OFT launch consultation on improving competition in fuel supply to Isles

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The OFT has today (Tuesday) launched a consultation on proposals to improve competition in the supply of petrol and diesel to filling stations in the Western Isles.

The OFT has been investigating a possible infringement of competition law in the islands, in particular the contractual arrangements for the wholesale supply of road fuels between Certas Energy UK Limited (‘Certas’, formerly known as GB Oils Limited) and certain filling stations on the islands.

The OFT’s consultation is on commitments proposed by Certas which are designed to address the OFT’s competition concerns.

The proposed commitments will bring an end to contracts which require many filling stations on the islands to buy fuels exclusively from Certas for five years. The commitments will also open up access to Certas’ marine terminal in Loch Carnan, in South Uist, to potential competitors to Certas for a period of five years. At the same time, the commitments will extend access to Certas’ marine terminal in Stornoway, in the Isle of Lewis, to potential competitors to Certas until the end of 2017.

Ann Pope, Senior Director in the OFT’s Services, Infrastructure and Public Markets group, said: “These proposed commitments offer a real opportunity for alternative fuel suppliers to enter the market which should ultimately help make fuel prices more competitive to the benefit of people and businesses in the islands. The commitments address the OFT’s competition concerns and at the same time send a clear message that suppliers need to comply with competition law even in smaller local markets.

“We would now like to hear the views of the community and all other interested parties before we make a decision on whether to accept the commitments.”