I would like to thank the Senators who have spoken and for their welcome for the Bill. I will try to deal with the points raised in broad terms at least. Many detailed questions were asked and it would be more appropriate perhaps to deal with them on Committee Stage which I understand will be next week.
Many of the points raised are a repetition of what was said in the Dáil, one of them being a complaint or an accusation of lack of consultation. Obviously with a Bill of this nature one does not consult large numbers of people about it before publication because that would not be appropriate.
The Fair Trade Commission were asked to study the matter and to make their recommendations which they did in some depth and they invited and received full submissions from a large number of organisations. It was known that the Bill was under preparation and its general nature was known from a considerable number of speeches I made. People were free to comment and to express the view that a Bill of some other kind might be brought forward. Most comments made over the last year and a half were complaints not about the proposed content of the Bill but about the delay in bringing it forward. The delay was caused by the necessity to balance some of the delicate and conflicting views and interests which inevitably have to form part of legislation of this kind especially when we have not had anything on these lines before.
Since the Bill was published on 12 April last, almost three months ago to the day, we have had a large number of consultations with all interested parties. Compared with some Bills it did not provoke any rush of observations because I think the majority of people are happy and satisfied with it as were Members of the Dáil and I think the majority in this House are also happy with it.
Consultations were held either by me personally or by officials of my Department on 3 May with the Food, Drink and Tobacco Federation and with the CII; on 6 May with ICTU; on 13 May with RGDATA; on 14 May with the Newspaper Retailers' Association; on 22 May with the Law Society; on 28 May with the ESB and also with the CII and early in June with the Licensed Vintners' Association. I attended and addressed four seminars on the topic which were organised since the Bill was published. On 11 May I addressed the Irish Centre for European Law at Trinity College; on 16 May the Irish Centre for Commercial Law Studies at UCD; on 6 June an Irish business seminar at Jury's Hotel, Dublin; and on 18 June the Dublin Chamber of Commerce, Dublin. As well as expressing my views at those various seminars I or my officials had the opportunity of hearing the views of many European and Irish experts on competition law and we received a useful input of differing views.
The remarkable thing is that for a Bill of such importance relatively few views were put forward which can only be because people in general are quite satisfied with it and are happy that something that has worked well in the European context over a period of 30 years is likely to work in the Irish context. If anything, we have been somewhat remiss in not initiating something of this kind before. I attempted when in Opposition to introduce a Private Members' Bill on the lines of this Bill in the Dáil in 1987 but it was defeated then which was a pity. However, it gave us the opportunity to think more fully about what was involved and to avail of the opportunity to polish and hane the different concepts and to consider how they might be applied.
The principal specific concern relates to the grocery order and I dealt with that this morning. I have no intention of repealing it until I have the views of the Fair Trade Commission and have had a full opportunity to consider them to see where the balance of public interest lies in the matter. In connection with, for example, the supermarket trade or the grocery trade Senator Cullen asked whether the Minister would look at past situations. I think he instanced the supermarket question and asked whether the size of companies could be reduced. If there is abuse of a dominant position an investigation can be carried out under section 14 and this could lead to an order being made by the Minister which would require either the prohibition of the continuance of the dominant position or, more likely, require the adjustment of the dominant position, if necessary by a sale of assets. In other words, those whose trading activity constitutes, or is found after an inquiry to constitute, an abuse of dominant position could be required here as they are in other countries to dispose of part of their assets in that business compulsorily if they want to continue in it and so would no longer be in a dominant position.
The inquiry was made whether the Authority will have sufficient resources. The position there is that the secretariat which is currently available to the Fair Trade Commission will be augmented in numbers and in expertise and that will then form the expanded secretariat for the new Authority. I am satisfied in so far as one can be in these days of unremitting pressure to reduce public service numbers that it will be adequate. I hope we will not have a repetition with this body of the annual complaints about inadequate numbers made regarding at least one other body. If my Department or sections within my Department were allowed by law to produce annual reports of their own activities, top of the agenda for many of them with every justification would be lack of numbers. Some of these external organisations have the right to say whatever they want in public and they tend, as is the wont of human nature, to latch on to the perceived shortage of officials. I hope that will not arise here and I recognise that the need for extensive secretarial and expert back-up will be greatest in the early years and that numbers could be allowed to decline somewhat after that because pressure will be greatest when initial applications for exemption and negative clearance come in.
Senator Howard questioned the adequacy of the Judiciary to deal with these matters which are essentially European rather than Irish in character. I feel confident in assuring him that the Judiciary will not have any great difficulty. They already deal with Articles 85 and 86 as far as Community-wide activities are concerned and I do not think they will have any problem applying those principles to the domestic situation. It is not all that new to them. European case law has been a guide to Irish courts in appropriate circumstances since we joined the Community on 1 January 1973. It is applied to the Irish courts and to Irish law by Statutory Instrument 341 of 1972 which I discover I made on 29 December 1972 applying European case law from the date of our entry. While many people would not be conscious of it the courts, and particularly the Superior Courts, are certainly conscious of it and decisions are made regularly on that basis.
I did consider, as Senators will know, having the Circuit Court deal with such matters until such time as a further body of law was built up in Ireland. As a result of the discussions particularly on Committee Stage in the Dáil I thought it reasonable to bring the Circuit Court into it where actions for abuse of a dominant position are concerned which are fairly straightforward, even though the Circuit Court up to now would not have been dealing with matters of European law.
Senator Honan asked about the composition of the Authority. As I said before, I envisage — although I am not bound by it and could change my mind — that the existing members of the Fair Trade Commission would constitute the membership of the Competition Authority. The Fair Trade Commission will be going out of existence on the day the Competition Authority comes into existence and it makes sense to transpose one body into the other rather than have parallel quangos or whatever operating which we cannot afford.
It seems to me that the present membership is appropriate to the duties of the Authority. The policy role is one for the Minister and the Fair Trade Commission in its report on competition law saw a role for itself akin to that of the European Commission. Senator Honan quoted a number of the recommendations or conclusions of the Fair Trade Commission in their report on competition law and she will find on a full examination of it that their recommendations were very much in accord with the operation of the system in the European Community. They envisaged themselves having the same functions as the Commission which is a very complicated system because of the size of the Community and the complexity of intra-Community commercial relations and the original development of a Common Market which has now become a Single Market. It seemed to me on reading the report of the Fair Trade Commission that their proposal was unnecessarily complicated and that we could have the good features of the European system without the complexity by simplifying it to apply to Irish circumstances and the Bill has been drafted on that basis.
The Commission have not issued a formal comment or report on the Bill but have informally indicated to me that their own recommendations were somewhat complicated and that the system now proposed in this Bill is perfectly satisfactory. To that extent it is not apposite to quote some of the things they said in the belief that a precise parallel to the European Community situation would be brought in here. The Senator read one of their recommendations about the power of the Commission and what they saw as their power here to impose fines. As Senators will know, fines imposed in the Community by the Commission can be very high; fines in excess of 50 million ECUs were imposed recently on two or three companies which is a very substantial amount of money. If we were to establish a body here other than the courts and allow them to impose fines that ran into tens of millions of pounds, any such exercise or proposal would be declared unconstitutional. That was the view of the Attorney General and that was why he agreed with the necessity for a less complicated structure that reflects the principles rather than the exact administrative aspects of the European system.
Senator B. Ryan felt that anti-trust law has to be worked at and that the model we are using is not necessarily ideal but it is based on the best that is available. The Senator felt that what we were doing was not strong enough and he instanced some of the problems that the authorities in the United States, for example, have run into. The Bill is not a cure for all our economic ills and it was never suggested that it should be but it is an essential element in enabling this country to remove a significant impediment to economic development. I have instanced other countries where I feel the level of competition encouraged by law has had an enormously beneficial effect on their economy.
This morning when introducing the Bill on this Stage, I said that this country was put at a significant disadvantage by the fact that many aspects of business here have had to bear unnecessary additional costs arising from restrictive practices which are endemic in certain parts of business and administration, not least in the provision of services. It is a little frightening to realise the degree of restrictive practice on the services side, especially as this side is most removed from the ordinary marketplace and from normal rules of competition.
Those having to adjust to the modern situation are finding it painful. There is a headline on page 3 of today's Irish Independent where I am the subject of attack. I want to remind those who are adjusting, however slowly, to the realities of the modern world that what they are now doing and for which they certainly deserve credit is what they said a year or two ago did not need to be done and would never be done. Respectfully and rather diffidently I say that they have made a good start but there is still quite a way to go.
I hope this Bill will continue to encourage those changes because it is not in our economic interests in whatever field of endeavour we are operating that additional costs be imposed unnecessarily. The joy of the European Community is that if the Irish providers of certain services or goods are not prepared to provide them at a competitive rate others within the Community will have the right under the Community's rules to come here and provide them or to provide them from another member state without establishing here. When that reality sinks in as the Single Market comes closer it will have a beneficial effect.
The question of the definition of an "aggrieved person" and the comparison with that with a person who suffers loss was raised by Senator Howard and a number of other Senators. It was thought that the phrase "aggrieved person" is too broad but the contention was made in the Dáil that the phrase "aggrieved person" was too narrow. It depends on which way one looks at it. It is better not to define some of these matters too precisely. You find in practice that justice is more likely to be done if the court in the last resort has discretion, given all the circumstances of the case, to apply directives in a way that seems to it to do justice to the circumstances of the case.
I have had the experience myself in this field of trying for the sake of certainty to lay down precise definitions of things. In the 1978 Act to which I referred at some length this morning which I brought through the Oireachtas. I sought to define a monopoly in percentage terms and looking back on it after 13 years experience of the working of the Mergers Act of 1978, I was wrong. There was one obvious monopoly operating in recent years and because its market share was just below 50 per cent legally it was not a monopoly and I could not therefore, do many things I would have wished to do in the public interest. There were other problems like that which I think will not arise now.
Some will say the terms are too vague, but if one goes back to the Treaty of Rome of 1957, there are many phrases not defined in the treaty or in any of the directives or regulations supporting it but which have become accepted concepts in the European Community with widely-known implications. It is not necessary, and often it is not appropriate, in producing good law to define everything so precisely that you remove from the effect of the legislation those things that require control.
Senator Howard dwelt at length with the powers of the Authority to summon witnesses and require delivery of papers etc. and he seemed to imply that all these powers are new. If the Senator looks at the legislation relating to the present Fair Trade Commission he will find that the commission at present has all those powers. The kind of powers which he instanced and which were set out in the Schedule to this Bill and in other parts of it are the type of powers that apply generally to this type of body. Decisions by the Authority in respect of these matters are always open to judicial review if there is any question of the abuse of those powers. The power to raid a premises for papers can only be exercised if a warrant is obtained by authorised officers from a district justice where the district justice is "satisfied by information on oath that it is proper for him to issue such a warrant". For that reason it is not going to be issued lightly but will be akin to applying to a district justice for a warrant to search premises where the police suspect some major fraud is being carried out and proof depends on the possession of documents or records that only the company itself would have.
Senator Howard asked whether time limits will be laid down for the granting of licences or certificates. I dealt with that this morning. The Bill itself will not have such time limits but the Authority can lay them down or they can, if necessary, be prescribed by the Minister. To lay them down in primary legislation would be too inflexible because while many of these applications can probably be decided in the matter of a week or two there will be some complex ones that will take several months at least to decide and it would be wrong for something to go through because the decision could not be made within a period of two or three months or, alternatively, that an application be refused because the decision could not be made within that period. It is better to have some flexibility on that. If it has to be changed from time to time let it be changed by the Authority with the experience gained from the working of the legislation rather than having to come back to the Oireachtas.
Senator Honan raised the question under section 9 of whether an undertaking or an aggrieved person may appeal the grant of a licence or a certificate. The position is that an aggrieved party may appeal against the granting of a licence or certificate but there is no automatic right to appeal against the refusal of a licence or a certificate. This is deliberately done and I explained the reason at some length in the Dáil. Where a licence or certificate which is, in effect, an exemption from the normal application of the law is granted, third parties may well be prejudicially affected. Some probably will be prejudicially affected because someone is being licensed to continue some practice that is inherently anti-competitive and which but for the granting of the licence would be prohibited and unlawful. When in the opinion of the Authority the public benefit is greater by continuing a practice rather than disallowing it and when people possibly will be detrimentally affected it is only right that they should have a right of appeal to the court. On the other hand if the Authority refuses one of these applications, then no third party has been put at a disadvantage and the ordinary law prohibiting anti-competitive actions continues in force as far as that trade or business is concerned. Because it is a matter of commercial policy and commercial judgment rather than a matter of law, it seems inappropriate that the applicant for the exemption, having failed to get it from the Authority, having failed to persuade them that he should be allowed to continue in anti-competitive practice, should then go to the court, which is primarily seized of the power or duty of interpreting the law rather than of deciding on public commercial policy.
I hope I have covered most of the main points that were raised today. If there are other points of detail, we will have the opportunity next week, on Committee Stage, to go into them in more detail and I can answer more detailed questions that may arise if Senators wish.
In conclusion, I would like to reiterate that the importance of this Bill is not in the detailed control or regulation of particular businesses, trades or sectors, but that, hopefully, it will make a fundamental change to the outlook in this country on restrictive practices generally. By bringing in a general prohibition, subject to the right to apply for exemptions, lincences and so on, we will get rid of many things that are of no benefit to our economy and to our country, these are things which add to the costs of doing business and of living here. They make businesses carried on here less competitive than those in states where there is a more advanced form of competition law and where similar legislation has been in force for perhaps 20, 30 and in the case of the United States even more years.
From a macro-economic point of view, and not just from a narrow regulatory point of view, this Bill will have a profound effect, even if it takes a few years for its effect to be noticed. That is why people who realise how business and the regulation of business operates in other countries, and why it operates in that way, have welcomed this Bill and see good coming from it.
If amendments prove necessary, in practice, in a number of years time, they can be made. One of the advantages of the way this Bill is drafted is that a number of the detailed changes which might be necessary as a result of the experience of two or three years can be made without coming back to change the primary or fundamental legislation. They can be changed by way of regulation made by the Authority. For that reason I look forward with some confidence to the operation of this Bill. It will be a major plank in the economic rejuvenation of this country and in bringing about a healthier and more competitive atmosphere in which a greater and more vigorous form of economic activity can be carried on. This can only be beneficial to all of us, whatever the short term problems may be for some of those who are affected and who find it painful to adjust after many decades, if not centuries, to operating in a slightly protected environment.
