Seanad Éireann díospóireacht -
Wednesday, 7 Jun 1972

Vol. 72 No. 16

Restrictive Practices Bill, 1971: Second Stage.

Question proposed: "That the Bill be now read a Second Time."

Minister for Industry and Commerce (Mr. Lalor)

For centuries past, actions in restraint of trade have been contrary to the principles of common law, and from time to time this position has been reinforced by specialised legislation of very limited application. Comprehensive modern legislation to promote free and fair competition can be said to have begun in this country with the enactment of the Restrictive Trade Practices Act, 1953, which set up the Fair Trade Commission with power to inquire into the conditions which obtain in regard to the supply and distribution of any kind of goods. This Act was amended in 1959 to extend somewhat its scope to permit of more specific inquiries than were possible under the Principal Act, and to provide for special reviews of orders made by the Minister for Industry and Commerce and confirmed by the Oireachtas. The legislation has been very effective in achieving the purposes for which it was designed but after 19 years of operation I feel that it can be improved and extended to make it more effective in present-day conditions.

The Bill before the House, which consolidates the Acts of 1953 and 1959 to which I have referred, contains two major new provisions. Services, including professional services, are brought within its scope, and secondly, the investigatory work hitherto performed by the Fair Trade Commission will be carried out by a new officer described as the Examiner of Restrictive Practices. The feeling has been growing among those who are concerned with the efficiency of our economic operations that the promotion of competition should extend beyond the distribution of goods and that it was important that the provision of services should reflect the benefits of competition in the prices charged to consumers who may be industrial or commercial enterprises or the man in the street.

A specific recommendation to this effect was, in particular, made by the National Industrial Economic Council in 1967. The transfer of investigatory functions to the examiner will leave the commission free to concentrate on the task of conducting public inquiries and furnishing their reports to the Minister for Industry and Commerce. This will result in inquiries being completed more speedily than at present, a factor that will become increasingly important now that the scope of the legislation is being widened. The division of functions between the commission and the examiner is also designed to remove any feeling that the commission, because it has both investigatory and adjudicatory functions under the present legislation, may not approach inquiries in a completely detached and impartial manner.

The Restrictive Trade Practices Acts, 1953 and 1959, provided for the setting up of the Fair Trade Commission, which is continued in being by section 2 of the Bill, under a new name—the Restrictive Practices Commission. The First Schedule applies to the commission and embodies the provisions of the First Schedule to the 1953 Act, except that it omits those conferring powers of investigation which are conferred on the Examiner of Restrictive Practices instead. The Second Schedule relates to the terms and conditions of the office of examiner. The Third Schedule is an adaptation of the Second Schedule to the 1953 Act to take account of the increased area of operations brought about by the inclusion of services and section 3 provides that the commission and the examiner shall have regard to the restrictive and unfair practices listed therein. During the Committee Stage in the Dáil some Deputies appeared to be under a misapprehension about the significance of the Third Schedule. As I indicated at the time, and would again like to emphasise, the schedule does not contain a list of restrictive and unfair practices prohibited by law. The schedule, in fact, has no legal force of itself but merely provides useful guidelines for the examiner and the commission in the performance of their duties.

The commission, at present, operate towards the elimination of restrictive practices in two ways. They may publish fair trading rules which, in their opinion, represent fair trading conditions in the supply and distribution of any kind of goods. Section 4 of the Bill continues this power suitably adapted to apply to the provision of services as well as the distribution of goods. Fair trading rules have no legal force and it is not intended to give them any in the Bill. They do, however, establish codes of conduct which, if adopted by the interests concerned, could obviate the need for a public inquiry and I think it is desirable that the commission should continue to have the power to make these rules. The commission may also, at present, hold a public inquiry into the supply and distribution of any kind of goods, in the course of which they may investigate services only to the extent they are rendered in the course of carrying on any trade or business under investigation. Sections 5 and 6 of the Bill continue this power of public inquiry but an important change is that the commission may not hold an inquiry on their own initiative, but must do so on the recommendation of the examiner. The scope of the legislation is also widened to include all services other than banking, electricity supply, transport, and services provided by local authorities. It was argued in the Dáil that the bodies thus excluded were principally State or semi-State bodies, and that they should be subject to supervision and control as well as private bodies. I agree fully with this sentiment, but would like to point out that their exclusion from this Bill does not mean their exemption from control. The excluded services are controlled by legislation designed to meet their special characteristics and are the specific responsibility of other Ministers; and if practices in the provision of any of these services were considered to be contrary to the common good it would be a matter for the Minister concerned to take appropriate action.

Section 7 provides for the making of reports by the commission, and section 8 provides that on the basis of these reports the Minister may make orders which will not have legal effect until confirmed by Acts of the Oireachtas. Similar provisions are in the existing legislation, but I feel that the wording in the Bill will make for greater clarification of the intention behind the legislation by explicitly including unfair practices and unfair methods of competition amongst the matters on which the commission are required to report and concerning which the Minister may make provisions in orders. The existing legislation put the emphasis on the prevention or restriction of competition as matters on which the commission should report and these remain in the Bill as essential factors. I feel that in these days of intense competition from powerful financial interests when small independent traders are struggling for survival there should be no doubt that the legislation gives power to outlaw any practice or method of competition which is unfair or against the common good as well as those which are restrictive. I am sure that Senators will agree with me that the amendment of these central provisions of the legislation in this respect is essential in modern conditions.

Sections 13 to 17 provide for the appointment and functions of the examiner of restrictive practices. It is envisaged that he will investigate the supply and distribution of goods and the provision of services and furnish the commission with reports of his inquiries, and he may recommend the commission to hold a public inquiry under section 5, in which case the commission is obliged to make copies of his report available to interested parties. The examiner may also give evidence at an inquiry and may call and examine witnesses. As I emphasised in the Dáil I am very conscious of the need to make a careful selection for the post of examiner, and I shall take particular care to make a suitable choice. With the entry of the commission into new fields of activity, I shall, in any case where the subject matter of an inquiry seems to call for specialised qualifications, be prepared to add to its membership one or more suitably qualified members for the purposes of the particular inquiry.

Restrictions of competition and abuses of power by powerful firms in any country may be expected to affect business in other countries to an increasing extent as trade barriers are lowered, and I feel that the commission and the examiner should be empowered by law to take action. Section 14 empowers the examiner to investigate any restriction of competition or any unfair practice or unfair method of competition or any abuse of a dominant position by firms outside the State. Senators will appreciate that the exercise of his powers in the conduct of such an investigation must be confined to the area under the jurisdiction of the State, but it may be anticipated that a considerable amount of information will be obtainable from outside the State without the aid of any special powers. The Restrictive Practices Commission is obliged by section 11 to examine every report by the examiner of such an investigation and to give observations on it to the Minister, and may make recommendations as to what action should be taken. In addition, the commission is obliged by section 12 to study developments in other countries with particular reference to the operation of international firms. I think that it is necessary to confer statutory functions on the commission and the examiner in regard to these matters because of the existence today of international co-operation in the elimination of harmful restrictive practices. I believe that such co-operation will increase as we establish closer relationships with other countries in the interests of the economic well-being of our people, and the possession of statutory functions will endow the commission and the examiner with a status which they would not otherwise have in their dealings with people abroad.

The commission is also required by section 12 to study and analyse the effect on the public interest of methods of competition, types of restrictive practices, monopolies, mergers, takeovers, multi-national companies and market structures, and the operation of relevant legislation. I would like to point out that these functions of the commission do not involve the use of any powers of investigation, but their reports would be based on the knowledge and experience which they will gather in the course of their other activities, supplemented by the study of published material and their contacts with corresponding bodies in other countries and with international organisations.

I think at this stage it would be appropriate for me to comment on the implications of our membership of the European Economic Community in the context of restrictive practices legislation and, indeed, this aspect was raised when the Bill was before the Dáil. The position is that membership of the Community will not affect the powers provided in this Bill, and on our entry to the EEC the investigation and control of practices which distort or unfairly restrict competition in this country will remain within our jurisdiction. However, practices in this country which affect competition in other member States will fall within the jurisdiction of the European Commission and there will be an obligation on the examiner and the Restrictive Practices Commission to render any assistance required by the European Commission in the investigation of such practices. There will be a similar obligation on the other member states in regard to practices in their countries which affect competition here. Following approval by the Oireachtas of this country's accession to the European Communities it will be necessary to bring in legislation to enable us to honour the obligations of membership.

It is hardly necessary for me to remind Senators that promotion of free and fair competition, which may be said to have been pioneered in the United States during the latter half of the 19th century, has spread throughout the world and is now regarded as an essential economic objective in individual countries and in the European Economic Community of which we will shortly become a member. We cannot afford to lag behind other countries in adapting and extending our legislation so that the instruments which we are using for this purpose are suitable. I feel that the Bill which is now before you is worthy of support for the two reasons which I have already mentioned, namely, that it provides for more efficient investigation and control of restrictive and unfair practices and that it will extend the legislation over a wider field of economic activity.

The preparation of this Bill was already advanced when I was gratified to see that the Organisation for Economic Co-operation and Development had recommended to member countries that they examine their restrictive practices legislation in order to make it more effective and to extend it over as wide an area of economic activity as possible. This recommendation was one of a number made by OECD for the purpose of slowing down the rate of inflation and I mention it so that Senators will appreciate more fully that this Bill is indeed timely. I would also like to put before you my view that effective legislation of the kind which we are now considering will be all the more important for our country when we enter the European Economic Community. The door will be wide open to competition from nine other countries and we must be able to ensure, not only that obstacles to the increasing efficiency of undertakings in this country are removed, but also that the competition from abroad is fair.

I feel that I can recommend this Bill to Seanad Éireann without reservation.

Mr. Russell

I welcome this Bill. The Minister has just given a very exhaustive and helpful explanation. As he stated, it is now 20 years since legislation covering the unfair practices of traders was instigated under the Restrictive Trade Practices Act, 1953, and it is obvious that, in the altered circumstances, and with the changes in the years ahead, the Minister is acting quite wisely and properly to have our legislation up-dated for the benefit of the community.

This, I can say without exaggeration, is a very important piece of legislation, probably one of the most important to come before the Seanad, certainly in this session. We rightly have opted on the whole for private enterprise as a system best designed to suit our particular purposes and to give the community generally the best and most efficient reward for goods and services.

Private enterprise, like any other system, is open to abuse. It is, therefore, necessary that the State as the protector of the public bring in the necessary legal and administrative controls to prevent its operation contrary to the common good. The private enterprise system should stimulate competition with the reward, profit—sometimes an unpopular word—going to the company or individual who provides the best quality goods or services at the lowest possible price compatible with free and fair trading conditions.

If we accept generally the system of free enterprise, we have a double duty: first, to permit the manufacturer or trader or supplier of a service to operate in fair conditions free from the threat of joint national or international cartels, or combines which, under the guise of pro bono publico in the form of cut prices or services, force the small men out of business and thereby effectively eliminate the nuisance of local competition. Joint corporations do not work for nothing. Competition once out of the way will inevitably lead to higher prices and poorer and impersonal service. For this reason, I am very pleased to note that the Minister has emphasised the fact that not only is the Bill intended to counteract any unfair practices on manufacturers, traders or individuals, but he is also very concerned to note that within the manufacturing and distributing process there should be no unfair practices which would in the long term impinge against the best interests of the consumer.

I do not seek the reason for the change in the title of the commission in regard to the Minister's concern for the right of traders, especially small traders and manufacturers, to survive and flourish in a free enterprise society. The old name, the "Fair Trade Commission", suggested that it was prepared to act in the interest of the entire community which included the trader, particularly the small one as well as the consumer. The changed title, the "Restrictive Trade Commission", would appear to be detrimental to the manufacturer rather than beneficial. I should be glad if the Minister when he is replying would give the reasons why the change in title was suggested.

To me, fair trade means fair trade for everybody concerned in a particular service. This includes not only the consumer who is finally concerned in purchasing the goods but there is, in between, the whole distributive system between the manufacturer, the wholesaler, the retail trader and ultimately the consumer. All these people are entitled to equal consideration, having regard to the fact that if the small trader is put out of business by the giant corporation, the consumer will inevitably suffer. I would have thought that the description of the commission would have been a more accurate one in its present form of the "Fair Trade Commission". It is more applicable to the community as a whole than the suggested change of title, the "Restrictive Practices Commission".

Perhaps the Minister's reason for changing the title of the commission may be because in the new Bill it is proposed to include professional services. I do not see the reason for the change and would prefer the old title. A more accurate description of the commission might be to add the words "and services", "Fair Trade and Services Commission" instead of the new title suggested. The old title gives a more general description to what the Minister obviously intends the commission to do under the terms of the Bill.

Another vitally important point is the protection of the public against the abuses which can arise under the private enterprise system. When companies or individuals, seeking more for less, interfere with the normal competitive links between manufacturer and consumer or in the supply or cost of services to the public, obviously in the complex and changing circumstances of the second half of the 20th century, existing legislation—some going back nearly 20 years—needs to be up-dated to provide for current and likely future changes in the light of national and international trade. The Minister has emphasised this in his Second Reading speech.

The appointment of a new officer to be titled "Examiner of Restrictive Practices," I would fully support. It is a step in the right direction. The power outlined in the Bill appears to be adequate for the purpose. However, having regard to the substantial duties which he will have, provision should be made for the appointment for either an assistant examiner or sub-examiner, possibly on a regional basis. This would obviously speed up the process of dealing with complaints by the commission. We have had a number of examples in recent years in which delays in dealing with legitimate demands for price increases have caused grave disruption in certain industries. The flourmilling industry is an obvious example, where delays of up to one year very nearly caused a serious close-down of the industry and consequent unemployment.

Some provision should be written into the Bill, if not already in it, whereby the examiner, before referring the complaint to the commission for an inquiry, should satisfy himself, in consultation with the interests concerned, that an inquiry is justified. It is quite possible that the examiner, acting on a complaint from some individual or body, may decide that, on the evidence submitted to him, a public inquiry is justified; whereas if he was to consult with the interests concerned he might get a different viewpoint of the circumstances of the case. I make this point to ensure that not only will justice be done by the commission but that it will appear to be done by the public at large.

The Minister also mentioned in his speech that, following an investigation, the commission may decide to publish fair trading rules, "which will have no legal force". I do not see the reasoning behind this phrase. It would tighten up the legislation and the purpose of the Bill considerably if these fair trading rules had the force of law; not only would they rectify an existing complaint of unfair trading, distribution or unprofessional charges but they would also have the effect of discouraging such a practice, possibly in some other sector of the economy. As a preventative, apart from anything else, it would be helpful and add teeth to the Bill if the fair trading rules had the force of law.

The Minister mentioned, and everybody here would agree with his point of view, that the appointment of the examiner will require very careful consideration. Obviously it is not a job for the boys. I do not know what qualifications the Minister has in mind for the examiner and I would be interested to hear if he has formulated any views in this regard but obviously he will be a man of ability, integrity and complete independence; whose views will be accepted by the public, in the knowledge that he is acting completely free of any outside interference, with the desire of assisting the public and preventing any form of abuse under the private enterprise system. This position calls for a man of considerable talents and independence of mind. I wish the Minister every success in his choice for the right man because he obviously must be a very important individual.

Again I should like to repeat that the task for one examiner is far too great. Possibly under the terms of the Bill it is visualised that more than one individual would be appointed acting in the name of the examiner. I would like to suggest that in our changing economy, where everything is being speeded up and where decisions are wanted immediately, the examiner would require assistance in the form of sub-examiners, regional examiners or some other people of that calibre.

It is only right to point out that the great majority of manufacturers, traders and professional men are honest, hardworking people. Circumstances and standards have changed and not always for the better. The temptation to make a soft buck is certainly greater than it was years ago but it should be remembered that this attitude of mind is not confined solely to the trading and professional classes. Business today is difficult and not always rewarding. Our duty as legislators is to help and encourage the good enterprising trader because in so doing we are indirectly helping the public to enjoy good value and good services. If this Bill achieves that it will justify its introduction. In general, I approve of the Bill. There may be some amendments I should like to see to it but they would be amendments put forward to strengthen the Bill and not to weaken it.

In general, the public are well served by the trading and professional communities. There are niggers in every woodpile but they are not confined to the trading and professional classes. We are living in difficult, complex and changing times and it is proper that our Government, and we as legislators, should be alive to these changes. It would be completely wrong if for the sake of vote catching or popularity we did something in the name of the public that caused injury to any branch of the trading or professional sections of our community. I am quite certain that is not the Minister's intention and for that reason I should like to support the Bill.

Mr. O'Higgins

I will say only a few words on this Bill. I do not dissent in any way from the general trend of Senator Russell's remarks and welcome for the Bill but I should like some clarification on, and I should like Members to give some thought to, the possible implications of section 15 and the Second Schedule with regard to the powers of the examiner. I am thinking in particular of the position of professional people whose entire work is of a completely confidential nature. So far as my profession of solicitor is concerned, it is probably not necessary to point out that the work a solicitor undertakes is absolutely confidential as between the solicitor and his client. So far as the medical profession is concerned there is also the question of complete confidence as between the medical man and his patient.

Under section 15 of the Bill the examiner is entitled to authorise any person in writing, who then becomes an authorised officer, to require information about any particular field in which the examiner is conducting an investigation. Not only is he entitled to require that information be given but he is entitled to inspect books and records. Not merely is he entitled to inspect books and records but he is entitled to take copies or extracts of any such books, documents or records. This is the matter that troubles me somewhat on the question of the confidential relationship which exists so far as my profession is concerned—and I feel the medical profession would feel the same way—and which the members would insist absolutely on maintaining. Solicitors in many matters can give proper service to their clients only provided it is known, recognised and accepted by everyone that their relations with clients, their instructions from clients, their advice to the clients, their discussion with clients, are to be regarded as absolutely confidential. The same could be said of the other branch of the legal profession as well as the medical profession.

There is a safeguard of sorts written into section 15, but I do not think it meets the difficulty, to the extent that a person who is served with a notice by the examiner may apply to the High Court to get a declaration to the effect that the investigation should not be carried out by the examiner. I do not want to achieve a situation, either as regards my own profession or any other profession, where an investigation will not be carried out but I want to have something written into the Bill which will ensure that only information which is absolutely necessary to the examiner in relation to the investigation he is carrying out need be made available.

That may be implicit in subsection (1) of section 15 but I have to bear in mind that it is not the examiner himself who will be the type of person that the Minister has foreshadowed but it will be some unknown person who will be authorised in writing by the examiner to make the inquiries on the spot. I believe it should be written into this Bill that (1), only information which is essential to the examiner in the conduct of his investigation can be required and (2), that any information which is given will, all along the line, be treated as absolutely confidential.

One of the rules in the Second Schedule has a bearing on this in so far as the examiner's investigations are concerned but I do not think it goes far enough. In No. 8 of the Second Schedule it is provided:

that no person shall disclose information available to him through being present at an investigation held by the examiner under section 14.

Then it states that that general rule does not apply to a communication made by the examiner, or an authorised officer, in the execution of his duty.

The point I want to make to the Minister is that that prohibition should apply to the examiner and to an authorised officer except, so to speak, that it is going a step higher up the channel. It is leaving it too wide if an authorised officer is himself likely to be in a position to interpret what does or does not lie within the execution of his duties. I do not know to what extent this particular problem has been considered by the Minister or his Department, or to what extent it may have been discussed in the Dáil because I did not read the Dáil debate on this particular Bill.

The Minister will appreciate that it is the kind of matter likely to cause concern both to the legal profession and to the medical profession. I say that not in any spirit of hostility towards the Bill. I say it not with any idea of trying to get imported into the Bill any provision whatever which might make the Bill more difficult to operate or in any way clog the smooth carrying out of an investigation by the examiner. However, I think it is a point of view that is legitimate, particularly with regard to professional men whose profession is founded to a great extent on the question of confidence. It is of the utmost importance to them that it should be made quite clear in the terms of the Bill that there will not be any question of extracts from confidential files or confidential information on files being copied. This information may concern particular clients, and might not be or could be relevant to an investigation.

Mr. Gallanagh

I wish to ask the Minister a few questions on the matter of safeguarding the public. For example, is this Bill intended to protect the ordinary purchaser of a house? He may see written: "For sale, so much net", and the unfortunate man may later find out that he has lost his Government grant because it says on the board: "Net price" instead of "Gross price". This is an unfair practice and I wonder if this sort of thing is covered in the Bill? Is that considered to be a restrictive practice and something to be dealt with?

For example, there are shops that sell goods such as fur coats without labelling them as "rabbit coneys". There is nothing on it to say that it is a "coney": the public are led to believe that it is a fur coat. The same can be said of frocks and other garments that do not state the content of wool in the material. Are these restrictive practices under this Bill? There are shoe manufacturers who sell on the main street under trade names. They put the name of a large store on the shoes at night and deliver them early in the morning as the same shoe at a cheaper price, because of the large amount being bought. Is this a restrictive practice?

In some bundles of peat briquettes there may be two fewer in each than those sold in another shop. Some butter manufacturers make up 14 oz. packets and print "14 oz." on the packets, but the housewife may not notice this and is often led to believe that each packet contains 1 lb. Are these restrictive practices for the purposes of this Bill? These are the sort of practices about which I am concerned. I know it may be said that these are not covered in the Bill and that they may be appropriate to the Trades Description Act.

Mrs. Farrell

There is one comment I wish to make on the Bill. In the Minister's introductory speech he said:

The Commission are also required by section 12 to study and analyse the effect on the public interest of methods of competition, types of restrictive practices, monopolies, mergers, take-overs, multi-national companies and market structures, and the operation of relevant legislation.

I should like to ask what will happen when they have examined these types of take-over? Recently in this country we had a series of mergers and take-overs in the drapery and grocery trades. The type of take-over has caused great concern to the members of the grocery trade. When the commission examine this and find that it is not conducive to good trading can the Minister then take legislative action to undo this type of monopoly situation? Is it too late, or is there legislation that can prevent this?

Can the Minister examine it and say: "You may not do this"? It can be done in other countries where this type of take-over is examined and is found to be contrary to the public good. I know that this is causing great concern among traders generally. I should like to know when the commission have examined it what can they do about it? It states here that they have no power in law to do anything but merely to examine it. Will they just say: "It is not good", and do nothing further.

Minister for Industry and Commerce (Mr. Lalor)

This Bill has been generally welcomed. Indeed, Senator Russell summed it up by saying that if he had any criticism of the Bill it was because it was not exhaustive enough.

In relation to restrictive practices, I have gone as far as I can in the Bill. I propose to give the new Restrictive Practices Commission as much power as possible. Senator O'Higgins drew attention to the fact that it is quite possible, studying section 15, that the authorised officer on behalf of the examiner might appear to have too much power. It is again satisfying from my point of view that this Bill has been so widely welcomed by the House in such a widespread manner. It is quite an extensive and exhaustive Bill. One of the main purposes of the Bill is that it gives the power of the old Fair Trade Commission to the new Restrictive Practices Commission to investigate fair services with fair trading, and also the separation of the powers of the commission from the powers of the examiner.

At this stage this legislation is much needed. Senator Russell drew attention to the title of the new commission and questioned whether I was going too far in the general changing of the title of the old commission. He suggested it might have been called the Fair Trade and Practices Commission. I would not quibble with him on that. It is a matter of opinion. When introducing this legislation, I endeavoured to spell out that although I did not attribute the reason for the change of title to the change of the functions of the commission, the fact remains that the commission would be taking on the power of investigating services including professional services with the old idea of investigating fair trade. In that regard I can appreciate the Senator feeling that in the proposed commission's title is the implication that when the commission start investigating some sector of trade or service which has been condemned in so far as it is accused of being restrictive in some shape or form, they will be hampered before the inquiry gets off the ground.

As I indicated in my opening speech in connection with similar provisions in the existing legislation, I felt that the wording of the present Bill will make for greater clarification of the intention behind the legislation by explicitly including unfair practices and unfair methods of competition among the matters on which the commission will be required to report. The existing legislation put the emphasis on the prevention or restriction of competition as matters on which the commmission should report. This Bill extends it to outlaw any practice or method of competition which is unfair or against the common good as well as those which are restrictive. Anybody could find fault with the naming of the commission. It is fairly descriptive and from that point of view fairly justified.

The Senator also talked about consultation. He said that the Bill should provide that before recommending that the commission should hold an inquiry the examiner should consult with the interested party. It is envisaged that the examiner will keep in touch with those with whom he is dealing and that he will normally make this his practice, in order to prevail on people to drop any unfair or restrictive practice which they are carrying on. I visualise that it is only when he is satisfied that he cannot prevail on the perpetrators of the restrictive practice to change their ways that he will pass the problem on to the Restrictive Practices Commission to deal with it. The dangers of his recommending inquiries unnecessarily to the commission are small. It would not be necessary or appropriate to impose a statutory obligation on him as an inquiry could be undermined by those opposed to it alleging that they had not been adequately consulted.

The type of person that I visualise will be appointed as examiner would be a rational being who would not go to the trouble of taking an unjustifiable case to the commission where the commission would ultimately find against him or find that the complaint he had brought to the commission to investigate would not be justified. The history of the operation of the Fair Trade Commission is one of general acclaim, but from time to time there have been criticisms of their recommendations and findings. It would be a foolish examiner, and certainly not the type of examiner I would be hoping to appoint arising from this Bill, who would endeavour to take something before the Restrictive Practices Commission that would be unjustified.

Senator Russell asked why should the fair trading rules not have the force of law. This is a justifiable comment. Fair trading rules are suggested as being a guideline. The commission can and have in the past suggested fair trading rules for sectors of trade as a general guideline for them. There never has been a statutory obligation to abide by them, but if any trader or sector of trade, or now service, does not abide by the overall rules, then the rules will act as a guideline for the examiner, in the context of the new legislation, to enable him to take somebody who does not abide by those rules before the commission with a view to asking the commission to make recommendations to the Minister. The fair trading rules could not have the force of law because an inquiry would have to be held and conducted by the Restrictive Practices Commission and the commission then would have to make recommendations to me as Minister. I would then have to make an order arising from those recommendations and that order would have to be confirmed by an Act of the Oireachtas.

In relation to the subject matter of any investigation which the present Fair Trade Commission carry out, one could say that the regulations made arising out of the order, which in turn arises out of the recommendation made through the Minister by the Fair Trade Commission, become the fair trading rules in that instance. Fair trading rules, as such, cannot be given the force of law for that same reason. This procedure whereby the recommendations have to come through the Minister is part of the procedure which is necessary for constitutional reasons to protect the rights of the persons who would be affected by such legislation. This is the reason why the trading rules, as such, have not the force of law at present and I am not proposing to take power in this Bill to change that.

Senator Russell visualised a situation whereby the examiner would need an assistant. There is no reason why the examiner should not have to deal with the correspondence and to deal with the subject matter or complaints. As Senator O'Higgins mentioned, he will need authorised officers, under section 15, to carry out investigations and inspections of records.

The examiner will have to make serious decisions and it would not be proper that they should be made by other officially appointed personnel. It is difficult to obtain the ideal type of man and I am taking power under the Bill in the event of the examiner becoming ill or incapacitated, of having the power to appoint an examiner in his place temporarily. It is not visualised at present to have more than one examiner.

Regarding Senator O'Higgins's comments on section 15, I should like to state that this kind of power has been held by the Fair Trade Commission up to now in relation to fair trading and in 19 years of operating the same provision in relation to the commission no difficulty of that sort has arisen. I anticipate that Senator O'Higgins will say: "This is a different type of situation. There is the question of confidentiality of papers." Anybody whose books or records are examined in the context of fair trading would not be concerned with anybody else whereas inspecting documents in an employer's office or inspecting documents in a doctor's office could affect an innocent third party.

It is a remote possibility that an authorised officer would want to see confidential information relating to a client of a solicitor or doctor. If this happened, the solicitor or doctor could refuse and appeal to the court under subsection (2), which is not in the existing legislation. This was specifically included in this legislation here to anticipate something more serious.

Built into section 15 are such phrases as "for the purpose of obtaining any information necessary for the exercise by the examiner of any of his functions under this Act, an authorised officer may..." In paragraph (b) the emphasis is to give an authorised officer "such information as he may reasonably require in regard to any entries in such books". In (e) we have the same thing "which an officer may reasonably require". Section 15 (5) spells out that: "...the authorisation of an authorised officer shall indicate the matters in respect of which he may act under this section."

All that is there with the express purpose of preventing the type of situation which Senator O'Higgins fears. I would be fearful of that type of situation and I would hope that the examiner would be mindful of this too. There should be clear-cut distinction in the authorisation which would be given to the authorised officer by the examiner, spelling out exactly what function he has in relation to the examination of entries in books, documents and records.

The type of restrictive practice which might be investigated in this context should not involve the possibility of the authorised officer needing to see individual patients' or clients' files or documents. This is one of the problems concerning legislation of this nature. It is easy to imagine some fiendish authorised officer seeking to assume more power than was originally given him, but one would have to realise the type of situation even before the affected party would have resort to section 15 (2), that is, going to the courts.

One would visualise the type of situation whereby he would pick up his phone and ring for the examiner and say: "You have an officer here who is going beyond his powers and I ask you to call him off my back." That type of operation would be effective before the need to use section 15 (2) arises. The qualification about what he may reasonably require restricts the authorised officer in this regard. His authorisation would need to indicate the matters in respect of which he would act under this particular section. That is also a safeguard.

Senator Gallanagh made a number of points. He wondered what would be regarded as a restrictive practice. The type of abuse mentioned by the Senator would be dealt with under consumer protection legislation, not under this Bill. Some of the abuses mentioned are currently being dealt with in an order relating to prepacked goods, a draft of which was published last month. The order will be made shortly. The Senator gave an example of a packet of butter marked 14 ounces where the consumer thinks he is buying a pound of butter. The person selling the butter is selling it quite legitimately but he is leaving it to the imagination of the consumer to assume that he is getting more than he actually does. I am preparing this order to try to ensure that we will have regular amounts and that the contents of a package are shown quite clearly on the outside. I hope to make an arrangement whereby there will be only a half pound or a pound with no intermediate stations which have the effect of deceiving the consumer.

Senator Farrell raised a point as to what happens following an investigation under section 12. She inquired if I can act on reports under this section. Specific powers are provided for the investigator under section 5 and also under legislation, which I propose to introduce, to provide for investigation of and prohibition of mergers and take-overs. The Senator inquired if I can deal with mergers or take-overs where it is reported to me that they are not in the national interest. No, not at present. I have announced publicly that legislation is in an advanced state of preparation to give me that power. I hope the power conferred on me under that legislation will be such that I will be able to deal with mergers, take-overs or the creation of monopolies which have occurred already. I have asked the Parlimentary draftsman to endeavour to speed up the provision of this piece of legislation which is very much needed.

On the other hand, let me say quite clearly that one of the difficulties in this regard is that there are a number of mergers which are necessary and need to be encouraged. For example, co-operative merging in the creamery industry is very necessary. Any mergers which interfere with the operation of fair trading and the overall benefit of the State are the type of mergers I am anxious to get at. I have endeavoured to deal with the points raised. I appreciate the manner in which the House has welcomed this Bill. In introducing this Bill in the Dáil I said that it was the most important piece of legislation that I had, as Minister for Industry and Commerce, had introduced. It is extremely valuable and should go a long way to protecting the public interest.

Question put and agreed to.

Acting Chairman (Mr. McDonald)

Next Stage?

Tomás Ó Maoláin

Is there any objection to taking the remaining Stages now? There seems to be general agreement on this.

Mr. O'Higgins

I do not want to hold it up nor, I am sure, does Senator Russell. The only difficulty is that, with the best will in the world, it is unlikely that the Minister will entertain seriously suggestions for amendments on Committee if we decide to take the Committee and remaining Stages now. There are a few points I should like to raise with the Minister on Committee. If there was an indication from the Minister that, if he felt that these points warranted further consideration, we would then have the Report Stage another time, I would be quite agreeable to have the Committee Stage now.

Acting Chairman

It is a matter for the House.

Mr. Lalor

That is agreeable to me.

Mr. O'Higgins

We might go on to the Report Stage afterwards, but let us take the Committee Stage first.