Fuel: Marine and Aviation Market: Request to Jersey Competition Regulatory Authority (JCRA) to Examine and Report

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A decision made 21 March 2014:

Decision Reference: MD-E-2014-0019
Decision Summary Title :	Request to the JCRA under Article 6(4) of the Competition Regulatory Authority (Jersey) Law 2001 to produce a report examining the marine & aviation fuel markets in Jersey		Date of Decision Summary:	13th March 2014
Decision Summary Author:	Strategic Development Officer		Decision Summary: Public or Exempt? (State clauses from Code of Practice booklet)	Public
Type of Report: Oral or Written?	Written		Person Giving Oral Report:	n/a
Written Report Title :	Request by the Minister for Economic Development for the (JCRA) to produce a report examining the supply of marine & aviation fuel in Jersey under the authority of Article 6(4) of the Competition Regulatory Authority (Jersey) Law 2001		Date of Written Report:	13th March 2014
Written Report Author:	Strategic Development Officer		Written Report : Public or Exempt? (State clauses from Code of Practice booklet)	Public
Subject: Article 6(4) request for the JCRA to examine and report on the market for marine & aviation fuel in Jersey.
Decision(s): The Minister approves the attached Article 6(4) request to the JCRA.
Reason(s) for Decision: The JCRA will undertake a review of the level of pricing of aviation & marine fuel in Jersey and in comparable jurisdictions to examine the reasons behind any variation in price, to assess the extent to which any such differences can be justified and to examine barriers to entry and to consider means to enhance competition. In order to undertake a market study, the JCRA requires access to all relevant information. This request provides the JCRA with powers under Article 26(2) of the Competition (Jersey) Law 2005
Resource Implications: The JCRA will meet the cost of the review from its own resources, so this decision will result in no resource implications. In the event that specific consultancy assistance is required, support for this specific cost may be sought by the JCRA. In this event, funding will be discussed.
Action required: The attached request to be sent to the JCRA for its consideration.
Signature: Senator A.J.H.Maclean		Position: Minister
Date Signed:		Date of Decision (If different from Date Signed):

Fuel: Marine and Aviation Market: Request Jersey Competition Regulatory Authority (JCRA) to Examine and Report

7th March 2014

Senator Maclean

Minister

Economic Development Department

Cyril Le Marquand House
The Parade
St. Helier
Jersey
JE4 8UL

Dear Andrew

Request to examine the aviation fuel and marine fuel markets in Jersey under the authority of Article 6(4) of the Competition Regulatory Authority (Jersey) Law 2001

In light of the current concern surrounding the supply of aviation fuel and marine fuel in Jersey, I have decided to request the Jersey Competition Regulatory Authority (JCRA) under Article 6(4) of the Competition Regulatory Authority (Jersey) Law 2001 to undertake a study of the supply of aviation fuel and marine fuel in Jersey, in the terms listed below.

I understand that Deputy Kevin Stewart, Minister for Commerce and Employment in Guernsey, has made a request in similar terms of the Guernsey Competition and Regulatory Authority (GCRA).

I have noted that CICRA (the Channel Islands Competition and Regulatory Authorities) proposes to investigate the aviation fuel and marine fuel markets in order to satisfy concerns raised by a range of stakeholders, including retail customers (both large and small), retailers and potential market entrants. Moreover, given that fuel supplies are critical to essential transport links in both jurisdictions and also given the interdependence of the islands’ markets, you have indicated that both of these investigations should be conducted on a pan-Channel Islands basis and that two separate reports may be produced.

Some features of the aviation fuel and marine fuel markets are likely to be very similar, and so the Economic Development Department supports a pan-Channel Islands approach, particularly in light of the potential for cost savings.

Terms of reference

1) To identify the extent of the differences in the prices for a) aviation fuel and b) marine fuel at the importation, wholesale and retail levels between Jersey, Guernsey, the Isle of Man, and any other locations that the JCRA considers relevant, net of taxes and duties; and

2) To assess the extent to which any such differences can be justified by reference to differences in cost; and

3) To consider whether measures could be taken to increase the extent of competition in the supply of aviation fuel and marine fuel in Jersey, or to otherwise improve outcomes for consumers, and to make any recommendations for changes or improvements that might be considered.

As this is a request under Article 6(4) of the Competition Regulatory Authority (Jersey) Law 2001, it provides the JCRA with powers under Article 26(2) of the Competition (Jersey) Law 2005 to require the provision of information relevant to this market study.

I understand that the JCRA will endeavour to complete both projects by the end of September 2014. The JCRA has discretion in deciding the level of detail that is published and in what form any such report or publication will be published, balancing issues of accountability, effectiveness and confidentiality.

We have agreed that it is intended that the JCRA will meet the cost of the review from its own resources. In the event that significant consultancy assistance is required, support for this specific cost may be sought by the JCRA from the Department. Expenditure which the JCRA may hope to reclaim from the Department must be approved by me before any commitments are made.

Yours sincerely

Senator Alan Maclean

Economic Development Minister