Gas (Interim) (Regulation) Bill, 2001: Committee Stage.

I welcome the Minister and his officials. I realise the difficulties this meeting has caused for many Members and I thank those who have come along. I know they are anxious to deal with this legislation.

SECTION 1.

Question proposed: "That section 1 stand part of the Bill."

I wish to ask about something that was mentioned before but not elucidated on. This is the Gas (Interim) (Regulation) Bill. Why is the word "interim" used? Why is this a temporary measure? Why have we not got the gas regulation Bill that has long been promised? This seems to be another stop-gap effort to put in place some temporary regulation in the gas industry. Why have we not got a full Bill rather than an interim one?

Before I address that important question from Deputy Higgins, I should like to thank the committee for meeting this week when other colleagues are busying themselves in the glorious Cotswolds. If they are not in the Cotswolds, they are in their armchairs. I appreciate the presence of those who attended. If I have made myself unpopular with that statement, I am grateful to the Chair for facilitating me.

This is a very important Bill. It is important that we get this Bill through in the lifetime of this Administration, which is coming to a close. On Second Stage, I attempted to address the matter raised by Deputy Higgins. I said at the time that the timeframe available in terms of dealing with this legislation was such that it had to be an interim Bill. It was not possible to be as comprehensive as I, Deputies Higgins, Stagg and other Deputies would have wanted. However, in the immediate aftermath of our dealing with this Bill, when it is up and running, I will address the issue of regulation in this sector in a comprehensive fashion. The result of that will be before the Houses in due course. I agree that should be done as expeditiously as possible.

Question put and agreed to.
SECTION 2.

I move amendment No. 1:

In page 4, subsection (1), line 35, after "undertaking" to insert "but does not include any natural gas in a pipeline under the control of that undertaking."

The purpose of this amendment is to clarify that the definition of "storage" in section 2 does not include line packing, which is when pipeline operators stock extra gas in a pipeline by increasing the pressure in the pipeline. Line packing is an important facility used by pipeline operators to balance the system; that is, to ensure the overall amounts of gas put into and taken from the system are the same each day. If the definition in the Bill is not amended, other gas undertakings would be entitled to access the facility, creating difficulties for the transmission system and limiting the ability of transmission system operators to manage the daily operation of the system. The amendment has been requested by Bord Gáis, the operator of the national transmission system and I propose that it be accepted.

Amendment agreed to.
Section 2, as amended, agreed to.
NEW SECTION.

I move amendment No. 2:

In page 5, before section 3, to insert the following new section:

"3.-Notwithstanding any other provision of this Act, the Minister shall not make an order appointing a day to be the appointed day for the purposes of this Act until legislation has been enacted providing for-

(a) comprehensive accountability of the Commission and other public enterprise regulators to the Minister and to Dáil Éireann, and

(b) the transfer of any share (other than one owned or to be owned by or on behalf of employees) in the Board and in other public enterprise utilities to a public sector holding company”.

This amendment is an attempt to address the fact that the Minister for Public Enterprise has started from the wrong point and is going in the wrong direction with this Bill. The mistakes that were made in the regulation of other sectors are being compounded and the resultant democratic deficit is not being taken into account. Those appointed during the regulation of the electricity and telecommunications sectors were independent of public representatives, leading to the transfer of power to people outside the democratic system. As a democrat and as one who made a similar mistake when in office, a mistake which should not be repeated, I object to such appointments. If we cannot find a mechanism to make supposedly independent individuals accountable to the people, there will be a major flaw and a reduction in democracy. I ask that we do not proceed with this interim measure until we have found a mechanism, as I have suggested, to make accountable those to whom the people's power is being given. I have said repeatedly, and I am sure members of the committee are fed up listening to it, that we are the only people in the history of humanity to have voluntarily handed over large chunks of power, held in trust for the people, to others who are not accountable in any way.

I am concerned about the effect of our method of introducing and regulating competition. The best example of this is the electricity sector, for which we appointed Mr. Tom Reeves as regulator - a good public servant with a long history of public service. The effect of regulation is supposed to be lower prices and a greater choice for the consumer, but 2,500 jobs were lost in the electricity industry and prices increased dramatically for the vast majority of consumers. The failure of our introduction of competition and regulation in the electricity sector is being examined by the European Commission. More price increases have been promised, or perhaps I should say threatened, by the regulator, but he cannot be blamed for the policies he was handed by the Minister. He has tried to excuse the crazy situation whereby regulation led to price increases by saying that prices were not high enough for competitors to make a profit. In other words, consumers were charged more money to ensure profits for new entrants to the market. If that is the effect of regulation and competition, I do not want it. I am sure the people we represent, who have to pay higher prices, do not want it either.

I have no evidence that such price increases will occur in the gas sector, but I am concerned that another chunk of the power held by the Minister of State, Deputy Jacob, will be handed over to Mr. Reeves. We will lose the right, under the democratic parliamentary system, to question him. We should not proceed with the regulation of the gas sector until we define a system whereby the regulator can be made accountable. I understand why the Minister of State is keen to proceed with this interim measure, but I ask that we do not proceed until we have put our house in order. We should be certain of the effect of this Bill.

One cannot be certain of the success of a measure, such as that being introduced, until it has been tried. While there is a great deal of truth in Deputy Stagg's remarks, the reality is that the last 27 Dála have surrendered power, control and autonomy in a range of areas. The basis on which State-sponsored bodies have been established, since 1927 when the ICC and the ACC were set up, is that bodies involved in commercial or quasi-commercial activities are taken from the control of Dáil Éireann, particularly in relation to their day-to-day activities. Deputy Stagg's point could have been made with great validity in 1927, but I am not sure that it can be similarly made in 2002. This Bill proposes to change the nature of the relationship between the House and a State-sponsored body, but no Minister can control that relationship.

He is the regulator.

That is true when there is a market, but we have gone past that stage. It may be argued that we should not have gone past that stage, but we cannot turn back the clock. Deputy Stagg highlighted the degree of accountability between regulators and the Houses of the Oireachtas, which is a significant issue. Heavy handed action was needed on the part of this committee to establish the supremacy of this Parliament when difficulties were encountered with the Director of Telecommunications Regulation. The successor to this committee in the incoming Dáil will have to establish a regular and audited reporting relationship to satisfy the concerns enunciated by Deputy Stagg.

The broader argument about the opening of markets is a dead one, as society has moved on, whether we like it or not. I have some doubts about absolute untrammelled deregulation. Adam Smith was right when he said in the 18th century that a group of businessmen will always conspire against the public interest. I do not suggest that we have a free and untrammelled market, but we cannot go back to a regulated market.

We should put our energies into examining how efficient and effective the oversight body of this committee and its successors will be. Deputy Stagg is correct when he suggests that a great deal of resources are needed, but resources are a matter for the 29th Dáil, when it is established. It will have to wrest control of its own activities from the Executive. I know the Whips have discussed the budget of the Houses and I hope the Dáil will become the master of its affairs.

While Deputy Stagg is correct that there has been a different set of circumstances to those we face, we cannot turn back the clock. I am not suggesting that Deputy Stagg wishes to impede this Bill because the Minister has made a cogent, focused and valid argument on the issue. The steps here are not revolutionary, particularly in terms of regulation, but the valid points Deputy Stagg made are something of which the Dáil has to take control by resourcing the next incarnation of this committee.

Deputy Stagg's opinions of regulation and regulators are well known and he has articulated his views and sentiments many times in many fora. Many agree with him. There has been a voluntary erosion by successive Ministers and Governments of powers of which I have certainly been critical. Some of them come to mind, but I will not embark on a discussion on them now. Unfortunately, the effect of what Deputy Stagg proposes in this amendment would be to delay the introduction of the Bill's provisions for a considerable time and that is something we can ill afford. It is noteworthy also that his proposals extend beyond the scope of this Bill, into sectors other than gas.

The amendment addresses the two issues of accountability of the commission and shareholding in Bord Gáis and other utilities. In relation to accountability, the Minister for Public Enterprise published a document in March 2000 setting out policy on governance and accountability in the regulatory process. The document took into account the Department's experience in this area and the wide-ranging views expressed in response to a discussion document on this subject, issued the previous year. It is recognised that there is a delicate balance to be struck between ensuring accountability of regulatory authorities and their independence. These objectives are achieved in the framework this Bill will establish, as well as through the Electricity Regulation Act, 1999, by clearly defining the duties and responsibilities of the Commission for Electricity Regulation and by making the regulatory decision making process transparent.

The accountability of the commission is further ensured through the provisions of the Schedule to the Electricity Regulation Act, 1999, which established the commission in the first place. These oblige the commission to submit, on an annual basis, its accounts to the Comptroller and Auditor General. The audited accounts, along with the Comptroller and Auditor General's report, must be submitted to the Minister within six months of the end of the relevant financial year and the Minister is required to lay copies of these documents before each House of the Oireachtas. The commission is also required, under the provisions of the Schedule, to account for its performance of its functions before a joint committee of the Oireachtas whenever so required by that committee. Matters relating to the resources available to the committee are outside the scope of this Bill.

These obligations will continue to apply to the commission in regard to both its electricity and natural gas functions following the enactment of this Bill. The idea of transferring shares in Bord Gáis and other utilities into a public holding company is certainly an interesting one, but the effect of the proposal to delay the transfer of regulatory responsibility for the gas sector to the commission would serve no useful purpose, particularly in circumstances where regulatory functions in other sectors have already been transferred to independent regulators. Such a delay would have the effect of continuing in existence the conflict of interest, between the Minister's functions as regulator of the gas sector and as shareholder of Bord Gáis, which this Bill is designed to address. The early establishment of independent regulation of the gas sector is necessary to underpin market confidence and, accordingly, I do not propose to accept Deputy Stagg's amendment.

The reason for bringing in independent regulation is that the Minister is the shareholder and therefore cannot regulate the relevant industry. The Minister has told us that it is her intention to sell Bord Gáis, perhaps not immediately, but it is certainly the long-term position of the Government. I have that information with me. I see eyebrows being raised by the Minister of State's officials at the idea that it could happen without their knowing about it. Politicians sometimes do things without telling everybody.

The Deputy obviously has a more intimate relationship with the Minister than we do.

I asked her a question, she answered and that is how I have the information. Maybe she was not briefed before she responded, but her intention was clear.

Technically the reason for regulation is that a Minister cannot regulate himself or his company, but if it is the intention to sell the company, why is that not done first to dispense with the need for regulation? In fact, the Department of Public Enterprise has a long-standing agenda, regardless of who the Minister is, and that agenda is to sell the companies while getting rid of the regulation as well so that the total control will be out of the democratic sphere. There is no doubt about that. I spent a few years at the Department and argued and fought against it as best I could and we might have won if we had been there long enough. We were not and we now have this very clever trick of getting rid of the whole lot by getting rid of regulation before selling the company. If it was sold first there would be no reason to get rid of the regulations. I suggest that something other than that should occur which is why I have tabled this blocking amendment to the legislation.

As the Minister of State has quoted from my Second Stage speech, the long-term objective should be public control of strategically important utilities. It is outlandish and crazy that our telecommunications can be controlled from Japan despite them being of strategic importance. We actually do not know where they are controlled from because the companies involved will not tell us. They make decisions about telecommunications here with the result that the Government is now in the process of re-nationalising part of the industry to try to get broadband to the regions. They are using the local authorities as the vehicle to do that because the privatised companies controlled from New York and Japan have no interest in bringing broadband to Kilkenny or Mayo as there is not enough profit in it. They would not do it even when the Minister offered them a £26 million bonus to do so. They simply want to deal with the populous area around Dublin and the east coast. That is the effect of losing control of strategically important utilities and services. It will come full circle, be assured of that, and nationalised industries will have to be established to provide services within my lifetime - and I am getting fairly croaky. I expect to see re-nationalisation of the electricity industry, like we are seeing in the United States of America, because private sector competition is breaking it into pieces like sharks in a feeding frenzy. They have failed in one of the biggest cities in the world, New York, to provide electricity that will stay on all day, never mind all night. There are constant blackouts there and, as a result, the city authorities are bringing the electricity industry under social control. They do not use the word "nationalisation". That is occurring in the capital of the capitalist system. It will happen here.

What is being proposed is bad for Ireland. It is the first step to privatisation, and it will key up the company for that step. If the majority view is that the company should be sold, sell it, but keep regulation within a democratically accountable system. As an alternative, I suggest that the long-term objective should be to keep the companies under social control in Ireland while allowing them the commercial freedom they are denied because Assistant Secretaries in the Department second guess their boards and management. They should be removed from that influence and placed in holding companies which would be joint public private bodies allowing them to raise the funds they need for investment without breaching EU regulations. I have proposed this system before and it would work. Having examined it, we found it would allow us to retain national control of these utilities and continue to have regulation.

Deputy Roche stated that one cannot be sure of the effect of a measure until one has tried it. We tried it with the ESB and the result has been higher prices across the board when they were supposed to fall. We tried it with telecoms and the result to date has been that we cannot get broadband rolled out into the regions because the companies refused to do it and told the Government to get stuffed. We should not compound the mistake by continuing along this road. While I am aware that the Minister has stated a major review of the next step in the process is under way, a serious review of the policy is needed.

I do not believe there is a majority in this room in favour of my view that to proceed along the lines proposed would, without doubt, make Tom Reeves the most powerful man in Ireland. More power will be vested in him than in the Taoiseach and effectively he will not be accountable to anybody. I am not criticising him. He does not want to be unaccountable and having worked with him, I found him to be an excellent public servant. However, this committee is not capable of addressing the complexities of the issues he will address.

To deal with Tom Reeves effectively and try to make him accountable would require a specialist committee of the House to be set up with the kind of resources which have been available to the Committee of Public Accounts. This is not mentioned in the Bill which contains nothing more than a requirement for him to appear when we send for him. The reality is that we will send for him, he will sit down opposite and I - and other members - will rush down from my busy office and, because of the lack of resources at my disposal, I will have to try to think of something to ask him.

The Deputy's argument relates to the resources available to the committee.

I agree with the Deputy 110%, but one would need a specialist committee to cover such a broad area. I believe that everyone here, including the Minister, understands my point, so I will rest my case.

Although Deputy Stagg's comments have more than a grain of truth to them, effectively his amendment seeks to overhaul the whole system, which is a subject for another day. The Minister of State pointed out that the 1999 Act obliges the regulator to produce accounts on an annual basis, appear before and address the committee and answer questions. Irrespective of what anybody says, the regulator is ultimately independent, untouchable and not accountable to anybody. Therefore, while the Minister may make representations to him, at the end of the day the regulator rules. We have completely divested ourselves of independent and autonomous power in a huge area of national importance and given it to one individual or, in some cases, to a commission. The Communications Regulation Bill, for instance, creates a commission consisting of three people.

While it is possible for us to bring in the regulator and make the strongest possible arguments about fundamental flaws in the policy, postures or positions he has adopted, he is entitled to totally disregard them. As an illustration of the problem, the committee chairman. several members and I met members of Aer Lingus, Aer Rianta and Shannon Development in Shannon on Monday last. The issue of airport charges arose during our discussions with two of the groups. When the Aviation Regulation Bill, 2000, was going through the Houses, we warned that airport charges would create a difficulty and that, by using of the word "may" rather than "shall", we would find ourselves in a position in which the regulator could make a decision which would place both Cork and Shannon airports at a considerable disadvantage. We have been vindicated by the regulator's decision on airport charges at Dublin Airport which are considerably lower than those which apply in Shannon and Cork airports despite the fact that Dublin Airport has a throughput of 14 million passengers a year. As a result of placing Shannon and Cork airports at a considerable disadvantage, Aer Rianta is taking the regulator to court to try to impose some common sense and inject some reason into what he is doing.

We also had the situation, to which Deputy Roche referred, in which the Director of Telecommunications Regulation refused point blank to come before the committee, even though the spirit of the legislation would suggest this is required, and then having to be forced in a heavy handed fashion to appear before the committee.

Many decisions are being taken about electricity which are incomprehensible and lack rationale and over which we have no influence. We have thrown away many of our powers. With regard to the National Roads Authority, which also has a great deal of authority and independence in terms of the allocation of grants, at least the Road Traffic Act, 1993, enables the Minister for the Environment and Local Government to instruct it to give priority to particular projects. This is not provided for in this legislation and as a result the position is progressively deteriorating and will have to be revisited.

I am not arguing against the principle, in fact, I share the concerns expressed by Deputy Stagg about regulators, the fact that we are entering a new area and his very specific concern about the capacity of an Oireachtas committee to fulfil its role. In this context, there is an argument for providing very powerful back-up for the committees to ensure one does not have a heavily pressed Front Bench spokesman for an Opposition party being forced to salami slice his or her day by having to run to a meeting in an effort to give due attention to a variety of matters while looking after his or her constituents at the same time. It is an impossible mix which makes a cogent argument for introducing very strong supports for the committee.

Deputy Jim Higgins is correct in stating that the whole process of creating regulators as an alternative to completely open markets is in the public interest. Not one of us really wants them because we would be visited by the doomsday scenario implicit in Deputy Stagg's comments. The reality is that regulators are there to look after the public interest while our task is to govern how well they do it. This point would be better addressed by the incoming Dáil.

Deputy Stagg made the valid point that it is better to solve things up front because to solve problems afterwards creates a patchwork. Our experience in the area of regulation is not sufficient to deal with the matter. As Deputy Higgins pointed out, we had the problem with the Director of Telecommunications Regulation who believed she should not appear before the committee. However, having been persuaded by the chairman and my colleagues on the committee to appear, the matter is being resolved satisfactorily.

The points made by Deputy Stagg would be better addressed by committing greater resources to the committees, including a very significant improvement in numbers in the secretariat and the appointment of professional advisors assigned to each on a full-time basis. This is the way in which to regulate the regulators and it goes back to the oldest question in the book, that is, who guards the guardians. Nowadays, the question is who regulates the regulators. The answer should be that Dáil Éireann is the ultimate regulator, because we are answerable to the people. We are their board of directors and, as such, we should have the necessary resources.

While the arguments of both Deputies are valid, instead of blocking the necessary legislation we should examine how to resource committees in the future to empower them to carry out their task. The Minister's points are completely valid which is illustrated by the fact that nobody is arguing in principle against what he is trying to achieve.

What I am really asking is that we do not compound the mistakes which I was part of making. The other issue which has arisen is that the courts are becoming the regulators for the big players only. They will not regulate for the small players because the customers at the bottom end of the markets will not be able to go to court. Until now, we had accountable regulators. For example, the current regulator, the Minister of State at the Department of Public Enterprise and Transport, Deputy Jacob, is very accountable because we can nail him in the Dáil and at this committee. That option will no longer be available to us in this form. We also had access to his Department as well from this committee and that was appreciated. It has been acknowledged that there are concerns and I urge that we do not proceed until they are addressed or they will be compounded.

There is nothing in this Bill regarding future plans for BGE. I had discussions with the chairman and board members with regard to the company's future and the ongoing management of BGE. I have sought and received the details of planning for that excellent company into the future and no decision has been taken as to the future of Bord Gáis Éireann.

Deputy Stagg has made some very cogent points and they are not going unheard. Deputy Higgins and Deputy Roche are virtually at one with him and I have no great argument with those points either. I have a responsibility to ensure that the conditions prevail in the gas sector to provide investor and market confidence. Independent regulation is one such condition.

The recent consultation paper issued by the Taoiseach seeks to address in a global way the issue of regulation and the purpose of this consultation is to ensure that the system of regulation adopted here will be the most effective and appropriate to the needs of consumers and the market. The consultation process is a comprehensive one and its result will affect all regulators in all sectors. The results of this process will be incorporated into any proposals I will put forward in the review of the gas sector's regulation that I will be undertaking following the enactment of this Bill. It is probably more correct to say that someone else will be introducing proposals - maybe it will be Deputy Stagg.

Deputy Higgins referred to the fact that there is only one member of the commission for electricity regulation. The Deputy was deeply involved in this area, as was Deputy Stagg, in putting together the 1999 Act, so he will know about it. That Act specifically allows for up to three members of the commission at any one time. This issue is being examined in the Department in light of the extension of the commission's remit under this Bill. I do not wish to pre-empt the outcome of this examination but it would seem sensible at this stage that an expansion of the number of commission members should take place to cater for the additional transfer of functions.

The review of regulation as announced by the Taoiseach amazed me because the reviewers are mainly the regulators. I thought they would be banned from being involved in the review and it was quite staggering that they are the main players in the review.

Amendment put and declared lost.

I oppose this section.

Question "That section 3 stand part of the Bill" put and declared carried.
Sections 4 and 5 agreed to.
NEW SECTION.

Amendments Nos. 13, 14 and 15 are alternatives to Amendment No. 3. Amendments Nos. 3, 13, 14 and 15 will be taken together by agreement.

I move amendment No. 3:

In page 5, before section 6, to insert the following new section:

6. The Act of 1999 is amended, on the appointed day, in the Schedule thereto (a) by the insertion of the following paragraph after paragraph 14-

14A. The Commission shall, following consultations with the Minister, draw up a code of conduct in respect of controls on staff interests and ethical behaviour to apply to each member of its staff and shall publish any such code of conduct.',

(b) by the insertion of the following paragraphs after paragraph 42-

42A. (1) On his or her offer of appointment, each member of the Commission and each consultant and adviser shall make a declaration in writing of his or her interests to the Minister in such form as the Minister, following consultation with the Minister for Finance, may specify.

(2) A person to whom subparagraph (1) applies shall, throughout the tenure of his or her appointment, amend and update his or her declarations of interests as required by the Minister or the Commission, as the case may be, in respect of any changes in the interests held by the person.

(3) (a) A statement of the interests declared under subparagraph (1) shall be made public following the making of the declaration and any subsequent change in a declaration shall also be made public.

(b) The form and content of the statement to be publicised shall be agreed between the Commission, the Minister and the Minister for Finance.

(c) Notwithstanding subparagraph (3)(b), it shall not be necessary to specify in a statement in such report the amount or monetary value of any interest.

(4) Where a person to whom subparagraph (1) applies, fails to make a declaration in accordance with that subparagraph, the Minister shall decide the appropriate action (including removal from office or termination of contract) to be taken.

(5) In this paragraph "interests" includes-

(a) shares in, bonds or debentures of, or other like investments in any undertaking related to the gas or electricity industries where the aggregate of such holdings exceeds €10,000,

(b) a directorship or shadow directorship (within the meaning of the Companies Acts, 1963 to 1999) in such an undertaking held currently or during the previous two years, or

(c) gifts of travel, holidays, transport, money (in excess of €500) or other benefits, including benefits from any beneficial interest in or connected with such an undertaking, during the previous two years which were received by the person being appointed or by his or her spouse.

42B. (1) Where a member of the staff of the Commission or a consultant, adviser or other person engaged by the Commission, has a pecuniary interest or other beneficial interest in, or material to, any matter which falls to be considered by the Commission he or she shall-

(a) disclose to the Commission, or where there is only one member of the Commission, that member shall disclose to the Minister, the nature of his or her interest in advance of any consideration of the matter,

(b) neither influence nor seek to influence a decision in relation to the matter,

(c) take no part in any consideration of the matter,

(d) if he or she is a member of the staff of the Commission, withdraw from the meeting for so long as the matter is being discussed or considered by the Commission and shall not vote or otherwise act as such member in relation to the matter.

(2) For the purposes of this section, but without prejudice to the generality of subparagraph (1), a person shall be regarded as having a beneficial interest if-

(a) he or she or any member of his or her household, or any nominee of his or her or any member of his or her household, is a member of a company or any other body which has a beneficial interest in, or material to, a matter referred to in that subsection, or

(b) he or she or any member of his or her household is in partnership with or is in the employment of a person who has a beneficial interest in, or material to, such a matter, or

(c) he or she or any member of his or her household is in the process of acquiring land or property to which such a matter relates.

(3) For the purposes of this section, a person shall not be regarded as having a beneficial interest in, or material to, any matter by reason only of an interest of his or hers or of any company or of any other body or person mentioned in subparagraph (2) which is so remote or insignificant that it cannot reasonably be regarded as likely to influence a person in considering, discussing or voting on any question with respect to the matter or in performing any function in relation to that matter.

(4) Where a question arises as to whether or not a course of conduct, if pursued by a person, would be a failure by him or her to comply with the requirements of subparagraph (1) the question shall be determined by the Commission or, where there is only one member of the Commission, in the case of that member, by the Minister.

(5) Where a disclosure is made to the Commission particulars of the disclosure shall be recorded in the minutes of any meeting concerned.

(6) Where a person, other than a member of the Commission, referred to in this section fails to make a disclosure in accordance with this section the Commission shall decide the appropriate action (including removal from office or termination of contract) to be taken.

(7) Where a member of the Commission fails to make a disclosure in accordance with this section the Minister shall decide the appropriate action (including removal from office) to be taken.'.".

One of the glaring omissions in this Bill relates to the fact that we are divesting powers through a new independent authority yet we are not drawing up a code of conduct for it. We propose to amend the Schedule to the 1999 Act obliging the commission to draw up a code of conduct that would require commission members and their advisers and consultants to disclose their interests in the gas and electricity industries.

On his or her appointment each commission member should make a declaration of interests. They should amend and update this on a regular basis if there is a change in circumstances. The statement of interests should be made public and the form and content of the statement to be publicised should be agreed between the commission, the Minister and the Minister for Finance. It would not be necessary to specify the amount of money involved but there would be a general declaration of a monetary interest. The Minister has the power to decide on the sanctions to be imposed in the event of non-compliance.

Subsection 5(a) of the amendment sets the threshold for such declarations as being in excess of €10,000. Subsection 5(c) deals with gifts or benefits in kind and sets the threshold for declaration of gifts and other such benefits at above €500.

Paragraph 42B. (1) of the amendment states that where a member of the staff of the commission has a pecuniary interest or other beneficial interest in a related area he or she must disclose to the commission the nature of that interest. We are seeking here to ensure that there would not be any attempt by a member, or a consultant or adviser, to influence a decision in regard to any matter. If an item came up for discussion where an interest was held the member concerned would absent himself or herself from the meeting. This would not be confined to the member alone - as we have argued on a previous occasion - but also covers a member of his or her household or any nominee of his or her, or any member of his or her household who is a member of a company which has a beneficial interest.

In subsection (3) there is an exemption stating that for the purposes of this section a person shall not be regarded as having a beneficial interest in, or material to, any matter by reason only of an interest of his or hers or any company or any other body or person mentioned in subparagraph (2) which is so remote or so insignificant that it cannot be reasonably regarded as likely to influence a person in considering, discussing or voting on any question with respect to the matter or in performing any function in relation to that matter.

We are trying to produce a set of guidelines which would apply in regard to anybody who is a member of the commission or who is an adjunct to the commission in any way. This was a glaring omission when the Bill was originally published.

I thank Deputy Higgins and his colleagues, Deputies Stanton and Naughten, for bringing forward the proposals contained in the amendment which would provide for an obligation on the commission to publish a code of conduct for its members and staff and ensure it was covered by specific obligations in relation to declarations and disclosures of interests. I fully agree with the Deputies that these important issues should be addressed in the text of the Bill, but having examined the proposed amendment I have decided to bring forward my own proposal which will largely mirror amendment No. 3 with a number of changes to improve the text. The changes relate to the reporting relationship between members of the commission and the Minister, on the one hand, and between members of the commission and the staff of the commission on the other. They also relate to the publication of declarations of interest.

Amendments Nos. 13 to 15, inclusive, have been written to be in line with certain existing legislative provisions, particularly sections 15, 17 and 18 of the Aviation Regulation Act, 2001. The text of amendments Nos. 14 and 15 makes clear that it is the duty of the commission, not the Minister, to take appropriate action if there is a breach of the rules regarding the declaration or disclosure of interests by a member of the commission's staff or a consultant or adviser employed by the commission. In the case of a breach of the rules by a member of the commission, the Minister will decide what action is to be taken. Amendment No. 14 will ensure declarations of interest by members of the commission are published in the proper forum, in the annual report submitted by the commission to the Minister and laid before the Houses of the Oireachtas.

I thank Deputy Higgins and his colleagues for bringing forward this useful proposal. While I cannot accept the text of amendment No. 3, I am sure they will appreciate that the issues they have sought to be addressed are dealt with in my amendments Nos. 13, 14 and 15.

I do not have a problem with withdrawing my amendment as the Minister of State has largely embraced its content and spirit. I have no problem with the fact that he has increased the declaration thresholds from €10,000 to €12,500 for shares, bonds or debentures and from €500 to €650 for gifts. As mentioned, there will not be an exclusion from an obligation to declare if the amount is deemed to be insignificant. Perhaps the Minister of State is correct in this regard as it is difficult to define what is and is not significant when talking about a pecuniary or vested interest.

The Deputy should know the difference at this stage.

As it is something which could be exploited, I do not have a problem with its omission from the Government amendment. I withdraw my amendment in the context of the Minister of State's proposals in amendments Nos. 13, 14 and 15. I thank him for importing into the Bill what Fine Gael sought in amendment No 3.

Amendment, by leave, withdrawn.
SECTION 6.

I move amendment No. 4:

In page 6, between lines 39 and 40, to insert the following:

"(d) by the substitution for subsection (5) of the following subsections:

'(5) In the exercise of its functions under this Act and without prejudice to subsections (3) and (4), the Commission shall encourage and secure adequate energy supply in the interests of all users in a manner that promotes economic efficiency and gives the maximum benefit to users and in doing so shall have regard to-

(a) the need to ensure a satisfactory supply of gas and electricity for users and in particular the need to take account of the needs of rural customers, the disadvantaged and the elderly,

(b) the need to stimulate a competitive market in the provision of gas and electricity,

(c) the need to take account of the protection of the environment,

(d) the need to encourage the efficient use and production of energy,

(e) the need to encourage research and development into-

(i) methods of generating electricity energy using renewable, sustainable and alternative forms of energy and combined heat and power; and

(ii) methods of increasing efficiency in the use and production of energy;

(f) the need to require that the system operator gives priority to generating stations using renewable, sustainable or alternative energy sources when selecting generating stations,

(g) the need to co-operate with regulatory authorities in other Member States,

(h) the principles of non-discrimination (including equal access) and proportionality, and

(i) the need to impose, maintain and develop public service obligations in accordance with section 17.’.”.

The reference in the amendment to "the need to ensure a satisfactory supply of gas and electricity for users and in particular the need to take account of the needs of rural customers, the disadvantaged and the elderly" would be an addition to existing legislative provisions. Although the 1999 Act mentions rural customers, I propose to specifically mention the disadvantaged and the elderly who may not live in rural areas. It is important that we specifically refer to giving priority to "generating stations using renewable, sustainable or alternative energy sources" when selecting generating stations. While taking on board some of the provisions of the 1999 Act, we wish to add additional important elements, even though the Bill is an interim measure.

Section 9, subsections (1) and (2), of the Electricity Regulation Act, 1999, describes some of the functions of the commission. More relevantly, subsections (3), (4) and (5) describe the duties of the Minister and the commission. Subsection (3) describes the primary duties while subsection (4) sets out a range of issues which must be taken into account in discharging them. Subsection (5) places additional duties on the commission in discharging its functions. While I appreciate that Deputy Higgins's proposal has been made in good faith, his amendment would change fundamentally the manner in which the duties are set out in the Act and replace the duties described in subsection (5).

I do not propose to accept the amendment as such acceptance would not be a good development. The essence of the first paragraph of the amendment, the protection of the interests of final customers of both gas and electricity, is encapsulated in section 6, subsections (3) and (4). The Act would be amended by paragraphs (b) and 6c)(i) of section 6. The amendment describes matters to which the commission should have regard, thereby eliminating, in effect, the duties described in section 9(5) of the Act. The duties should not be altered in this way. The list of matters to which the commission should have regard, as set out in the amendment, is already encapsulated in subsection (4) or set out as duties in subsection (5), with some minor differences.

Section 9(5) of the Electricity Regulation Act, 1999, states:

"without prejudice to subsections (3) and (4), it shall be the duty of the commissioner:

(a) to take account of the protection of the environment;

(b) to encourage the efficient use and production of electricity;

(c) to take account of the needs of rural customers, the disadvantaged and the elderly;

(d) to encourage research and development into-

(i) methods of generating electricity using renewable, sustainable and alternative forms of energy and combined heat and power;

(ii) methods of increasing efficiency in the use and production of energy."

I cannot see the reason we cannot include in the Bill "the need to encourage research and development," "the need to require that the system operator gives priority to generating stations using renewable, sustainable or alternative energy sources when selecting generating stations," "the need to co-operate with regulatory authorities in other Member States" or "the principles of non-discrimination (including equal access) and proportionality". Inserting this into the Act would oblige the commission to have regard to competition in the market. Competition is one of the provisos, though there are others. The reason I propose this is that there is a need to stimulate a competitive market in the provision of gas and electricity. Surely, the whole purpose of regulation is to ensure competition. The regulator is there to liberalise and open up the market and to ensure there is an level playing field so I cannot see what the problem is. I cannot see how this amendment would fundamentally change the thrust of the Bill. Perhaps the Minister of State will elaborate.

We have examined this very carefully since Deputy Jim Higgins and his colleagues put down their detailed and substantial amendment. After that careful examination, the feeling is that the amendment would fundamentally change the manner in which the duties are set out in the Act and would replace duties already described. As a result, we do not deign to accept this change.

I have made a case for the amendment and I am pressing it. I will return to it on Report Stage.

Amendment put and declared lost.

I move amendment No. 5:

In page 6, between lines 39 and 40, to insert the following:

"(d) by the insertion of subsection (6) after subsection (5):

'(6) In carrying out its functions the Commission shall ensure that all determinations, regulations and conditions attaching thereto, amendments thereof and requests shall be objectively justified and shall be non-discriminatory, proportionate and transparent.'.".

The amendment is self explanatory. Will the Minister of State respond to it?

I agree with what this seeks to enshrine in the Bill as part of the explicit duties of the regulator. I commend Deputy Jim Higgins and his colleagues for putting it forward. These are concepts we all share. I was very keen to accommodate the proposals within the Bill, however, having carefully considered the amendment following discussions with my officials and legal advisers, I regret I am unable to accept the proposal.

The clear legal advice resulting from this process is that this text, which is very attractive at first glance, is too open to subjective interpretation to be acceptable in this Bill. The clear advice I have is that this text could hamper the regulator in carrying out his duties because it is wide open to being abused by anybody seeking to disrupt the work of the regulator in ensuring that the rules governing the market are being enforced. I regret that I cannot accept this amendment, which at face value appears to be utterly commendable. In this instance, I will not go against the decision taken by my legal advisers.

I am at a loss to know how the Minister of State can say this amendment completely opens the commission to being challenged. We are saying that if the commission is making determinations, setting down regulations and imposing conditions, these should be objectively justified. If those decisions can be stood over, what is the problem with justifying them? They should be justified on the basis of the regulator being able to guarantee, show and prove that the regulations, the conditions and his determinations comply with the fundamental principles of opening up the marketplace, whereby they should be non-discriminatory, proportionate and transparent. I cannot possibly see how the Minister of State and those advising him can arrive at the conclusion that this undermines the regulator. It would not, rather it would comply entirely with the spirit in which the regulator is supposed to operate and it would import and inject much confidence into the regulatory system.

One of the points Deputy Stagg has been making relates to the fact that decisions do not have to be justified. People make decisions in ivory towers and are answerable to nobody. Where is the problem? Surely, now is the time to ensure that we include in the Bill something akin to what Deputy Stagg seeks, while not eroding the powers of the regulator or undermining him in any way.

The legal advice is very clear. This text is not suitable for insertion into the Bill. Much as I found it to be meritorious at first glance, having examined it and taken legal advice I am not in a position to accept it. Much, if not all, of that which the Deputies seek by this amendment is already covered, either explicitly or implicitly in the existing electricity regulatory framework and in the framework being supplied by the Bill.

The matter of non-discrimination is already covered in the 1999 Act, as well as in the Bill. It is a primary duty of the regulator not to discriminate unfairly among the various undertakings operating in the market and that is clearly stated in section 6 paragraph (b). The objectivity and transparency being sought here is already ensured through section 9 of the Electricity Regulation Act, 1999, and through section 6 of this Bill, amending the 1999 Act. These sections set out the duties of the regulator and specify precisely the things the regulator must take into account when taking any action or making any decision. I am sure Deputy Jim Higgins is also aware of good practice in terms of the consultation procedures which the regulator follows as a matter of course.

All public bodies have an implicit duty to act in a proportionate manner and this is a fundamental principle of administrative law which requires that there be a balance between an injury to an individual's interest by an administrative measure and the consequential gain to society. Notwithstanding the way in which this amendment is unsuited to the Bill, the inclusion of any regulations made by the commission in this sort of provision would not be possible. As all regulations made by the commission must be laid before the Oireachtas, the effect would be to extend the requirements of the provision to actions taken by the Oireachtas in regard to these regulations. It is not possible to fetter the actions of the Oireachtas in this way. I understand the good intentions of the Deputies with regard to this proposal, but the advice to me is quite clear and I am not able to accept the amendment.

Before I decide whether to press the amendment, I recall that the Minister of State prefaced his comments with very complimentary remarks. He said that when he looked at the amendment, prima facie, there was something that attracted him. What merit did he see in it before he was subjected to legal counsel as to the wisdom, or otherwise, of the proposal?

I had to honestly state that, on first reading, the amendment seemed to be quite meritorious. The text used is in the Aviation Regulation Act, 2001, but what is appropriate to one Act is not necessarily appropriate to another. My understanding is that in the case of the Aviation Regulation Act, from which this amendment and all it entails was born, the Aviation Commission which it established has the power to make only two types of specific determination, one on airport charges and the other on aviation terminal service charges. The nature and scope of each of these determinations is set out very clearly and precisely in the text of that Act and each is accompanied by clear sets of regulatory objectives which the commission is required to take into account when making a particular type of determination. This puts the issue in a totally separate context from that which applies to this legislation.

The amendment seeks to address not only determinations by the commission, but also any regulations that are made, together with their conditions and amendments, and any requests made by the commission. This is a very extensive list of matters to be covered by such a provision and cannot be compared to the very circumscribed situation pertaining in the Aviation Regulation Act. What is appropriate in one instance is not necessarily acceptable in another. I hope I am answering Deputy Jim Higgins's question when I state that all this was made apparent to me after my first reaction and the clear advice in this case is that the proposed amendment is not appropriate to this Bill.

Amendment put and declared lost.
Section 6 agreed to.
NEW SECTIONS.

Amendment No. 6 is in the name of Deputies Jim Higgins, Stanton and Naughten. Amendment No. 19 is consequential and both amendments may be discussed together by agreement.

I move amendment No. 6:

In page 6, before section 7, to insert the following new section:

"7.-The Act of 1999 is amended, on the appointed day, by the insertion of the following section after section 9:

'9A.-(1) The Commission may in relation to gas distribution agreements-

(a) set conditions which the Commission may specify as a condition precedent to the conclusion of a gas distribution agreement in the areas listed in Part I of Schedule 2 which said conditions shall be published by the Commission in accordance with section 9B, and

(b) encourage coverage of the issues listed in Part II of Schedule 2.

(2) The Commission may, from time to time, intervene on its own accord and shall intervene if requested by any party concerned in order to specify issues which shall be included in a gas distribution agreement or to lay down specific conditions to be observed by one or more parties to such an agreement and the Commission may direct that those issues or conditions be included in the gas distribution agreement and it shall be an offence to fail to comply with a direction of the Commission under this subsection.

(3) In exceptional cases the Commission may direct that changes be made to a gas distribution agreement in order to ensure effective competition of services for users and it shall be an offence to fail to comply with a direction of the Commission under this subsection.

(4) The conditions set or changes directed by the Commission pursuant to subsections (2) and (3) may include, inter alia, conditions designed to ensure effective competition, technical conditions, tariffs, supply and usage conditions, conditions as to compliance with relevant standards, compliance with essential requirements, protection of the environment or maintenance of end-to-end quality of service.

(5) The Commission may, at any time on his or her own initiative or if requested by either party, set the period within which negotiations on gas distribution shall be completed and if agreement is not reached within that period the Commission shall take steps to conclude an agreement under procedures to be laid down by the Commission.

(6) The Commission shall establish and maintain procedures in order to procure the agreement referred to in subsection (5) and the procedures shall be made available to the public in accordance with section 9B.

(7) In the event of a dispute between organisations in relation to gas distribution the Commission shall, at the request of either party, take steps to resolve the dispute within six months of that request being made and the resolution of the dispute (in these Regulations referred to as a "finding" of the Commission) shall represent a fair balance between the legitimate interests of both parties.

(8) In seeking to resolve a dispute under this Act the Commission shall take into account, inter alia-

(a) the user interest,

(b) regulatory obligations or constraints imposed on any of the parties,

(c) the availability of technically and commercially viable alternatives to the gas distribution requested,

(d) the desirability of ensuring equal access arrangements,

(e) the need to maintain the integrity of the gas distribution network,

(f) the nature of the request in relation to the resources available to meet the request,

(g) the relative market positions of the parties,

(h) the public interest (including but not restricted to the protection of the environment),

(i) the promotion of competition, and

(j) the need to maintain a public service obligation.

(9) The Commission shall make any finding under subsection (7) available to interested parties on a request being made to the Commission and the parties to the dispute shall be given a full statement of the reasons on which the decision is based.

(10) An organisation which fails to comply with a finding of the Commission under subsection (7) shall be guilty of an offence.'.".

The purpose of the amendment is to define the role of the commission in relation to regulating and overseeing gas distribution agreements. I am trying to set out clearly and in sequence what the role of the commission should be with regard to overseeing agreements and arbitrating where there are difficulties.

Section 9A states:

(1) The Commission may in relation to gas distribution agreements-

(a) set conditions which the Commission may specify as a condition precedent to the conclusion of a gas distribution agreement in the areas listed in Part I of Schedule 2 which said conditions shall be published by the Commission in accordance with section 9B, and

(b) encourage coverage of the issues listed in Part II of Schedule 2.

Part II of Schedule 2 is an associated amendment which will be made available today. The section continues:

(2) The Commission may, from time to time, intervene on its own accord and shall intervene if requested by any party concerned in order to specify issues which shall be included in a gas distribution agreement or to lay down specific conditions to be observed by one or more parties to such an agreement and the Commission may direct that those issues or conditions be included in the gas distribution agreement and it shall be an offence to fail to comply with a direction of the Commission under this subsection.

(3) In exceptional cases the Commission may direct that changes be made to a gas distribution agreement in order to ensure effective competition of services for users and it shall be an offence to fail to comply with a direction of the Commission under this subsection.

(4) The conditions set or changes directed by the Commission pursuant to subsections (2) and (3) may include, inter alia, conditions designed to ensure effective competition, technical conditions, tariffs, supply and usage conditions, conditions as to compliance with relevant standards, compliance with essential requirements, protection of the environment or maintenance of end-to-end quality of service.

In other words, if there is an undue delay, the commission may intervene and set down a period within which the negotiations will be finished to ensure they do not drag on interminably.

Subsection (6) effectively sets a time limit on such negotiations. It states:

The Commission shall establish and maintain procedures in order to procure the agreement referred to in subsection (5) and the procedures shall be made available to the public in accordance with section 9B.

Subsection (7) covers the role of the commission as an arbitrator and states:

In the event of a dispute between organisations in relation to gas distribution the Commission shall, at the request of either party, take steps to resolve the dispute within six months of that request being made and the resolution of the dispute (in these Regulations referred to as a "finding" of the Commission) shall represent a fair balance between the legitimate interests of both parties.

The amendment then lists a number of issues which the regulator would take into consideration when trying to resolve a dispute and stipulates that the dispute must be resolved within six months. The aim of this section is to define the arbitration role of the commission.

I again commend Deputy Higgins and his colleagues on the amount of research they have invested in the very extensive proposals contained in the two amendments. They contain a large number of provisions and it would be inappropriate to try to incorporate them in the Bill. As I mentioned, this Bill is an interim measure designed to provide the basic set of powers and functions of the regulator in order that he can carry out his duties in regard to the gas sector in an effective manner. The approach being taken is to tie together the existing regulatory frameworks contained in the Gas Act, 1976, the Gas (Amendment) Act, 1987, and the Electricity Regulation Act, 1999, into one cohesive framework. The Bill, as passed by the Seanad, taken with the amendments I have proposed today, achieves this objective.

The proposals in the two amendments appear to rely heavily on legislation developed for the telecommunications sector, in particular, SI 15 of 1998, which transposed the interconnection directive into Irish law. While the text has been amended to ensure that it contains references appropriate to the regulation of the gas sector, it retains a number of concepts which relate to the telecommunications sector. Concepts such as "essential requirements" have a very specific meaning particular to the European Union regulatory framework governing the telecommunication sector and are not used in EU legislation governing the energy sector, in particular, the gas sector. Therefore, I consider it extremely inadvisable to try to import these concepts into primary legislation dealing with the Irish energy sector. In any case, as I have mentioned, the proposed provisions are based on provisions dealing with interconnection in telecommunications which is comparable to the issue of third party access in energy.

Section 11 of the Bill deals with this issue from the point of view of the obligations imposed on Ireland under the European gas directive 98/30/EC. When taken with my amendments, in particular, amendment No. 28 dealing with access to upstream pipelines tabled on behalf of my colleague, the Minister for the Marine and Natural Resources, Deputy Fahey, I believe the issue has been comprehensively dealt with in the Bill and, therefore, I will not accept the amendments.

Does the Minister of State accept that one will have disputes if one opens up the market and that this will frequently require the regulator to make a determination on gas distribution agreements? I cannot see the logic of the Minister of State's argument that he cannot accept the amendment because it is being imported from telecommunications regulation legislation. What is so objectionable in setting down in detail what should be the procedures, the role and function and setting clear guidelines in regard to a timeframe for the resolution of disputes? How can this be in conflict with the Bill, or with the spirit of the regulator or the manner in which the regulator should function? We are setting down in clear detail how the procedures should operate, a time definition in regard to the resolution of disputes and what the regulator should take into consideration in his role as arbitrator in deciding who gets what, or how the eventual agreement should be formulated and determined by him.

Disputes will arise but the commission already has the power to intervene in disputes in regard to connections or access agreements. It also has the power to specify in regulations the types of terms and conditions including those related to price in those agreements. This covers agreements in regard to connections to and access to transmission and distribution networks. These provisions are clearly set out in section 10 (a) of the 1976 Act as amended in section 11 of the Bill. The issues that the Deputy is seeking to be covered by this amendment are already addressed.

Amendment put and declared lost.

I move amendment No. 7:

In page 6, before section 7, to insert the following new section:

"7.-The Act of 1999 is amended, on the appointed day, by the insertion of the following section after section 9:

'9B.-(1) With regard to the information referred to in section 9A, the Commission shall ensure that up to date information is published in an appropriate manner in order to provide easy access to that information for interested parties.

(2) The Commission shall publish a notice in Iris Oifigiúil as to the manner in which the information referred to in subsection (1) is published.

(3) The Commission shall ensure that the information referred to in sections 9, 20 and 22 is made available from its office on request to interested parties free of charge, during normal working hours.

(4) The Commission shall publish a notice in Iris Oifigiúil as to the times and locations at which the information referred to in subsection (3) shall be available.’.”.

The amendment is self-explanatory.

While I am not inclined to accept the amendment, I see merit in having a general provision in the Bill dealing with the publication of information by the commission. In particular, I have in mind, the publication of information aimed at ordinary electricity and gas customers telling them what they are entitled to under the legislation. It is a complex area even for the experts and some method of ensuring consumers are aware of their rights would assist in demystifying the liberalisation process and help people to benefit from it. I intend considering this matter further and thank Deputy Higgins for raising it. I will earnestly consider it between now and Report Stage.

I thank the Minister of State and look forward to a Report Stage amendment. The Minister of State evidently sees considerable merit in this but I will reintroduce it on Report Stage as a safeguard to ensure that the Minister of State brings forward an amendment of his own.

Amendment, by leave, withdrawn.
SECTION 7.

Amendment No. 8 is a drafting amendment. Amendments Nos. 8 to 12, inclusive, are cognate and will be taken together by agreement.

Do we have any arrangements for having a break.

A proposal from Deputy Stagg was agreed to at the outset of the meeting, which suggested that we would conclude by lunch time.

And Deputy Stagg walks out.

Deputy Stagg said he is available.

Have we decided on what is lunch time?

Deputy Gildea described lunch time in Dáil Éireann in the past and I think it still applies.

We have been only a little over an hour in session and we have made great progress. Perhaps the amendments to come may not generate as much discussion as the others.

I do not have any problem with that. On Second Stage I supported the broad thrust of the Bill and I am seeking to bring in amendments that will improve the Bill. I am anxious to co-operate with getting the Bill passed, and will move those amendments again on Report Stage. I suggest we aim for a 1.15 p.m. lunch time.

Is that agreed? Agreed.

I move amendment No. 8:

In page 7, subsection (3), line 6, to delete "section" and substitute "Act".

Amendment agreed to.

I move amendment No. 9:

In page 7, subsection (4), line 11, to delete "section" and substitute "Act".

Amendment agreed to.

I move amendment No. 10:

In page 7, subsection (5), line 20, to delete "section" and substitute "Act".

Amendment agreed to.

I move amendment No. 11:

In page 7, subsection (6), line 25, to delete "section" and substitute "Act".

Amendment agreed to.

I move amendment No. 12:

In page 7, subsection (7), line 30, to delete "section" and substitute "Act".

Amendment agreed to.
Section 7, as amended, agreed to.
NEW SECTIONS.

I move amendment No. 13:

In page 7, before section 8, to insert the following new section:

8.-(1) The Commission shall, following consultation with the Minister, draw up a code of conduct in respect of controls on the interests and ethical behaviour to apply to each member of the Commission and member of the staff of the Commission.

(2) The Commission shall publish any code of conduct drawn up under subsection (1).

Amendment agreed to.

I move amendment No. 14:

In page 7, before section 8, to insert the following new section:

9.-(1) On his or her offer of appointment, each member of the Commission shall make a declaration in writing of his or her interests to the Minister, in such form as the Minister, following consultation with the Minister for Finance, may specify.

(2) On his or her offer of appointment, each consultant and adviser and each member of the staff of the Commission at a grade or level specified before the appointment by the Commission, following consultation with the Minister, shall declare his or her interests in writing to the Commission and, within one month of such declaration, the Commission shall, on request, provide the details of all such declarations to the Minister.

(3) A person to whom subsection (1) or (2) applies shall, throughout the tenure of his or her appointment, amend and update his or her declarations of interests in respect of any changes in the interests held by the person.

(4) (a) A statement of the interests declared under subsection (l) shall be included in the next report prepared in accordance with paragraph 25(c) of the Schedule to the Act of 1999 following the making of the declaration and any subsequent change in a declaration shall also be included in a statement in the next available report.

(b) The form and content of the statement to be included in such report shall be agreed between the Commission, the Minister and the Minister for Finance.

(c) Notwithstanding paragraph (b), it shall not be necessary to specify in a statement in such report the amount of monetary value of any interest, or the remuneration of any trade, profession or employment included in the statement.

(5) Where a person to whom subsection (l) applies, fails to make a declaration in accordance with that subsection, the Minister shall decide the appropriate action (including removal from office) to be taken.

(6) Where a person to whom subsection (2) applies, fails to make a declaration in accordance with that subsection, the Commission shall decide the appropriate action (including removal from office or termination of contract) to be taken.

(7) In this section-

'employment' includes-

(a) full-time employment,

(b) part-time paid employment, where such employment is ongoing in the year of appointment or which arises in subsequent years,

(c) temporary paid employment, being for a period of 16 weeks or more in the year of appointment or in subsequent years, or

(d) being retained under contract, directly or indirectly, in any capacity as an adviser, consultant or lobbyist, or for the provision of services;

'interests' includes-

(a) shares in, bonds or debentures of, or other like investments in any undertaking related to the gas or electricity industries, where the aggregate of such holdings exceeds €12,500,

(b) a directorship or shadow directorship (within the meaning of the Companies Acts, 1963 to 2001), in such an undertaking, held currently or during the previous two years, or

(c) gifts of travel, holidays, transport, money (in excess of €650) or other benefits, including benefits from any beneficial interest in or connected with such an undertaking, during the previous two years which were received by the person being appointed or by his or her spouse.

Amendment agreed to.

I move amendment No. 15:

In page 7, before section 8, to insert the following new section:

'10.-(1) Where a member of the Commission, a member of the staff of the Commission, or a consultant, adviser or other person engaged by the Commission, has a pecuniary interest or other beneficial interest in, or material to, any matter which falls to be considered by the Commission, he or she shall-

(a) disclose to the Commission, or where there is only one member of the Commission, that member shall disclose to the Minister, the nature of his or her interest in advance of any considerations of the matter,

(b) neither influence nor seek to influence a decision in relation to the matter,

(c) take no part in any consideration of the matter,

(d) if he or she is a member of the Commission or a member of the staff of the Commission, withdraw from the meeting for so long as the matter is being discussed or considered by the Commission, and shall not vote or otherwise act as such member in relation to the matter.

(2) For the purposes of this section, but without prejudice to the generality of subsection (1), a person shall be regarded as having a beneficial interest if-

(a) he or she or any member of his or her household, or any nominee of his or hers or any member of his or her household, is a member of a company or any other body which has a beneficial interest in, or material to, a matter referred to in that subsection, or

(b) he or she or any member of his or her household is in partnership with or is in the employment of a person who has a beneficial interest in, or material to, such a matter, or

(c) he or she or any member of his or her household is in the process of acquiring land or property to which such a matter relates.

(3) For the purposes of this section, a person shall not be regarded as having a beneficial interest in, or material to, any matter, by reason only of an interest of his or hers or of any company or of any other body or person mentioned in subsection (2) which is so remote or insignificant that it cannot reasonably be regarded as likely to influence a person in considering, discussing or in voting on, any question with respect to the matter, or in performing any function in relation to that matter.

(4) Where a question arises as to whether or not a course of conduct, if pursued by a person, would be a failure by him or her to comply with the requirements of subsection (1), the question shall be determined by the Commission, or, where there is only one member of the Commission, in the case of that member, by the Minister.

(5) Where a disclosure is made to the Commission, particulars of the disclosure shall be recorded in the minutes of any meeting concerned.

(6) Where a person, other than a member of the Commission, referred to in this section fails to make a disclosure in accordance with this section, the Commission shall decide the appropriate action (including removal from office or termination of contract) to be taken.

(7) Where a member of the Commission fails to make a disclosure in accordance with this section, the Minister shall decide the appropriate action (including removal from office) to be taken.".

Amendment agreed to.
SECTION 8.

I move amendment No. 16:

In page 7, subsection (1), line 43, to delete "company" and substitute "Board".

Amendment agreed to.

Amendments Nos. 17, 18, 32, 41, 44, 46, 47 and 48 are related and will be taken together by agreement.

I move amendment No. 17:

In page 9, subsection (4)(a), line 3, to delete “(£1,575.13)”.

Amendment agreed to.

I move amendment No. 18:

In page 9, subsection (4)(b), line 6, to delete “(£1,575.13)”.

Amendment agreed to.
Section 8, as amended, agreed to.
SECTION 9.
Amendment No. 19 not moved.

I move amendment No. 20:

In page 14, subsection (5)(b), between lines 37 and 38, to insert the following:

"(v) the terms and conditions that may be applied in relation to the successful applicant,”.

Amendment agreed to.
Section 9, as amended, agreed to.
Section 10 agreed to.
SECTION 11.

Amendment No. 21 is consequential on amendment No. 28 and they will be taken together by agreement.

I move amendment No. 21:

In page 15, subsection (1), line 30, to delete "section is" and substitute "sections are".

Amendment agreed to.

Amendment Nos. 23 and 24 are consequential on amendment No. 22 and will be taken together by agreement.

I move amendment No. 22:

In page 15, subsection (1), to delete lines 33 to 37 and substitute the following:

"10A.-(1) Subject to subsection (6) of this section, where an application is made to a pipeline operator by-

(a) the holder of a natural gas licence under section 13 of the Gas (Interim) (Regulation) Act, 2002, for the purpose of carrying out any activity for which the holder is licensed,

(b) the holder of a petroleum lease under section 13 of the Petroleum and Other Minerals Development Act, 1960, for the purpose of carrying out any activity connected with the lease,”.

Amendment agreed to.

I move amendment No. 23:

In page 16, to delete lines 18 and 19 and substitute "(1)(c) or (d), not less than the annual rate mentioned in subsection (1)(e) of this section), and”.

Amendment agreed to.

I move amendment No. 24:

In page 17, line 15, to delete "(c) or (d)” and substitute “(c), (d) or (e)”.

Amendment agreed to.

Amendments Nos. 25 and 27 are related and may be discussed together.

I move amendment No. 25:

In page 18, lines 11 to 13, to delete all words from and including "otherwise)-" on line 11, down to and including "operator," on line 13 and substitute "otherwise) where an offer is made or refused by the operator,".

Amendment agreed to.

I move amendment No. 26:

In page 18, between lines 16 and 17, to insert the following:

"(9) Where an application is made under subsection (8) of this section to the Commission in relation to a dispute concerning a distribution or transmission pipeline, part of which is situated in the territory of another state, on the seabed under the territorial seas of another state or on the continental shelf belonging to another state, the Commission shall consult the relevant authorities in that other state with respect to the application.".

Amendment agreed to.

I move amendment No. 27:

In page 18, lines 20 and 21, to delete "of the Commission made under this section".

Amendment agreed to.

I move amendment No. 28:

In page 18, line 33, to delete "2001." and substitute the following:

"2002.

10B-(1) Subject to subsection (6) of this section, where an application is made to an upstream pipeline operator by-

(a) the holder of a natural gas licence under section 13 of the Gas (Interim) (Regulation) Act, 2002, for the purpose of carrying out any activity for which the holder is licensed,

(b) the holder of a petroleum lease under section 13 of the Petroleum and Other Minerals Development Act, 1960, for the purpose of carrying out any activity connected with the lease,

(c) a person, including the Board, in respect of whom an order has been made under section 2(1) of the Gas (Amendment) Act, 1987, for the purpose of carrying out the functions conferred on the person by the order,

(d) a person who operates a gas-fired generating station, irrespective of its annual consumption level, for the purpose of providing energy for the generation of electricity at that station, or

(e) a final customer (within the meaning of section 2 of the Gas (Interim) (Regulation) Act, 2002) with an annual rate of consumption of not less than 2,000,000 standard cubic metres per annum (or such other rate as may stand prescribed for the time being) at a single meter installation for the purpose of delivery to that installation,

to transport on his or her behalf through pipelines under the control of the upstream pipeline operator natural gas, the upstream pipeline operator shall offer to enter into an agreement for the transportation of the natural gas on behalf of that person, subject to terms and conditions specified in regulations made by the Minister for the Marine and Natural Resources under subsection (3) of this section.

(2) Notwithstanding the generality of subsection (1) of this section, an offer made under that subsection:

(a) may include an offer to transport natural gas at a rate that is greater or less than the rate to which the request relates (but, except in the case of an application made by a person mentioned in subsection (1)(c) or (d), not less than the annual rate mentioned in subsection (1)(e) of this section), and

(b) where connection is required to the pipeline of the upstream pipeline operator by the applicant-

(i) shall include the terms for such a connection, including any charges for connection, and details of all technical aspects relating to the connection that might be reasonably required by that person, and

(ii) on request of the applicant, may be on the basis that the applicant constructs, or that either or both the applicant and the upstream pipeline operator arranges to have constructed, the connection to the pipeline, and the ownership of any such connection constructed or arranged to be constructed by the applicant shall, subject to subsection (8) of this section, be a matter for agreement between the parties.

(3) The Minister for the Marine and Natural Resources may, following consultation with the Commission, by regulations provide for-

(a) the matters to be specified in an agreement for transportation of the natural gas through the pipeline of the upstream pipeline operator, including terms and conditions relating to price,

(b) the matters to be specified in an agreement for connection to the pipeline of the pipeline operator,

(c) the terms and conditions, including terms and conditions relating to price of the connection, upon which an offer for connection to the pipeline of the pipeline operator is made,

(d) the methods for determining the proportion of the costs to be borne by the person making the application for connection to the pipeline of the pipeline operator and to be borne by the pipeline operator being costs which are directly or indirectly incurred in carrying out works under an agreement or making a connection or modifying an existing connection,

(e) the terms and conditions upon which applications for an agreement are to be made and the period of time within which an offer or refusal pursuant to an application is to be made by the upstream pipeline operator, and

(f) any other matters which the Minister for the Marine and Natural Resources considers necessary or expedient for the purpose of making an offer for the transportation of natural gas through a pipeline or connection to a pipeline.

(4) An upstream pipeline operator shall comply with any regulations made by the Minister for the Marine and Natural Resources under subsection (3) of this section within such time period as may be specified by the Minister for the Marine and Natural Resources in the regulations.

(5) An upstream pipeline operator shall not make an offer under subsection (1) of this section other than to a person of the type mentioned in paragraph (a), (b), (c), (d) or (e) of that subsection.

(6) An upstream pipeline operator may refuse a request made under subsection (1) of this section-

(a) on the basis of a lack of capacity in its pipeline, save where it is economical for the operator to make the necessary enhancements to the capacity of the pipeline,

(b) on the basis of a lack of connection to that pipeline, save where the person making the request is willing to pay for such a connection in accordance with such conditions as may be specified by the Minister for the Marine and Natural Resources in regulations made under subsection (3) of this section,

(c) where, to enter into an agreement under this section would be likely to involve the upstream pipeline operator in a contravention or a breach of-

(i) the Gas Acts, 1976 to 2002, the Electricity Regulation Act, 1999, the Gas (Amendment) Act, 2000, or the Gas (Interim) (Regulation) Act, 2002,

(ii) regulations made under any of the aforesaid Acts,

(iii) the conditions of any licence granted or consent given to the upstream pipeline operator under this Act or under the Gas (Interim) (Regulation) Act, 2002,

(iv) the conditions of any licence, lease or permit granted to the upstream pipeline operator under the Petroleum and Other Minerals Development Act, 1960, or

(v) the upstream pipeline operator's code of operations, being a code, approved by the Minister for the Marine and Natural Resources, in respect of all technical design, operational and other requirements relating to operation of the upstream pipeline in respect of which the holder has been granted a consent by that Minister under section 40(1), or

(d) the person making the application does not undertake to be bound by the terms of the aforesaid code of operations of the upstream pipeline operator in so far as those terms are applicable to that person.

(7) Where an upstream pipeline operator refuses to offer to enter into an agreement under this section, the operator shall serve notice on the applicant of the reasons for such a refusal.

(8) The Minister for the Marine and Natural Resources, or any person nominated in that behalf by the Minister, for the purposes of Article 21 of the Directive, shall be the competent authority (in this section referred to as the "competent authority") in the State to settle expeditiously disputes concerning refusal of access to upstream pipelines within the scope of the Directive.

(9) Any dispute between an upstream pipeline operator and any person who is, or claims to be, a person to whom the operator is obliged to make an offer for the transportation of natural gas through a pipeline under the control of that operator (and whether as to the making of an offer, the terms offered, the proposed charges or otherwise) where an offer is made or is refused by the operator, may, upon the application of that person, be determined by the competent authority and the operator shall comply with and be bound by any such determination.

(10) Where an application is made under subsection (9) of this section to the competent authority in relation to a dispute concerning an upstream pipeline, part of which is situated in the territory of another state, on the seabed under the territorial seas of another state or on the continental shelf belonging to another state the competent authority shall, prior to considering the application, consult the relevant authorities in that other state with respect to the application.

(11) The parties to a dispute referred to in subsection (8) of this section shall provide all documents, records, accounts, estimates and other information, whether oral or written, requested from time to time, by the competent authority in the form and at the times specified by that authority, for the purpose of making a determination under subsection (9) of this section.

(12) (a) In making a determination under subsection (9) of this section, the competent authority shall apply the objectives of-

(i) fair and open access,

(ii) achieving a competitive market in natural gas, and

(iii) avoiding any abuse of a dominant position.

(b) In applying the objectives under paragraph (a) of this subsection, the competent authority shall take account of-

(i) security and regularity of supplies,

(ii) capacity which is or can reasonably be made available,

(iii) environmental protection, and

(iv) the number of parties which may be involved in negotiating access to upstream pipelines.

(13) Without prejudice to the generality of subsection (12) of this section, in making a determination under subsection (9) of this section, the competent authority may take into account the need-

(a) to refuse access where there is an incompatibility which cannot be reasonably overcome between the technical specifications being proposed by the applicant and those applying to the pipeline of the upstream pipeline operator,

(b) to avoid difficulties which cannot be reasonably overcome and could prejudice the efficient, current and planned future production of natural gas or other hydrocarbons, including that from fields of marginal economic value, and

(c) to respect the duly substantiated reasonable needs of the upstream pipeline operator for the transport and processing of gas and the interests of all other users of the relevant upstream pipeline or processing or handling facilities who may be affected.

(14) In order to ensure compliance with a determination made under subsection (9) of this section the competent authority may apply in a summary manner on notice to the High Court for an order requiring an upstream pipeline operator to comply with the determination.

(15) Where providing for the transportation of natural gas or where offering terms for the carrying out of works for the purpose of connection to a pipeline under the control of an upstream pipeline operator, the upstream pipeline operator shall not discriminate unfairly as between any persons or classes of persons.

(16) An upstream pipeline operator shall not, in the context of sales or purchases of natural gas by that operator or related undertakings, abuse commercially sensitive information obtained from third parties in the context of providing or negotiating access to a pipeline under the control of the upstream pipeline operator.

(17) (a) Subject to paragraph (b) of this subsection, an upstream pipeline operator shall, within such time as the Minister for the Marine and Natural Resources may direct, prepare a statement for the approval of the Minister setting out the basis upon which charges are imposed-

(i) for the transportation of natural gas through a pipeline under the control of the upstream pipeline operator, and

(ii) for connection to a pipeline under the control of that upstream pipeline operator.

(b) The Minister for the Marine and Natural Resources may-

(i) give directions to an upstream pipeline operator from time to time in respect of the basis for charges for the transportation of natural gas through, or connection to, a pipeline under the control of the upstream pipeline operator, and

(ii) specify by regulations the classes of upstream pipeline operator to whom paragraph (a) of this subsection does not apply.

(c) Notwithstanding the generality of paragraph (b) of this subsection, directions given by the Minister for the Marine and Natural Resources under this subsection may provide for-

(i) the methods of charging to be included in the statement to be prepared by an upstream pipeline operator,

(ii) the form and the extent of the information to be provided by an upstream pipeline operator to applicants,

(iii) the form of charges and information about those charges to be included in the statement to be prepared by an upstream pipeline operator,

(iv) the procedure to be adopted in the submission by an upstream pipeline operator of a statement of charges and the approval by the Minister for the Marine and Natural Resources of such statement, and

(v) the nature of information to be provided to applicants seeking the transportation of natural gas through, or connection to, a pipeline under the control of the upstream pipeline operator and its presentation and transparency.

(d) An upstream pipeline operator shall comply with directions given to it by the Minister for the Marine and Natural Resources under this subsection.

(e) A charge for the transportation of natural gas through, or connection to, a pipeline under the control of the upstream pipeline operator shall be calculated in accordance with directions given by the Minister for the Marine and Natural Resources under this section so as to enable the upstream pipeline operator to recover-

(i) the appropriate proportion of the costs directly or indirectly incurred in carrying out any necessary works, and

(ii) a reasonable rate of return on the capital represented by such costs.

(f) The Minister for the Marine and Natural Resources, solely, shall determine that which constitutes an “appropriate proportion” referred to in paragraph (e)(i) of this subsection and a “reasonable rate of return” referred to in paragraph (e)(ii) of this subsection.

(18) (a) An upstream pipeline operator shall send each statement prepared in accordance with subsection (17) of this section to the Minister for the Marine and Natural Resources for its approval (in this section referred to as the “statement“) and the statement, and in particular any charges referred to therein, shall not apply until such time as it has been approved of by the Minister for the Marine and Natural Resources, subject to such modifications, if any, as that Minister considers appropriate.

(b) The Minister for the Marine and Natural Resources shall consult with an upstream pipeline operator and have regard to any submission made by the upstream pipeline operator to the Minister for the Marine and Natural Resources prior to making a decision as to whether to approve of or not, as the case may be, a statement submitted by the upstream pipeline operator to the Minister for the Marine and Natural Resources for approval.

(c) Any charges imposed by an upstream pipeline operator on or before the coming into operation of this section shall, subject to the approval of the Minister for the Marine and Natural Resources, continue in force until a statement has been approved of by that Minister under this section and thereafter all charges shall be in accordance with a statement approved of by that Minister.

(19) In this section-

'Directive' means Directive 98/30/EC1 of the European Parliament and of the Council of 22 June 1998 concerning the internal market in natural gas;

'pipeline' means an upstream pipeline and includes facilities supplying technical services incidental to acquiring access to such pipelines;

'upstream pipeline operator' means a person operating an upstream pipeline in accordance with a consent given by the Minister for the Marine and Natural Resources under section 40 (1).".

Amendment agreed to.

I move amendment No. 29:

In page 19, subsection (3) (b)(ii), line 6, to delete “pipeline operators or”.

Amendment agreed to.
Section 11, as amended, agreed to.
SECTION 12.

Amendments Nos. 30 and 53 are related and may be discussed together.

I move amendment No. 30:

In page 20, to delete lines 38 to 49.

Amendment agreed to.
Section 12, as amended, agreed to.
SECTION 13.

I move amendment No. 31:

In page 21, subsection (1), lines 10 to 14, to delete paragraph (a), and substitute the following:

"(a) the supply of natural gas to persons of a type mentioned in subsection (1) of section 10A (inserted by section 11) of the Gas Act, 1976, or to customers of a type mentioned in Article 19 of the Directive,”.

Amendment agreed to.

I move amendment No. 32:

In page 21, subsection (2), line 20, to delete "(£2,362.69)".

Amendment agreed to.

I move amendment No. 33:

In page 21, subsection (4)(a), line 26, after “subsection (2)”, to insert “or subsection (10) or both”.

Amendment agreed to.

I move amendment No. 34:

In page 22, lines 47 to 49, page 23, lines 1 to 47, and page 24, lines 1 to 22, to delete subsections (14) to (17) and substitute the following:

(14) (a) Where the Commission is satisfied that all or any of the circumstances set out in paragraph (b) have arisen or are likely to arise it may direct the holder of a natural gas licence, the holder of a consent given by the Minister, before the appointed day, under section 8(7) or 40(1) of the Gas Act, 1976, the holder of a consent given by the Commission under section 39A(1) of the Gas Act, 1976, a person in respect of whom an order has been made under section 2(1) of the Gas (Amendment) Act, 1987, a person undertaking an activity mentioned in regulations made by the Commission under subsection (4), or the Board, to discontinue or to refrain from specified practices.

(b) The circumstances referred to in paragraph (a) are where the Commission is of the opinion that:

(i) immediate action is necessary to protect-

(I) public health or safety or the environment,

(II) the continuity of supplies of natural gas, or

(III) the interests of other holders of natural gas licences or consents given under the Gas Act, 1976, or of other persons in respect of whom an order has been made under section 2(1) of the Gas (Amendment) Act, 1987, or undertaking an activity mentioned regulations made by the Commission under subsection (4),

(ii) the holder of a natural gas licence or a consent aforesaid, or a person in respect of whom an order has been made under section 2(1) of the Gas (Amendment) Act, 1987, is contravening or is likely to contravene a term, condition or requirement and immediate action is necessary to cease or prevent such contravention, or

(iii) immediate action is necessary to prevent dissipation of the assets of the holder of a natural gas licence or a consent aforesaid, or of a person in respect of whom an order has been made under section 2(1) of the Gas (Amendment) Act, 1987.

(c) Nothing in this subsection shall authorise the Commission to give directions relating to industrial disputes.

(15) Where the Commission is of the opinion that the holder of a natural gas licence or a consent given by the Minister, before the appointed day, under section 8(7) or 40(1) of the Gas Act, 1976, or a consent given by the Commission under 39A(1) of the Gas Act, 1976, or a person in respect of whom an order has been made under section 2(1) of the Gas (Amendment) Act, 1987, is contravening or is likely to contravene a term, condition or requirement, sections 24 to 26 of the Act of 1999 shall apply to any actions it may take.

(16) (a) In this subsection and in subsections (14) and (15) ’term, condition or requirement’ means-

(i) any term or condition of a natural gas licence,

(ii) any requirement imposed by or under this Act,

(iii) any conditions or requirements imposed by the Minister under subsection (8) or (9) of section 8, or section 40(3) of the Gas Act, 1976, or by the Commission under section 39A(4) (inserted by section 9) of the Gas Act, 1976, or

(iv) any duties or obligations conferred on a person by an order made under section 2(1) of the Gas (Amendment) Act, 1987.

(b) Where-

(i) the holder of a natural gas licence, a consent given by the Minister, before the appointed day, under section 8(7) or 40(1) of the Gas Act, 1976, a consent given by the Commission under section 39A(1) of the Gas Act, 1976, or a person in respect of whom an order has been made under section 2(1) of the Gas (Amendment) Act, 1987, requests the Commission to modify the terms, conditions or requirements of the licence, consent or order, or

(ii) the Commission is of the opinion that:

(I) a natural gas licence or consent aforesaid should be amended,

(II) a modification of a term, condition or requirement of a natural gas licence, consent or order aforesaid is a modification of a class required by an order of the Minister made under section 17, the Commission may modify the terms, conditions or requirements of the licence, consent or order concerned in accordance with sections 20 to 22 of the Act of 1999, and those sections shall, accordingly, be construed as including references to a natural gas licence, consent or order as aforesaid, where appropriate.

(17) Any reference-

(a) in sections 14(7), 29, 30 and 32 of the Act of 1999 to a licence shall be construed as including a reference to a natural gas licence and an order made under section 2(1) of the Gas (Amendment) Act, 1987,

(b) in sections 17(4), 29, 30 and 32 of the Act of 1999 to an authorisation shall be construed as including a reference to a consent of a type mentioned in section 8(7), 39A(1) or 40(1) of the Gas Act, 1976, other than a consent in regard to an upstream pipeline.”.

Will the Minister of State elaborate on this amendment?

This amendment seeks to amend subsections (14) to (17) of section 30. The text of the amendment is largely a restatement of what is already contained in these subsections. The only difference is the inclusion of references to persons exempted under section 13(4) from requiring a licence and persons who have town gas functions conferred on them by an order under section 2 of the 1987 Act.

By introducing these additional references the amendment seeks to ensure that the commission's powers under these subsections allow it to, for example, take action against such persons to safeguard public health or protect the continuity of supply of natural gas. It is important that the commission's power to take immediate action in situations of the type envisaged by these provisions extends to all persons engaged in natural gas related activities. This amendment will ensure that this is the case.

In addition, the amendment will ensure that, under subsection (15), the commission has the power to issue directions and obtain High Court orders to ensure compliance with such directions by persons who are contravening their duties or obligations under a town gas order made under section 2 of the 1987 Act. We discussed this issue in detail on Second Stage.

In conjunction with this power, the proposed amendment will ensure, under subsection (16), that the commission will have the power to modify the duties and obligations conferred on a person by an order made under section 2 of the 1987 Act and that in subsection (17) the relevant provisions of the Electricity Regulation Act apply regarding the notification of, and appeals against, such modifications. The inclusion of these latter changes is due to the certain limitations which pertain regarding the 1987 Act which was originally primarily aimed at facilitating the entry by BGE into the town gas market and is limited in the range of enforcement powers available to the regulatory authority. I am satisfied that the inclusion of persons covered by section 2 orders in these sections of the Bill satisfactorily addresses these limitations.

Amendment agreed to.
Section 13, as amended, agreed to.
Sections 14 to 16, inclusive, agreed to.
SECTION 17.

I move amendment No. 35:

In page 27, subsection (1), lines 3 to 4, to delete "on natural gas undertakings" and substitute "on such classes of natural gas undertakings as may be specified in the order".

Amendment agreed to.

Amendment No. 36 is consequential on amendment No. 37 and these amendments may be discussed together.

I move amendment No. 36:

In page 27, subsection (2)(b), line 18, to delete “order,” and substitute “order.”.

Amendment agreed to.

I move amendment No 37:

In page 27, subsection (2)(b), to delete lines 19 and 20.

Amendment agreed to.

I move amendment No. 38:

In page 27, subsection 3, line 21, to delete "subsection (2) and subject to subsection (4)” and substitute “the generality of subsection (2)”.

Amendment agreed to.
Section 17, as amended, agreed to.
SECTION 18.

I move amendment No. 39:

In page 28, subsection (1), after line 47, to insert the following:

"(c) in paragraph 16 of the Schedule after ’in the order.’ to insert the following sentence:

'Separate orders may be made under this paragraph in respect of electricity undertakings and natural gas undertakings.',".

Amendment agreed to.

I move amendment No. 40:

In page 29, subsection (2), line 19, after "before" to insert "or after".

Amendment agreed to.

I move amendment No. 41:

In page 30, subsection (1)(b), line 2, to delete “(£472.54)”.

Amendment agreed to.
Section 18, as amended, agreed to.
SECTION 19.

I move amendment No. 42:

In page 30, lines 18 and 19, to delete paragraph (d).

Amendment agreed to.

Amendments Nos. 56 to 58, inclusive, are consequential on amendment No. 43 and these amendments may be discussed together.

I move amendment No. 43:

In page 30, lines 20 to 23, to delete paragraph (e) and substitute the following:

"(e) in section 26-

(i) in subsection (1)(c), by the substitution for ’section 8(7) or 40(1) of this Act or, as the case may be, the giving of previous or reasonable notice under the said section 40(1),’ of ’section 39A(1) of this Act’, and

(ii) by the insertion after subsection (1) (as amended by section 20 of the Act of 2000) of the following subsection:

'(1A) Notwithstanding the generality of subsection (1), an authorised person may only enter land under this section for the purposes mentioned in paragraphs (c) and (d) of that subsection where-

(a) in the case of a pipeline other than an upstream pipeline, the Board has notified the Commission in writing of its intention to make an application for the Commission’s consent under section 39A(1) in relation to the construction of a pipeline and in respect of which notification the Commission provides a certificate to the Board, after having made such inquiries, if any, as the Commission thinks appropriate, stating that the notification demonstrates a bona fide intention on the part of the Board to make such an application, or

(b) in the case of an upstream pipeline, the Board has notified the Minister for the Marine and Natural Resources in writing of its intention to make an application for that Minister’s consent under section 40(1) in relation to the construction of a pipeline and in respect of which notification, that Minister provides a certificate to the Board, after having made such inquiries, if any, as that Minister thinks appropriate, stating that the notification demonstrates a bona fide intention on the part of the Board to make such an application.”’.

Amendment agreed to.

I move amendment No. 44:

In page 30, subsection (1)(g), line 37, to delete “(£472.54)”.

Amendment agreed to.

Amendments Nos. 45 and 59 are related and may be discussed together.

I move amendment No. 45:

In page 30, lines 38 to 40, to delete paragraph (h) and substitute the following:

"(h) in section 32-

(i) by the substitution for subsection (1A) (inserted by section 20 of the Act of 2000) of the following:

'(1A) (a) A person may apply to the appropriate Minister of the Government for an order under this section (which order is in this Act also referred to as an “acquisition order“) to acquire compulsorily any land or right over land which is required by such person in connection with the construction or operation of a pipeline for which such person applies or has applied for a consent under section 39A or 40 of this Act, as the case may be, and, subject to the following provisions of this section, the appropriate Minister of the Government may make an acquisition order in relation to the land or right over the land.

(b) In this subsection “appropriate Minister of the Government” means-

(i) in the case of an upstream pipeline, the Minister for the Marine and Natural Resources, and

(ii) in any other case, the Minister.',

and

(ii) in subsection (3), by the substitution for 'Minister for Lands and the Commission' of 'Minister for Agriculture, Food and Rural Development',".

Amendment agreed to.

I move amendment No. 46:

In page 30, subsection (1)(i), line 42, to delete "(£1,575.13)".

Amendment agreed to.

I move amendment No. 47:

In page 31, subsection (1)(l)(iii), line 32, to delete “(£1,575.13)”.

Amendment agreed to.

I move amendment No. 48:

In page 31, subsection (1)(l)(v)(II), line 40, to delete “(£393.78)”.

Amendment agreed to.

Amendments Nos. 49 and 51 are related and may be discussed together.

I move amendment No. 49:

In page 32, to delete lines 2 and 3 and substitute the following:

"(i) in subsection (1), by the substitution for 'may by order confer on the Board' of 'may by order confer, or may refuse to confer, on one or more persons, including the Board, concurrently',".

Amendment agreed to.

I move amendment No. 50:

In page 32, to delete lines 7 to 17 and substitute the following:

"(iii) by the deletion of subsection (3),".

Amendment agreed to.

I move amendment No. 51:

In page 32, between lines 17 and 18, to insert the following:

"(iv) by the insertion after subsection (5) of the following subsection:

'(5A) Without prejudice to the generality of subsection (1) of this section, the Commission-

(a) may refuse to make an order under that subsection conferring functions in relation to the provision of pipelines in a particular area where it determines that the capacity of existing or proposed distribution or transmission pipelines in that area provided or proposed to be provided by any person, including the Board, who is subject to an existing order under that subsection in relation to that area, represents adequate provision for reasonable expectation of demand,

(b) shall refuse to make an order under that subsection conferring functions on a person, including the Board, in relation to the sale and supply of gas in a particular area in addition to an existing order conferring such functions on any other person, including the Board, in regard to that area until such time as the annual rate prescribed in section 10A(1)(d) of the Principal Act stands at zero standard cubic metres per annum, and

(c) shall, solely, determine what constitutes a “proposed distribution or transmission pipeline” and “reasonable expectation of demand” in paragraph (a) of this subsection.’.”.

Amendment agreed to.

I move amendment No. 52:

In page 32, line 19, to delete "39A(4)" and substitute "39A(1)".

Amendment agreed to.

I move amendment No. 53:

In page 32, to delete lines 26 to 32 and substitute the following:

" '(6A) (a) The Commission may, from time to time, examine charges, and the costs underlying such charges, or any proposals to alter such charges, for natural gas supplied to customers by a person, including the Board, in accordance with functions conferred on that person or the Board, as the case may be, by an order under subsection (1) of this section.

(b) Where it considers it necessary following an examination under paragraph (a) of this subsection, the Commission shall issue a direction to the person or the Board in relation to either or both the nature and the amount of any charge or proposed charge referred to in that paragraph and the person or the Board, as the case may be, shall comply with such a direction.”’.

Amendment agreed to.

I move amendment No. 54:

In page 32, to delete lines 35 to 49, and in page 33, to delete lines 1 to 12 and substitute the following:

" '2A.-(1) Where the Commission considers it appropriate, it may conduct a competitive process for the purpose of selecting an applicant in respect of whom an order under subsection (1) of section 2 of this Act may be made.

(2) The Commission may make regulations relating to the conduct of such a competitive process, and such regulations may include-

(a) the period of time allowed for the submission of expressions of interest by prospective applicants,

(b) the criteria for the pre-qualification of applicants,

(c) the period of time allowed for the submission of applications,

(d) the criteria by which applications will be adjudicated,

(e) the terms and conditions that may be applied in relation to the successful applicant,

(f) the lodging of a bond (if any) by the successful applicant, and

(g) any other matter which the Commission considers appropriate and necessary for the holding of a competitive process under subsection (1) of this section.

(3) Where a competitive process is conducted under this section, the Commission shall not be obliged to select an applicant where it considers that no applicant is suitable.'.".

Amendment agreed to.

I move amendment No. 55:

In page 33, subsection (5)(b), line 26, to delete “15” and substitute “16”.

Amendment agreed to.

I move amendment No. 56:

In page 34, line 12, to delete "and".

Amendment agreed to.

I move amendment No. 57:

In page 35, line 6, to delete "application.'." and substitute "application.', and".

Amendment agreed to.

I move amendment No. 58:

In page 35, between lines 6 and 7, to insert the following:

"(iii) in subsection (2), by the insertion after 'by a relevant person and those provisions' of ', other than section 26(1A),'.".

Amendment agreed to.
Section 19, as amended, agreed to.
NEW SECTION.

I move amendment No. 59:

In page 35, before the Schedule, to insert the following new section:

20.-The European Communities (Internal Market in Natural Gas) (Compulsory Acquisition) Regulations 2001 (S.I. No. 517 of 2001) are revoked.".

Amendment agreed to.
SCHEDULE.

I move amendment No. 60:

In page 35, line 8, to delete "to be" and substitute "under Acts".

Amendment agreed to.
Schedule, as amended, agreed to.
Title agreed to.
Bill reported with amendments.

I thank Deputies Higgins, Roche and Power for their participation and co-operation on Committee Stage. I also thank the Minister of State and his staff for the assistance they have given the committee on this matter.

Before adjourning I wish to say a genuine word of thanks to the Chairman and his excellent colleagues for their courtesy and effectiveness in the dealings I have had with them on the many occasions I have appeared before the committee over the past five years. I thank them also for helping us to process this Bill. I thank my officials, in particular. This is complex legislation which I am pleased to have got this far. It would not have been possible to do so without the help of my colleagues in the room. I thank Deputies Higgins, Stanton and Stagg, in particular, for their excellence throughout the process and look forward to finalising with them this important and urgent legislation.

In regard to the date set for taking the revised Estimates, that is, Tuesday, 26 March, perhaps the Chairman will flag to us as early as possible when the Minister will be available in order that we can make due plans.

Absolutely, I will endeavour to do so. I take this opportunity, in the context of the legislation, to thank the Clerk to the committee, Mr. Donlon, and his assistant, Jennie.