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Lord Graham of Edmonton: I am grateful to the Minister for being so frank. He has said that it is possible that people will misuse or abuse the exemptions and the risk that the recipients of exemptions may become cavalier. That is well understood and it is a possibility. I think the Government are really saying that they are not prepared to risk the possibility.
This may be a huge issue but I am not competent to argue it in detail. I am sure the Minister has good grounds both for the words in the Bill and his explanation, which I found compelling but not completely acceptable. I shall take away the words he has used and consult colleagues. It may be that they will come back to the matter at a later stage. In the meantime, I beg leave to withdraw the amendment and wish the Committee good night.
Amendment, by leave, withdrawn.
[Amendments Nos. 59 to 61 not moved.]
[Amendments Nos. 62 and 63 not moved.]
Clause 7 [Block exemptions: opposition]:
Lord Kingsland moved Amendment No. 64:
The noble Lord said: In moving this amendment perhaps I may also speak to Amendments Nos. 73 to 76, 81, 83 to 85, 87 and 93. The first set of amendments concerns block exemptions in Clause 7. The general intention of all the amendments is to reduce the element of uncertainty for the alleged offender.
Amendment No. 64 introduces a period of three months in place of the expression,
That is a very open-ended expression and could leave the alleged offender in doubt for a long time.
Amendment No. 73 is to page 7, line 41 of the Bill. The Bill presently reads:
If the amendment were accepted the Bill would read:
Amendment No. 74 substitutes the word "shall" for "may" on page 8, line 20. If agreed the Bill would read:
Amendment No. 75 seeks to insert at the end of line 20, page 8,
Amendment No. 76 seeks to insert at the end of Clause 14 (2) a new subsection (3):
I turn to Amendment No. 83. Clause 21 (2) states:
Amendment No. 83 seeks to leave out "may" in page 11, line 20 and insert "shall".
Amendment No. 84 seeks to substitute "shall" for "may" in page 11, line 27 of Clause 22 (2).
Amendment No. 87 seeks to insert on page 11, line 31, at end:
Finally, Amendment No. 93 proposes, on page 55, line 3 of the Bill, to add the expression,
It has been the experience of the competition authorities in the European Community that it sometimes takes a very long time before a company knows where it stands under the competition rules. It seems to me that we could set a good example to the Community by not allowing our competition officials to fall into the same trap and leave our own companies in a period of long and unacceptable uncertainty. I beg to move.
Lord Haskel: We are certainly keen to ensure that the prohibition regime operates efficiently. We agree with the noble Lord that, however long time, delays are inadvisable. They are bad for business and the economy. I appreciate the noble Lord's concern to ensure that the director does not delay in making decisions. It is of course important that business and consumers are not kept waiting for long periods. As the noble Lord pointed out, that uncertainty would be counter-productive.
However, it would be dangerous to impose a time limit of three months on the director. For example, when determining notification for a decision he may have to conduct a complex and detailed investigation of the economic and legal issues. He will wish to seek representations of third parties as part of his consideration. The effect of these amendments is that where he is unable to come to such a decision within three months, the agreement or conduct in question would be deemed not to infringe the prohibitions. We do not wish the director to be forced to make rushed decisions.
The Bill already makes provision to ensure that there is no undue delay in decisions made by the director which are expected to be brought into force once the system has bedded down. Both Schedules 5 and 6 make provisions which allow persons aggrieved by the failure of the director to determine an application for a decision to apply to a court for directions to secure that the application is considered without further delay.
Furthermore, Clause 49 enables the director to make rules on procedural and other matters. Schedule 9 elaborates on the kind of rules that can be made. Members of the Committee will see that paragraph 2(c) of that schedule makes specific reference to the possibility of rules making provisions for applications, whether for guidance or decision, to be dealt with in accordance with a timetable. I am sure that Members of the Committee will understand that until the system has bedded down and we have an idea of the volume
Equally, if we were to remove the director's discretion to give guidance the new regime would be damaged. We should be clear that in some cases the issues may not be black or white. In particular, in the case of guidance the application will not be published and the director will have no opportunity to consider what views third parties might have on an agreement. Were they aware of it? It would be quite wrong to tie the director down by forcing him to give guidance.
However, I can quite see the business interest in guidance being given promptly. Clause 49 enables the director to make rules on procedural and other matters. Schedule 9 elaborates on the kinds of rules that can be made. Members of the Committee will see that paragraph 2(c) of the schedule makes specific reference to rules making provisions for applications whether for guidance or a decision. I would expect such rules to deal with those concerns. In the light of these remarks, I hope that the noble Lord will feel able to withdraw his amendment.
Lord Kingsland: Is the Minister saying that in formulating the detailed rules that will apply to the procedure that the director general has to respect, specific time limits will be entertained?
Lord Haskel: I am saying that at this stage we do not think it a good idea to tie the director general down but, once the system has been bedded down, we may consider the matter further.
Lord Kingsland: At the risk at this time of night of irritating the Committee, perhaps I may address just one more question to the Minister. As I understand it from what he has said, the intention is to look at the experience (presumably over a period of, say, one year after the system has come into operation) and, in the light of that, to consider specific time limits. I say that because leaving many of these matters open-ended will pose great difficulties for the industry which will not know where it stands with regard to the competition regime. I should like to hear the Minister say that he accepts the approach of fixed time limits as a matter of principle.
Lord Haskel: What I can say is that the Bill already makes provision to ensure that there is no undue delay in decisions taken by the director. I expect to bring that into force once the system has bedded down.
Lord Kingsland: I appreciate the fact that the Minister has responded so frequently on this. I shall reflect on his replies in the cold light of dawn--well, perhaps not quite dawn!--but, in the circumstances, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 8 [Block exemptions: procedure]:
Lord Berkeley had given notice of his intention to move Amendment No. 65:
The noble Lord said: On the basis of my noble friend's explanations of my previous two amendments, I do not propose to move this amendment.
Clause 9 [The criteria for individual and block exemptions]:
[Amendments Nos. 66 and 67 not moved.]
Clause 10 [Parallel exemptions]:
Page 5, line 12, leave out from ("means") to end of line 14 and insert ("three months").
"such period as may be specified with a view to giving the Director sufficient time to consider whether to oppose under subsection (2)".
"On an application under this section, the Director may give the applicant guidance".
"On an application under this section, the Director must promptly give the applicant guidance".
"On an application under this section, the Director shall make a decision".
"within a period of three months".
"If no decision has been made under subsection (2) after a period of three months the Chapter I prohibition shall be deemed not to apply to the notified agreement".
"On an application under this section, the Director may give the applicant guidance as to whether or not, in his view, the conduct is likely to infringe the Chapter II prohibition".
"If no decision has been made under subsection (2) after a period of three months the Chapter II prohibition shall be deemed not to apply to the notified agreement".
"An application for a decision shall be determined within a period of three months from the date of notification, and where no determination has been made within the three month period the conduct shall be deemed not to infringe the Chapter II prohibition".
10.15 p.m.
Page 5, line 15, after ("Before") insert ("granting an exemption under section 4 or ").
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