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Lord Haskel: As the noble and learned Lord said, Amendment No. 205A returns to the issue of the status of the rules made by the director under Clause 49, and of the information and advice issued by the director under Clause 50. Perhaps I may deal first with the question of the director's information and advice and then with the tribunal. We have already discussed the reasons for not giving legal force to his general advice, and I will not restate them here. However, if I am correct, the purpose of this amendment appears to be only that the tribunal and the courts should "take account of" this information and advice, and not that they should be bound by it.

I entirely agree that the appeal tribunal and the courts should have to take account of the general information and advice issued by the director, when assessing cases. However, I am advised that this is the position under the Bill as it already stands. The director's views, as expressed in his general advice, would have considerable persuasive effect in the tribunal and the courts. This being the case, it would be unhelpful to make express provision in the Bill. Such a provision would only beg the question as to the intention behind the provision, over and above what the Bill would do anyway.

I turn now to the question of the procedural rules issued by the director. It is already the case under the Bill that the tribunal or the courts would be able to overturn a decision of the director on the grounds that he had failed to follow the rules, if that failure was material to the decision.

Turning to the question of the tribunal, the tribunal and the courts would be expected to take account of the information and advice issued by the director under Clause 50. Moreover, the tribunal or the courts must have regard to the guidance issued by the director under Clause 37 on the appropriate level of penalty. We would expect such guidance to say that if a firm had been acting in accordance with the general advice issued by the director under Clause 50, little or no penalty should be imposed on it, even if it is eventually found to have infringed one of the prohibitions. I hope that that explanation satisfies the noble and learned Lord and that he will be prepared to withdraw his amendment.

Lord Fraser of Carmyllie: I shall certainly seek to withdraw my amendment. However, the answer just provided by the noble Lord invites a further amendment when the matter gets to Report stage. I had not appreciated before that guidance was used in some parts of the Bill and advice and information was used in others. Perhaps at a later date one might usefully probe

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the fine distinction to be drawn between the activities of the director in providing guidance on the one hand and advice and information on the other. I am grateful to the noble Lord. He will appreciate that this is a matter to be taken into account. Some concerns have been expressed to us on this matter and it is as well to understand and have on the record what the Government propose to do in the Bill. With those remarks, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 51 [Fees]:

On Question, Whether Clause 51 shall stand part of the Bill?

Lord Borrie: I should like to ask a question on Clause 51 which is not subject to any amendments. My question is concerned with fees. Can the Minister say how fees will affect firms of different sizes and whether the size of the fees will reflect ability to pay?

Lord Haskel: The question of any fees under Clause 51 relating to a person's ability to pay has been put to us by the Competition Law Association. We are considering whether the power in the clause might be broadened, in particular to allow different charges to be set for different persons, for example relating to their turnover. This matter is under consideration.

Clause 51 agreed to.

5.45 p.m.

Clause 52 [Regulators]:

Lord Ezra moved Amendment No. 206:

Page 26, line 6, leave out from ("10") to end of line 7 and insert ("makes consequential provision in relation to the functions of regulators.").

The noble Lord said: We come to the important question of the concurrent exercise of functions under the Bill by the utility regulators. The essential amendment is Amendment No. 206. A rather impressive array of amendments is grouped with it but all of them are consequential amendments in Schedule 10. The key amendment is Amendment No. 206. The purpose of this amendment is to ensure that the functions of the director general under the Bill are not exercised concurrently by the seven sectoral regulators referred to in Paragraph 1 of Schedule 10. The effect of these amendments is to separate the statutory regimes for the regulation of water, electricity, gas, rail and telecommunications from the new competition law introduced by the Bill. The amendments would not affect the substantive provisions in the Bill.

There are three main reasons for these amendments. First, there is a need to promote consistency and avoid overlapping jurisdictions. With eight different UK authorities exercising jurisdiction under the Bill there would undoubtedly be a risk of inconsistent interpretations and applications of the Chapters I and II prohibitions. The likelihood of overlapping jurisdictions would cause not only inconsistency but also uncertainty and possible conflict.

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Secondly, the Government are now conducting a review of legislation. Their conclusions are unlikely to be published before the early part of next year. A consultation period will follow and important changes in the regulatory system may ensue. It would surely not be desirable to give regulators within the existing regime additional powers under the Competition Bill until the regulatory system had been clarified by this review.

Thirdly, there is the question of conglomerates. With the opening up of the utilities market a number of companies cover more than one sector. For example, there are companies that now cover electricity, gas and water. It is quite possible that they will also cover telecommunications and railways. The emergence of these conglomerates can well raise questions about which particular regulator should act in connection with the Competition Bill. It may well be that the competitive problem will stray over the boundaries of one sector into the areas of one or more other sectors. How do they set about deciding who should deal with it? Do they just have an informal lunch and decide that A, B or C should take it on? Do they deal with it jointly or promptly hand it back to where I believe it should belong anyway--the Director General of Fair Trading? Clearly, this uncertainty, which I believe will grow as time goes on with the evolution of the market, would be avoided if the amendment proposed were agreed to.

If the director general were given this authority--which I believe properly belongs to him--he would necessarily consult the regulators when it was appropriate. If a conglomerate was being dealt with he would consult more than one regulator. I suggest that this is an amendment that will improve the effectiveness of the Bill and take account of the realities of the evolving market place. I beg to move.

Lord Desai: Although my name does not appear on the face of this amendment I rise to support it. During Second Reading I said that sooner or later in the competition field we would need an overarching structure. I drew an analogy with the FSA. For a while we messed about with SROs in different parts of the City. We finally found that overlapping jurisdiction and other matters required us to go for an overarching structure. I know that that analogy is not exact, but I believe that we are entering the same kind of phase in the Competition Bill.

The amendment in the name of the noble Lords, Lord Ezra, Lord Kingsland and Lord St. John of Bletso, is not a positive accumulation of power. It is being said that we should sort it out nicely at the initial stage of the Competition Bill so that we do not have a problem in the future. I believe that from that point of view it is very desirable because it introduces an element of co-ordination and avoids overlap. But, given the pace of technological innovation in this field, sectoral boundaries are bound to become very peculiar indeed. One will have conglomerates, changing technologies and many more overlaps. If the Government are minded to accept this amendment it will make life in future

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much easier; otherwise, they will have to introduce more primary legislation at a later stage in this Parliament, which would not be a good thing.

Lord Mottistone: I am very concerned about another aspect--the telecommunications field. Together with other noble Lords, I was very much involved in the passing of the Telecommunications Act 1984. My concern then was that it did not go far enough in ensuring that British Telecom was properly competitive. I found it strange that 3 per cent. of the market which was specifically provided for Mercury had such a far-reaching effect. Indeed, it changed British Telecom from one of the doziest public affairs into a quite competent--but not yet competent enough--telecommunications business.

I am concerned about all of the amendments linked with Amendment No. 206, those linked with Amendment No. 207 and many others in this part of the Bill. I understand the arguments put by the noble Lord, Lord Ezra. Perhaps this is something to which the Government should give very careful thought. I suspect that they have done so already in that they have endeavoured to draft the Bill so that it goes as far as it can at this stage in this particular area. It will take time for this new legislation to take full effect. It is important to realise that it would be exceptionally dangerous if the regulators' powers were diminished, particularly as a result of the amendment of the noble Lord, Lord Ezra, Amendment No. 210, which strikes at the very powers of Oftel.

We should not arrive at a situation where British Telecom could happily say: "We are the experts in this field; we do not have a regulator with any powers left; we know our subject, and the Office of Fair Trading will listen to us because we are the only experts". I detect that that kind of feeling will arise if these groups of amendments are accepted by the Government. Therefore I hope that the noble Lords will withdraw their amendments and think again about how important the regulators are at this moment. That is the point.

There may come a time when they will not be necessary. Amendment No. 211 talks about powers existing until 2001. That is four years away. In 2001 we shall see whether the regulators have too much power, and that will be the time for further legislation to restrain them, if necessary. Now is not the time and I hope that the amendments will not see their way onto the statute book.

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