Dáil Éireann debate -
Tuesday, 24 Mar 1998

Vol. 488 No. 7

Written Answers. - Milk Supply.

Michael D. Higgins

Question:

69 Mr. M. Higgins asked the Tánaiste and Minister for Enterprise, Trade and Employment if she has satisfied herself that the interests of consumers is served by the existing arrangements and pricing structures for the supply of milk; and if tendencies to monopoly have been reported to her Department. [6963/98]

Tánaiste and Minister for Enterprise, Trade and Employment (Miss Harney)

Arrangements for the supply of milk are governed by a large number of factors, including competition in the market. A benefit of competition in the market is downward pressure on prices benefiting consumers. Competition policy in the State is now governed by the Competition Act, 1991, and the Competition (Amendment) Act, 1996.

Section 4 of the Competition Act, 1991, prohibits and makes void all agreements between undertakings, decisions by associations of undertakings and concerted practices which have as their object or effect the prevention, restriction or distortion of competition in trade in any goods or services in the State or in any part of the State. Section 5 prohibits any abuse of a dominant position.

The Competition (Amendment) Act, 1996, provides for public enforcement of the Competition Acts and for offences and penalties for breaches of the rules of competition. The independent Competition Authority, which was established under the Competition Act, 1991, now has the power to bring civil and-or criminal proceedings in respect of breaches of the Competition Acts. In the case of criminal proceedings the 1996 Act provides for fines of up to £3 million or 10 per cent of turnover for firms found in breach of the law, and for imprisonment for individuals. The 1996 Act also created the position of director of competition enforcement to give effect to the public enforcement provisions.

The Competition (Amendment) Act, 1996, also gave the Competition Authority the right to initiate investigations on its own initiative into any alleged anti-competitive structure or practice which appears to it to warrant such investigation.

As a result of the enactment of the Competition (Amendment) Act, 1996, there are now two alternative ways for an individual or firm to pursue allegations of breaches of competition rules: (i) take civil action under section 6 of the Competition Act, 1991, or (ii) make a complaint to the director of competition enforcement requesting him to investigate alleged breaches(s) of competition law.

I am aware that the merger of the Avonmore and Waterford co-operatives which I approved in 1997 has given rise to increased concentrations in the liquid milk market in Dublin and Leinster, and while there are clear dangers in concentrations in any busines sector, I am assured that the Avonmore and Waterford Group will live up to their statement to fully comply with the spirit and the letter of all legislation impinging on their behaviour in the market.

In any event, the proactive powers of the director of competition enforcement are designed to ensure that there is no abuse of market position that is contrary to the interests of consumers and in breach of the Competition Acts.

If the Deputy has evidence of anti-competitive pricing practices or a cartel in the milk or any other sector he should bring it to the attention of the director of competition enforcement.