No. 228
MINISTRY FOR SOCIAL DIALOGUE, CONSUMER AFFAIRS AND CIVIL LIBERTIES
Competition Act (Cap. 379)
IN accordance with article 30 (3) of the Competition Act (Cap. 379), the Minister for Social Dialogue, Consumer Affairs and Civil Liberties is making the following declaration with respect to a service of general economic interest:
Whereas:
(1) Liquefied Petroleum Gas (LPG) retailed through portable cylinders constitutes an important and integral source of energy to end consumers, particularly with regards to heating needs;
(2) There is no availability of natural gas on the market as an alternative source for energy consumption by end consumers;
(3) End consumers have no access to a distribution grid as available predominantly within other Member States forming part of the European Union, and thus depend primarily and principally on door-to-door distribution of LPG portable cylinders;
(4) Malta has an above average energy poverty when compared to the average reported in the European Union, particularly with regards heating needs where the number of households unable to keep their home adequately warm has doubled since 2005 amounting to 21.7% of the whole population in 2011 according to the Survey on Income and Living Conditions (SILC) published by the National Statistics Office (NSO) in 2012.
(5) Energy poverty with regards to heating needs is more pronounced within the more vulnerable sections of the Maltese population, particularly but not exclusively, low income earners, the elderly and single parent households;
(6)The Government of Malta considers, in light of the above amongst other reasons, that the secured access by end consumers across the whole territory of the Maltese Islands to LPG portable cylinders to be in the interests of the public and public security;
(7) It is in the interest of the end consumer and the market at large that there is a high degree of competition and effective liberalisation in the importation, storage, supply, bulk and wholesale retail of LPG. It is likewise paramount that end consumers enjoy the right to be provided with a door-to-door distribution service irrespective of their geographical location at reasonable, easily and clearly comparable, transparent and non-discriminatory prices;
(8) It is therefore desirable that the distribution to end consumers of LPG portable cylinders be subject to a clearly defined public service obligation, primarily but not limited to: (a) the distribution of LPG portable cylinders across the whole territory of the Maltese Islands ensuring all end customers universal access, where distribution costs are non-discriminatory, (b) the attainment of efficiencies including better customer-care and services, and (c) guaranteeing end consumer choice of all suppliers operating in the market;
(9) It is recognised, on the basis of appropriate economic studies, that in view of the limited size and nature of the relative local market such outcomes of an overall public good would not be supplied (or would be supplied under different conditions in terms of objective quality, safety, affordability, equal treatment or universal access) by the market without public intervention;
(10) Government and the relevant authority has held the necessary and appropriate consultation with all stakeholders and the general public;
(11) The Government of Malta acknowledges the continued need for the timely, efficient and consistent provision of service relating to the organisation, management and operation of transportation and distribution of LPG cylinders across the Maltese Islands is in the best interests and well-being of the residents of the Maltese Islands as well as for the overall sustainability and competitiveness of Malta and its economy;
(12) It is therefore desirable that the retail and door-to-door distribution to end consumers of LPG portable cylinders be declared a service of general economic interest in terms of Article 106(2) of the Treaty on the Functioning of the European Union and Article 30 of the Competition Act;
(13) The declaration as a service of general economic interest of the retail and door-to-door distribution to end consumers of LPG portable cylinders is also necessary in order for the Republic of Malta to protect its social and economic cohesion;
(14) Any undertaking or undertakings so entrusted with the abovementioned public service obligation must be allowed to perform under economically acceptable conditions, ensuring that such undertakings will cover the costs for the fulfilment of the public service so imposed plus the retention of a reasonable profit determined on the basis of a typically, well-run and adequately equipped undertaking, thus ensuring that such service is provided at the least cost to the community;
(15) To ensure that the fulfilment of this public service obligation is attained in a manner that is least restrictive to competition, there shall be no restriction of authorisations for the distribution and retail LPG portable cylinders, authorisation for which shall be open to any person so authorized provided that any such person or authorized provider in whose favour an authorization is granted satisfied any conditions specified within the authorizations and any applicable legislation. To this extent, end customers shall have further access to more competitive supplies;
Now therefore by virtue of this declaration, in terms of Article 30 (3) of the Competition Act, the Minister for Social Dialogue, Consumer Affairs and Civil Liberties who is responsible for competition matters, on behalf of the Government of Malta, declares the door-to-door transportation and distribution of Liquefied Petroleum Gas cylinders to end consumers to be a service of general economic interest.
Declares further that such service of general economic interest has been entrusted to all duly authorized LPG portable cylinders distributors by the Ministry for Energy and Health (or the Malta Resources Authority), whose authorization is limited solely to such distribution at time of entrustment, which distributors are in the best position to provide those services effectively, efficiently, at the least cost to the community and in compliance with all the targets and regulations relating to the transportation and distribution of LPG cylinders. The distributors so entrusted being thirty one in number are as follows:
1. Emanuel Grech, residing at ‘Randle, Triq it-Tut, Zabbar, holder of Identity Card number 3961(M);
2. RenéGrech, residing at 84, Triq Sammat, Paola, holder of Identity Card number 482779(M);
3. Kevin Magro, residing at ‘Britchel’, Triq il-Kbira, Ħal Qormi, holder of Identity Card number 328176(M);
4. John Marmara, residing at 69, ‘Madonnina’, Triq Fieres, Tarxien, holder of Identity Card number 589462(M);
5. John Borg, residing at ‘Santa Marija, Triq Karmnu Ciantar, Mqabba, holder of Identity Card number 137267(M);
6. Kenneth Mifsud, residing at 19, ‘Opium’, Triq Mikiel Busuttil, Żejtun, holder of Identity Card number 295963(M);
7. Carmel Meli, residing at 74, ‘Caritas Dei’, Triq iż-Żejtun, Tarxien, holder of Identity Card number 350356(M);
8. Emanuel Bugeja, residing at ‘Carmen House’, Triq Dun Manwel Zammit, Siggiewi, holder of Identity Card number 147759(M);
9. Paul Spagnol, residing at ‘Tal-Karmnu’, Plot 2, Triq l-Isqof Ferdinand Mattei, Żejtun, holder of Identity Card number 122063(M);
10. Francois Cassar, residing at ‘Coral Court’, Flat 5, Triq is-Sdieri, Marsaskala, holder of Identity Card number 423681(M);
11. David Fenech, residing at 42, ‘Cecilia’, Triq Ġanni Vassallo, Ħal Luqa, holder of Identity Card number 490863(M);
12. Willie Mifsud, residing at ‘Sunflower House’, Triq L. Casolani, Ta’Paris, Birkirkara, holder of Identity Card number 360457(M);
13. Lennie Caruana, residing at 6, ‘Clark Mansions’Triq il-Maħsel, Marsascala, holder of Identity Card number 517185(M);
14. Aronne Camilleri, residing at ‘6, St Helen, Triq Brighella, Fleur De Lys, Birkirara, holder of Identity Card number 271668(M);
15. Carmel Cutajar, residing at ‘Corner House’, Triq Anici, Qormi, holder of Identity Card number 489655(M);
16. Raymond Sarcia, residing at ‘Orchidea’, Triq Ħ’Attard, Ħal Qormi, holder of Identity Card number 620061(M);
17. Albert Cumbo, residing at 13, Triq San Piju X, Żejtun, holder of Identity Card number 379065(M);
18. Keith Desira, residing at ‘Ciapirosca’, Triq il-Hall, Żejtun, holder of Identity Card number 8381(M);
19. Mariella Said Kasem, residing at 13, ‘Deum Amo’, Triq Mater Boni Consigli, Żejtun, holder of Identity Card number 204279(M);
20. Anthony Debono, residing at Flat 8, Block E, Triq ix-Xemxija, Marsa, holder of Identity Card number 73068(M);
21. Michael Camilleri, residing at ‘St Catherine House’, Misraħta’Pezzuto, Zejtun, holder of Identity Card number 568165(M);
22. Simon Buhagiar, residing at 12, Ħas-Sajjied, Żabbar, holder of Identity Card number 252375(M);
23. Silvio Debono, residing at ‘Silmar House’, Triq IndrìMicallef, Ħal Luqa, holder of Identity Card number 204171(M);
24. Mario Polidano, residing at ‘David’, Triq Ġanni Vassallo, Ħal Luqa, holder of Identity Card number 224255(M);
25. Benny Desira, residing at ‘Mystic Rose, 213, Triq Toni Zahra, Żejtun, holder of Identity Card number 419479(M);
26. Fernando Cremona, residing at 29, ‘Our Dream’, Triq Dun Ġwann Farrugia, Żejtun, holder of Identity Card number 221679(M);
27. Mario Sant, residing at 108, ‘Windways’, Triq il-Gargir, Mellieħa, holder of Identity Card number 17367(M);
28. George Debono, residing at 46, Triq l-Iżbandola, Ħal Qormi, holder of Identity Card number 418362(M);
29. Peter Borg, residing at ‘Violet’, Flat 2, Triq Mikiel Abela, Birzebbuġa, holder of Identity Card number 424861(M);
30. Brian Magro, residing at 61, Triq it-Torri, Ix-Xewkija, Gozo, holder of Identity Card number 26179(G);
31. Carmel Formosa, residing at ‘Lily of the Valley’, Triq Wied Merill, San Lawrenz, Gozo, holder of Identity Card number 36255(G).
Declares further that such entrustment by the Ministry for Energy and Health is subject to, amongst others, the following conditions:
(a) To organise, manage and operate on a weekly basis a universal door-to-door distribution of LPG cylinders throughout the entire territory of the Maltese Islands by means of an appropriate distribution vehicle;
(b) To ensure that final consumers within said territory enjoy choice of product through the operation of a multi-flag system;
(c) To ensure that the price of the service to be borne by final consumers throughout the entire territory is uniform and non-discriminatory;
(d) To ensure a high quality of service, which is to include but not limited to the following:
an appropriate price display on vehicles and selling points;
provision of receipt for sales effected;
provide to final customers schedule of deliveries;
door-to-door deliveries to be made weekly between 7.00 a.m. to 5.00 p.m. from Monday to Friday and between 7.00 a.m. and noon on Saturday;
to assist final consumers where possible with all matters relating to the proper use and connection of LPG gas cylinders free of charge;
delivery persons to be properly dressed and well mannered;
delivery of LPG cylinders not to cause any nuisance to the general public;
delivery vehicles to be maintained in good working order and in good condition;
to provide/set up a call centre for deliveries within six (6) months of signing of this Agreement, and maintain such service in operation thereafter;
ensure that deliveries are made within a reasonable time.
(e) To ensure that the delivery vehicles used are of the highest of standards;
(f) To observe to the highest degree any obligations arising out of any appropriate authorisation issued by the Malta Resources Authority in terms of Liquefied Petroleum Gas Market Regulations (S.L. 423.31) or any other relevant legislation;
(g) To observe to the highest degree any directions or obligations imposed by any supplier regarding the sale, marketing, and promotion of the supplier’s product, insofar as such directions or obligations are compatible with the present agreement or any relevant legislation;
(h) To observe to the highest degree any other directives issued from time to time by Government of Malta or the Malta Resources Authority.
The period of entrustment is of fifteen (15) years effective as from 20th May, 2014. In order to carry out the entrustment relating to the provision of the Public Services in terms of said entrustment, the Government of Malta undertakes, subject to the presentation of an audited declaration to that effect, to make advances in favour of the entrusted distributors by way of compensation, which compensation however shall under no circumstance exceed the level of de minimis compensation as defined in the Commission Regulation (EU) No 360/2012 of 25th April, 2012 on the application of Articles 107 and 108 of the Treaty on the Functioning of the European Union to de mininis aid granted to undertakings providing services of general economic interest, or any other relevant Commission Regulation regulating de minimis aid which may be issued from time to time. Regular checks and audits shall be carried out in order to ensure that the distributors shall not receive compensation in excess of the determined amount and if at any time it transpires that the distributors will have been overcompensated by the Government of Malta, said distributors shall be liable to refund such overcompensation to Government at Government’s first demand.
17 Marzu 2015