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Lord Desai: My Lords, I take it that the noble and learned Lord prefers either Amendment No. 159 or No. 165. I think that Amendment No. 159 is better because Amendment No. 165 would add too many advisory boards.

The noble and learned Lord referred to concurrency. While that is an important issue, I am not clear that the amendment will deal with it. I shall clarify the problem. I believe that the concurrency problem will arise. At Second Reading I said that we should have an over-arching regulatory body rather than Snow White and the Seven Dwarfs, as it were. I do not see that the advisory board that the noble and learned Lord proposes will have any binding power to say, "This is our judgement and therefore this particular problem falls in the path of a sectoral regulator". If it is not to have that kind of power, I do not know that the advisory body will add much more to what the director general and various other regulators already seek by way of informal advice on a retail basis from time to time. That is my only comment.

Lord Simon of Highbury: My Lords, I am grateful to the noble and learned Lord, Lord Fraser, for pointing out that there is an article in The Times today on this

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subject. I shall hasten to read it. Perhaps in view of recent debates I have not been reading the paper as closely as I should have done. In any case, the thinking is not that with which I would be totally at one.

I believe that the thinking behind Amendments Nos. 159 and 165 although clear is flawed. The noble and learned Lord has, in my view, underestimated the mechanisms in the Bill for ensuring that the director takes account of the views of those affected when he exercises his powers, and for ensuring that his decisions may be appealed. The advisory bodies proposed in the amendments would also, if I may say so, add an unnecessary layer to the decision-making process, particularly that suggested at Amendment No. 159. I shall return to Amendment No. 165.

The Bill already makes provision to make the director accountable for his actions and to oblige him to take into account the views of affected persons. He must publish applications for decisions, consult those likely to be affected and take into account their views--I refer to paragraph 5, Schedules 5 and 6. In investigation cases he must give written notice to those most likely to be affected and provide them with an opportunity to present their case--I refer to Clause 31. Most importantly, his decisions may be appealed by the parties concerned, affected third parties and their representative bodies. The appeals tribunal may conduct a full rehearing of the merits of the case. Thereafter, appeal lies on a point of law to the Court of Appeal and your Lordships' House, as noble Lords are aware.

It is worth pointing out that the accountability mechanisms are much more extensive than those which exist at EC level. In contrast to the full rehearing of the case by the appeals tribunal, the European Court of Justice is in certain respects more akin to judicial review. Similarly, the class of third parties which can appeal a director's decision is highly likely to be wider than the class which may appeal Commission decisions.

The noble and learned Lord mentioned the advisory body for Oftel. It is true that it was established to advise on the application of the fair trading conditions in licences granted under the Telecommunications Act, which are similar to the prohibitions in the Bill. But under the Telecommunications Act there is no comparable appeal body to that established under the Bill. The situation is therefore quite different.

I find it difficult to see what benefit can be gained by adding an additional layer to the decision-making process as suggested by these amendments. That is not to discuss the issue of concurrency formally; I quite understand that there are separate arguments that will run this evening in relation to concurrency. My submission is that the noble and learned Lord's submission will only add a layer to the consultative process, which has already benefited from the way in which we have shaped and structured the Bill. I have tried to explain why I believe the position of Oftel is different; namely, that there is no recourse to appeal in its circumstance as there is in the circumstances of the Bill. I hope therefore that on reflection the noble and learned Lord will recognise that and not press his amendments.

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6.30 p.m.

Lord Fraser of Carmyllie: My Lords, first, perhaps I may say to the noble Lord, Lord Desai, that I entirely agree with him. The establishment of an advisory body, whether under the proposal in Amendment No. 159 or my alternative proposal in Amendment No. 165, does not eliminate the problem of concurrency. However, if the policy is to be that concurrency should exist, it would seem to us desirable to avoid the duplication and inconsistencies which we would predict, unhappily, are almost inevitable, and that there should be a single advisory body to do what it could to avoid that. I return to the particular example I used. If Oftel already has an advisory body, advising specifically on where Articles 85 and 86 might impact on conditions in licences, it is to be presumed that the other regulators will wish to address much the same problem. If they are going to do that, there would seem to be a powerful case for there being a single body providing that advice rather than up to eight separate bodies on this technical matter.

The noble Lord, Lord Simon, has a good point in this respect. I would certainly not wish there to be an additional layer. I appreciate that it would be something of an absurdity if Oftel had its own advisory committee on Articles 85 and 86 and there was also a broad regulator's one also offering advice on those articles. If that is the noble Lord's only objection, I believe that I can go away and table amendments before Third Reading to eliminate the right of Oftel and others to have their own separate independent advisory bodies. I shall withdraw the amendment. I wish to reflect on the noble Lord's remarks. I did not quite understand his point about there being rights of appeal under the Bill. No doubt it is my fault, but I shall want to read those remarks carefully in order to determine whether or not we wish to return to the matter at Third Reading. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 49 [Rules]:

Lord Kingsland moved Amendment No. 159A:

Page 24, line 40, at end insert--
("( ) The Director shall, prior to the coming into force of section 52, make rules under this section which specify (by means of objective criteria set out in those rules) the circumstances in which the Director rather than a regulator shall exercise the powers conferred by or under Part I.").

The noble Lord said: My Lords, Amendments Nos. 159A, 170, 171, 171B and 225 all refer to the problem of overlapping jurisdiction between the Director General of Fair Trading on the one hand and the individual regulators on the other when enforcing their competition responsibilities. Amendment No. 164E refers to a much wider matter which reflects an amendment made by the noble Lord, Lord Ezra, in Committee.

As the Minister is only too well aware, the problem of concurrency has a number of manifestations. Much of this evening's debate will be about those. This particular one relates to which regulator--or, if not a regulator, the director--is responsible for a particular alleged anti-competitive activity.

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Of course it is simple if a matter is within the gas sphere, once a satisfactory definition of "gas" has been decided on, or within the electricity sphere, once a satisfactory definition of "electricity" has been decided, and so on. But, as the Minister knows, the real world is not like that at all--especially when we are seeing the growth of utility conglomerates and we know that many of these agreements will cross the lines of responsibility of the regulators. Which regulator should be responsible?

That is not merely an academic question. Since it is proposed to give individual regulators concurrent jurisdiction enabling them to exercise both regulatory and competition power at the same time, which regulator might determine the degree of severity with which he enforces his powers? If it becomes known that the gas regulator is "softer" on competitive matters than the electricity regulator, or that both are softer than another regulator, it is almost certain to lead to forum shopping by the regulatees. In order to prevent that, these amendments seek to establish ab initio and a priori a means of dividing up responsibilities. It is the belief of Her Majesty's Opposition that the rules for that dividing up should be clear and determined, and known to this House before the Bill becomes law.

In the course of the Committee stage, I recall the Minister referring to the undesirability of a hierarchy of powers. However, I should like him to reflect for a moment on any other solution but a hierarchy. The great danger that the Minister faces is that this Bill will be applied in seven or eight different ways by seven or eight different people, which will, quite apart from the discomfort of the regulatees, cause enormous confusion to the appeal courts which can apply only one set of rules; namely, the rules in the Bill.

I therefore say to the Minister that what is required is some careful thought about where the boundaries ought to lie, and some clear, at least draft, rules before the Bill becomes law setting out those boundaries beyond peradventure. I beg to move.

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