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OFT to hold meeting in Stornoway discussing fuel investigation

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The Office of Fair Trading will hold a meeting in Stornoway as part of a consultation process which could draw a line under its year long investigation.

Last week the OFT revealed its intention to accept commitments offered by Certas Energy, which previously traded road fuel in the Western Isles under the name Scottish Fuels.

If accepted the OFT will not take a final decision on if competition law was infringed by the company as this would require further investigative steps according to the watch dog.

Instead Certas Energy would end long-term exclusive contractual ties with local filling stations, extend access to the Stornoway Fuel depot to allow competition and open up the Loch Carnan terminal to competitors for a period of five years.

In a letter to Gazette (which can be seen in full on page 20 of the Stornoway Gazette, out now) James MacBeth, Project Director at the OFT, explained: “Our investigation into the issue has led us to delve deeply into the current arrangements for fuel supply on the Western Isles. This sort of scrutiny - although uncomfortable - does often lead to suppliers considering afresh their business practices.”

This was not the first set of formal commitments offered by Certas Energy. In December 2013 the OFT rejected another offer from the company, however when asked by the Gazette the OFT declined to detail what that offer was.

In regards to rebates, which were also a focus of the investigation, and the “any other payments” that may have been made to filling station, the OFT have stated there was, based on the evidence, no competition concerns. Asked what form the ‘any other payments’ came in the OFT spokesperson said: “We can’t discuss anything else for confidentiality grounds, but it’s simply the case that we do not have competition concerns regarding them.”

The public meeting, which will be held on 8th April at 6pm at the Council Chamber, Stornoway, forms part of the OFT’s consultation process which will continue until April 17th.

Asked if anyone from Certas will be attending the meeting a spokesperson for the company said: “We have already approached the OFT with the offer to attend and represent ourselves, the OFT have stated that they would prefer that Certas Energy didn’t attend.”

The OFT spokesperson insisted, however that: “There are no restrictions on who can attend the OFT’s open public meeting in Stornoway.”

Commenting on the progress of the investigation to date a Certas spokesperson said: “Certas Energy has worked closely with the OFT to agree certain measures that reflect specific features of the Western Isles and welcomes further competition in the Western Isles. Current Western Isles contractual arrangements are similar to those Certas Energy has in the rest of the UK, and are commonplace in the industry. However, these new measures will ensure that every Western Isles retailer currently supplied by Certas Energy will be given a range of contractual options to engage with the company in the future.”

Certas Energy also plans to hold its own meetings in the islands to discuss issues that have been raised.

 

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