets owned by non-Irish oil companies in 1982 was 10.7 per cent. The figure of 36 per cent referred to by the Deputies represents the total percentage of overall petrol sales in that year accounted for all oil companies, both Irish and multi-national, through company owned stations.
The 1981 Order also confirmed a freeze on the total number of retail outlets which could be operated by the multi-national oil companies in Ireland. Their share of the total number of outlets is not, therefore, expanding.
As regards the interests of the consumer my understanding is that the gifts referred to are not offered by all oil companies or, indeed, by all retailers supplied by a particular company. The consumer, therefore, has a choice in relation to whether he or she wishes to avail of the offer concerned.
Did I understand the Minister to say that the petrol retailers could not engage in the operation as it would reduce their net profit margin?
I will read what I said again as it is important that the Deputy should get it right:
So far as company-owned stations are concerned, I would point out that Article 31 (1) (d) of the Restrictive Practices (Motor Spirit and Motor Lubricating Oil) Order, 1981, expressly forbids any provision in a licence or lease in respect of a company station which requires the licensee to participate in any such promotion which would have the effect of reducing the net profit margin of the station.
I understand the point which the Minister made but is he aware that there is considerable concern among independent petrol retailers that they are slowly but surely being frozen out by the multi-national concerns who have tried to purchase a number of the most valuable retail outlets here? The independent retailers feel that they cannot complete and cannot afford to participate in give-away schemes of this nature.
The order prohibits an oil supplier who has more than 20 company stations from opening more than two new company stations in any year unless at least two other company stations cease to carry on business in that year. I recognise that such control means that companies can substitute a station with a higher turnover for one with a lower turnover which they close and this allows them to increase their volume of sales.
My main concern is that these give aways are being used as a means——
A question, please, Deputy.
Does the Minister fear that these give-away schemes which are operated by all the multi-nationals are being used as a means of freezing out some of the independent retailers, given the fact that the share of petrol sales by the multi-nationals has been going remarkably well?
I have no reason to believe that the give-away schemes have that effect as they are available generally to people participating in the distribution of petrol and are not confined to company-owned stations, to my knowledge. There may be a general concern about the matter but that is a separate issue.
Is the Minister aware that the Independent Petrol Retailers' Association have expressed grave concern about this?
I am aware of their continuing concern about the general phenomenon of company-owned stations. In order to achieve a balance between their interests, those of the oil companies and, more importantly, the interests of the consumer who wants to have the most efficient petrol distribution system, the restrictive practices inquiry, after due consideration made the recommendations, which were implemented.
The Minister has not made his backbencher happy.
