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Mr. Deputy Speaker (Mr. Michael J. Martin): Order. As the hon. Gentleman said, I have just taken the Chair. However, I should draw it to his attention that we are considering narrow amendments. The hon. Gentleman appears to be referring to a treaty. Can he explain what that treaty has to do with the two amendments before us?

Mr. Letwin: I was not interrupted by your predecessor, Mr. Deputy Speaker, because I explained the relevance of the treaty at the beginning of my speech. So as not to try your patience, let me briefly repeat the logic of my argument; it is very straightforward. The amendment seeks to protect resale price maintenance, which was being advocated by a particular group. That group has withdrawn part of its advocacy of that on the basis of a letter from the Commission to which the Minister has referred. The letter is meant to have some treaty basis, which I believe is article 85. I have been asserting that

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the Minister concocted the letter from the Commission in order to change the attitude of that group to resale price maintenance--and hence the necessity of the amendment. That is the structure of my argument.

In conclusion, I repeat that if any leg of my argument is false, it falls to the Minister to show it. It is for him to show that article 85 is not the treaty base, that I have misinterpreted its scope or effect, or that the Commission genuinely acted on its own initiative and is at fault because he can show that he tried to get the letter withdrawn.

Mr. Nigel Griffiths: It is, indeed, unusual to hear the Opposition filibustering on their own amendment, but the amendment relates to a subject that is particularly embarrassing to them. It is a subject that they ignored for years--the plight of community pharmacists. Indeed, when the right hon. Member for Wokingham (Mr. Redwood) was in the Cabinet, 178 pharmacists ceased trading.

The Opposition have had no long-standing dialogue with community pharmacists, and, in speaking to the amendment and the new clause, cannot command their support. They asked us about representations and I shall be happy to deal with that, along with the treaty basis for what is happening. The right hon. Member for Wokingham made no representations to the Director General of Fair Trading about the complaint. In 1996, when the Commission was liaising with the Office of Fair Trading in respect of the Asda complaint, the right hon. Gentleman was too busy with the downfall of his own Government to make any representations to Brussels. I understand that he has made no representations on the matter, either to the Office of Fair Trading or to the Commission, during the passage of the Bill or previously. We will take no lessons from the Opposition about commitments to community pharmacists.

As my right hon. Friend the President of the Board of Trade told the House:


The amendment and the new clause put at risk all the representations made to the OFT and the Commission.

The right hon. Member for Wokingham does not care whether amendment No. 2, which is, after all, a political stunt, puts at risk all that community pharmacists have been fighting for. It would disapply the prohibition and effectively pre-empt the findings of the restrictive practices court. It is carelessly drafted in that it does not distinguish between retail price maintenance agreements in the over-the-counter medicine sector which are exempt under section 14 of the Resale Prices Act 1976 and all other retail price maintenance agreements. New clause 4 refers to agreements that have been exempted from section 14. Both proposals would have the effect of stopping proceedings in the United Kingdom and handing them over to Brussels--coming from the right hon. Member for Wokingham, that is a paradox.

The Commission has made it perfectly clear that article 85 is directly applicable in the United Kingdom, irrespective of the Bill. On several occasions in Committee, Opposition Members highlighted the fact that an agreement of conduct must have an appreciable effect

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on trade between member states if articles 85 and 86 are to apply. They went on to argue--as they have this evening--that that requirement somehow makes the competition test for the application of the domestic prohibition different from that for the application of article 85. The right hon. Member for Wokingham nods in agreement, but that view is mistaken.

The hon. Member for West Dorset (Mr. Letwin) asked whether he was wrong and I can confirm that he is wrong on that and most of the other matters that he raised.

6.45 pm

Mr. Letwin: Will the Minister give way?

Mr. Griffiths: I shall give way in a moment, with great pleasure.

The requirement that the application of article 85 would affect interstate trade is a jurisdictional hurdle. It does not affect the meaning of the prohibition itself in the sense of determining whether or not an agreement is anti-competitive. Nor does it affect the meaning of the prohibition in determining whether conduct is abusive of a dominant position.

Mr. Letwin: The Minister has made some quite remarkable statements. First, he has admitted that article 85 is the treaty base. Secondly, does he agree that if article 85 has the scope that he claims for it, the reason for the clause that creates a prohibition under English law is nullified? He has undermined the whole purpose of his own legislation.

Mr. Griffiths: The hon. Gentleman had left the Standing Committee at that stage, as he put his career before chemists. He also sought to spare the Opposition the embarrassment of the publication in the 1980s that he and the right hon. Member for Wokingham produced on financing the health service. Their report is germane to today's debate on community pharmacists, as it advocated a pill tax. They wanted to ensure that the prescriptions that are the life-blood of so many chemists were operated, if not for profit, at least by charging enough to ensure that demand matched supply. So the hon. Gentleman's history is certainly not in support of community pharmacists--which is why Opposition Members have shown absolutely no interest in the issue for so long.

Mr. Letwin: Will the Minister give way?

Mr. Griffiths: I shall make some progress, but I shall give way to the hon. Gentleman before I sit down.

It is important to be aware that the proposals would stop proceedings in the United Kingdom. The Commission has made it clear--not just to the Government but to the Director General of Fair Trading, with whom it has been liaising for more than two years on the matter--that if that happened, it would have to take action. It did so under the previous Administration, without a finger being lifted by Ministers or Conservative Back Benchers at the time to support community pharmacists. I can confirm, as I have it here, that a letter from the Commission was sent to the Director General of Fair Trading. I am sure that it is part of one of a number of dialogues over the past two years since Asda lodged its complaint in 1995.

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Amendment No.2 would have dire consequences. The Commission has made it clear that if the restrictive practices court were not looking at the issue, it would take lock, stock and barrel the evidence that the Office of Fair Trading has collected over a long time. Let us look at just how long it can take for the Commission to act. A recent investigation into the Italian tobacco sector took around two years. The decision on Volkswagen took around three years. That means that the present arrangements could unravel alarmingly quickly for community pharmacists.

The Bill provides a five-year transitional period if the court decides that there should be an exemption for over-the-counter medicines. I urge my hon. Friends to reject the amendment and the new clause.

Mr. Lansley: The Minister will know that the letter from the Commission on 8 May related to whether proceedings before the court were stayed under the previous amendment tabled in another place. When the court's proceedings continue, will the Commission investigate and intervene on RPM on over-the-counter medicines if the chapter I prohibition in this country is not applied but the court's decision is sustained?

Mr. Griffiths: The Commission has made it very clear that, if the court comes to a decision that the community pharmacies deem favourable--the same decision at which it arrived, having weighed up the evidence, the last time that it considered the matter--and if due processes have been followed, it should be satisfied. That is an important point. We went into this matter in some detail in Committee.

Mr. Lansley rose--

Mr. Griffiths: I shall not let the hon. Gentleman detain the House further, given that his questions as a member of the Committee that considered the Bill were answered.

The do-nothings when they were in government are lecturing us about doing something. Owing to the inadequacies of Opposition Members' explanations in favour of the amendment and the new clause and the patent lack of support from the Community Pharmacy Action Group, I urge the House to reject the amendments.

Mr. Letwin: I hope that the Minister will answer this question. If he is saying that article 85 extends into activities that do not affect interstate trade, how can the prohibition clause that he is enacting be necessary?


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