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Legislative Assembly for the ACT: 1998 Week 8 Hansard (29 October) . . Page.. 2416 ..

MR HUMPHRIES (Acting Chief Minister, Attorney-General, Minister for Justice and Community Safety and Minister Assisting the Treasurer) (11.11): Mr Speaker, I present the Fair Trading (Petroleum Retail Marketing) (Repeal) Bill 1998, together with its explanatory memorandum.

Title read by Clerk.

MR HUMPHRIES: I move:

That this Bill be agreed to in principle.

The Fair Trading (Petroleum Retail Marketing) Act 1995 prevented multisite franchising of petrol operations and restricted the number of service stations that the oil majors could operate. This was an appropriate response at the time to head off attempts by the major oil companies to build anti-competitive mechanisms into the Canberra retail petrol industry. Franchisees and independent operators were being forced out of the market, and this Act sought to provide certainty and security of tenure for small service station operators.

The move was widely supported by petrol retailers and vehemently opposed by the major oil companies. The Act was the solution for the time; but times change, and the ACT petrol industry has changed dramatically since 1995. The advent of independent petrol retailing and the entry of Gull and Woolworths Plus into the local market have resulted in lower petrol prices. Also we tend not to see massive hikes in petrol prices to coincide with long weekends and school holidays. There are still fluctuations in prices; but, if people shop around, petrol prices across Canberra can be very competitive. In the past year, petrol prices in Canberra have declined, on average, by 4c a litre. Mr Speaker, petrol has dropped in price by 4c a litre since the advent of Gull into the Canberra market a little over a year ago.

At the same time, changes in the industry have put many single-site franchisees in an invidious position. They occupy marginal sites and cannot compete with Woolworths, Gull or better located sites. In addition, many of their leases are coming up for renewal in the next couple of years, and this Act now makes the exit of some franchisees from the industry more difficult.

In 1997, the Government announced that it would grant exemptions from the Act on a case-by-case basis. Two exemptions have now been granted - to BP and Mobil. The reasons for my granting exemptions were compelling and impacted directly on employment and business in the ACT.

Further, the Commonwealth has announced its intention to repeal the Petroleum Retail Marketing Franchise Act 1980 and the Petroleum Retail Marketing Sites Act 1980. These Acts underpin the operation of the ACT Fair Trading (Petroleum Retail Marketing) Act 1995. This, combined with the Commonwealth's moves to introduce terminal gate pricing, will increase competition and demand greater flexibility in the petrol retail market.

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