Enterprise Bill

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Mr. Lansley: The Under-Secretary has helpfully answered limb No. 1 of my question. However, I was essentially putting to her a hypothetical situation: the OFT has said that there are no competition grounds for reference and, given advice under clause 42(6), public interest grounds do not merit a reference. Is she saying that she wants the Secretary of State to have the discretion to make a reference where there are no competition grounds and the OFT advises that there are no public interest grounds either?

Miss Johnson: I believe that the answer to that is yes. The OFT has competition expertise and it is right that the Secretary of State, whose view on a public interest test is important, should be determinative in such cases. I hope that I have clarified the point for the hon. Gentleman.

Question put and agreed to.

Clause 43 ordered to stand part of the Bill.

Clause 44

References under section 43: supplementary

Miss Johnson: I beg to move amendment No. 263, in page 30, line 33, leave out ''that section'' and insert ''section 43''.

I commend the amendment to the Committee. It seeks to clarify that the Competition Commission will consider relevant customer benefits only where it has identified a substantial lessening of competition. The purpose of taking account of relevant customer benefits is to ensure that the authorities have regard to them in light of the detriment created by any substantial lessening of competition. Where there is no such lessening, the case will be decided on the relevant public interest considerations only.

I am sorry, Mr. Conway. I have just spoken to amendment No. 180 instead of amendment No. 263, for which I apologise to the Committee. Amendment No. 263 clarifies which clause is referred to in subsection (1)(b). There is nothing further to say about it.

Amendment agreed to.

Clause 44, as amended, ordered to stand part of the Bill.

Clause 45

Questions to be decided on

references under section 43

Question proposed, That the clause stand part of the Bill.

Miss Johnson: I beg to move amendment No. 179, in page 32, line 29, leave out '(5)' and insert '(6)'.

I can certainly address this amendment, which corrects a cross-referencing error. Our intention is to ensure that the Competition Commission includes in its report decisions on the appropriate remedies for any substantial lessening of competition that occurs. I urge the Committee to support the amendment.

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Amendment agreed to.

Amendment made: No. 180, in page 32, line 48, after '(8)' insert—

    'in a case where it has decided by virtue of subsection (2)(a) or (5)(a) that there is or will be a substantial lessening of competition,'.—[Miss Melanie Johnson.]

Clause 45, as amended, ordered to stand part of the Bill.

Clauses 46 to 50 ordered to stand part of the Bill.

Clause 51

Restrictions on action where public

interest considerations not finalised

Question proposed, That the clause stand part of the Bill.

Mr. Lansley: You would not think it good, Mr. Conway, if I were to repeat the argument that I advanced in detail on clause 40. However, the Under-Secretary, my hon. Friend the Member for Eastbourne and I have pursued that argument for some time.

The 24-week period in the clause need not be so long and there would be much merit in making it shorter. The danger of providing for such a period is that it happens to coincide with the length of time allowed to the Competition Commission for its investigation. As the Under-Secretary says, it is a long stop. Having issued an intervention notice, the Secretary of State can consider how the order is to be made through Parliament and consult on it, almost until the very day on which the Competition Commission has to complete its investigation. If the Secretary of State backs out and the order is not finalised, the reference might fall.

It is inherently undesirable for the Secretary of State to use all the time available under that limit. The idea that action should be taken ''as soon as practicable'', found in clause 40(7), should also be applied under this clause, and the long stop should be a lesser period of time. The question is how long. I have not tabled an amendment, so I shall suggest something for the Under-Secretary to think about before Report.

Given that 12 weeks is the usual time allowed for Government consultation, and given that the Secretary of State must, at the time of the intervention notice, have a substantive idea of the grounds on which an order would be made, it seems reasonable that the period should be 12 weeks—or, at the most 16 weeks, if one adds 28 days for the laying of an order. If the Under-Secretary were to consider that, I should be satisfied.

6.15 pm

Miss Johnson: I shall give further consideration to that. I do not believe that our desires and the hon. Gentleman's are very different in this regard—should those things occur, they should be dealt with as expeditiously as possible. I would still need to consider whether a reduction in the time frame, and importing the same constraints, can be lived with, given the need to meet the parliamentary and other time frames that I mentioned a few moments ago. I shall reflect on it, but

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I make no promises about the outcome. I shall simply bear in mind what the hon. Gentleman has said.

Question put and agreed to.

Clause 51 ordered to stand part of the Bill.

Clauses 52 to 54 ordered to stand part of the Bill.

Clause 55

Duties of OFT and Commission

to inform Secretary of State

Question proposed, That the clause stand part of the Bill.

Mr. Djanogly: Clause 55 provides that the OFT and the commission should inform the Secretary of State if the so-called ''specified'' considerations apply, in which case subsection (2) comes into play and the Secretary of State becomes responsible for making decisions. That being so, it cannot be right, under subsection (1), that the OFT should decide whether any such consideration is immaterial. Surely, the decision should be made by the Secretary of State. If not, the Secretary of State should be able to review the OFT's decision. Under clause 55, the OFT is effectively being given the right to decide whether considerations are material. However, in the circumstances dealt with by the clause, that seems inappropriate.

Miss Johnson: I want to ensure that the hon. Gentleman is aware that we want to be certain that representations are seen by the Secretary of State when relevant. The OFT will alert the Secretary of State to representations that a case that it is considering raises a specified public interest consideration, but will not if the representation appears immaterial. That is important because vexatious representations are possible. The OFT and the Competition Commission will alert the Secretary of State to any calls for new public interest considerations, and they will not be case specific. I hope that I have answered the hon. Gentleman.

Mr. Djanogly: That does not answer my point. Clause 56 deals with ''specified considerations'' such as national security. In such situations, how can it be right that the OFT should be able to decide whether something is material? Surely, when national security is involved, the Secretary of State should have the right to decide whether something is material. She will not know, because she will not necessarily have been told about it if it is deemed immaterial.

Miss Johnson: The discretion is not to alert the Secretary of State to representations. As I said, that is sensible flexibility for the OFT when it believes that the Secretary of State would not want to consider a matter. It is important that we do not build in features that can be abused by those who simply seek to clog up the regime. That would be in no one's interests.

Mr. Djanogly: How would the Secretary of State know whether he or she would not be interested in such a matter?

Miss Johnson: It is for the OFT to judge, as is the case for many other issues, when it believes that the Secretary of State should not want to consider a

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matter further. Representations on public interest matters can be made to the Department of Trade and Industry, as is likely to take place in practice.

Mr. Mark Field: Will the hon. Lady give us guidance on where in legislation a similar clause applies—effectively letting a public body such as the OFT take discretion out of the hands of a Minister? It seems a peculiar state of affairs for the OFT to second-guess what a Minister might think is material, yet that Minister can in no way make a decision on the subject because he is unaware of the facts that might give rise to it. I assume that the clause has been taken from some other Act that refers to the interaction of a public body with a Ministry. If that is not the case, I would be intrigued to know how such a clause has come out of the ether.

Miss Johnson: Opposition Members are making rather heavy weather of the provision. The DTI and the Secretary of State are likely to be made aware of significant public interest matters. In those circumstances, if the matters are genuine rather than specious, it is unlikely that the OFT would do anything other than assume that Ministers would be interested in how those matters were pursued. We are not removing the discretion of Ministers, but the representations that they receive will be filtered. As I am sure Opposition Members are aware, some such representations may be made out to be material when they are not. People will argue that something is material when it is not if they think that it will get them through a different loop in the system. That is the only point at issue.

Mr. Field: Do we not have to take great care, particularly in relation to issues of national security? Perhaps we are dancing on the head of a pin, but the great concern among Opposition Members is that the provision will be used by a Minister to justify events post facto. A Minister or a Government could easily use it as an excuse to suggest that officials decided that no material consideration was needed, so the matter never reached the Minister's desk. Then the Ministry would have ignored something that could, after the events had all come to pass, be justified in the longer term as a glaring issue of national security. The Opposition are concerned that a Government could use the provision as a charter to avoid taking responsibility.

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