OfReg rewrites rules to satisfy stakeholders

| 07/03/2019 | 13 Comments

Cayman News Service

(CNS): The body established to regulate Cayman’s utilities sector and ensure fair competitive practices has redrafted rules on the penalties for any breaches of anti-competitive practices law. OfReg said this was in response to concerns by stakeholders, as the regulator released the new draft rules for final consultation this month. A release stated that when these rules are implemented, they will “deter anti-competitive practices in the utilities, fuel and ICT sectors, and protect consumers from high prices, poor quality and a lack of innovation”.

OfReg said it had set out the six stages that it will follow in determining penalties for breaches of the law and had provided “the clarity on the methodology that was requested by licensees following the initial consultation”, which took place last year.

Commenting on the redrafted rules, Deputy CEO and Executive Director of ICT Alee Fa’amoe said the regulator had listened to calls for greater clarity on how it would calculate penalties for breaches  of the law.

“Penalties are an essential tool in deterring anti-competitive conduct in the sectors regulated by the Office. Consumers benefit from fair competition in markets which leads to lower prices, improved quality and investment in innovation as licensees compete for the consumers’ business,” he said. “The law also protects business which suffer the consequences of attempts by their competitors to distort, restrict or prevent competition.”

Explaining the approach in determining penalties, officials said that in the first instance OfReg will consider the severity of the breach and the likelihood that the breach would cause harm to competition and to consumers.

Adjustments will then be made in the subsequent five stages to account for relevant factors, such as the duration of the breach, any aggravating or mitigating factors, deterrence, proportionality, and to account for any leniency agreements that a party may have entered into with the office.

While the maximum penalty than can be imposed for breach of anti-competitive practices law is set at $3 million, the rules indicate it would be extremely unlikely that any such fine would ever be imposed and there is plenty of room for utility operators to avoid paying anything.

Officials said, however, that the legislation and penalties regime ensure that the public could have confidence that there is fair competition in the sectors under OfReg’s regulatory remit.

OfReg stated that anti-competitive practices include abuse of dominant market position, price-fixing, limiting the production of a good to artificially manipulate price, bid rigging and colluding to divide markets.

These practices are harmful to consumers who pay a higher price for goods and services that are of lower quality. Anti-competitive practices also inhibit innovation, which is vital to the development of efficiency and quality, officials stated in the release.

See the public consultation document in the CNS Library

Respondents have until Wednesday 13 March 2019 to send their submissions by email, post or courier to OfReg. Further details are contained in the consultation document.

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Category: Business, Politics, Private Sector Oversight

Comments (13)

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  1. Anonymous says:

    Stop whining and do something about it. Get solar panels and buy an electric car. The. You can drive right past the gas stations.

  2. Anonymous says:

    asked before….how many ofreg members are masons?

  3. Anonymous says:

    I’m surprised no one has even mentioned the rip off telecommunications companies that promises you gold yet not even coal you get. Half the time the internet is down but you still pay the same monthly price. You cannot even speak to someone locally and what happened to the fibre promised some years ago? Let’s face it, OFReg and ICT have no balls and as long as the big corporate boys are profitable and you get paid, the consumers in Cayman will always be at the bottom of the food chain.

  4. Anonymous says:

    Aren’t OfReg supposed to police the stakeholder merchants and cartels on behalf of the public, not cave to go easier in the opposite direction? Has OfReg ever fined anyone?!?

  5. Anonymous says:

    In Jamaica which is a stone throw away they are paying US $2.50 how are we paying US $6.00? Just some food for thought as to how we are being extorted by gas stations and supermarkets alike. Not to mention some bars that are charging prices that rival South Beach Miami. Is this what government meant when they said they were going to cut living cost. Just imagine when they build that 50 story tower they are planning for the quote “Ultra Wealthy”.

    • Anonymous says:

      I don’t know how yu arrived at the US$2.50 figure, but the gas stations in Jamaica sell gasoline in J$ per litre.
      So you would have to convert J$ to US$ and then to CI$ for comparison as well as convert litres to imperial gallons, and I suspect all those calculations are beyond your abilities.

    • Anonymous says:

      Actually, right now Jamaicans are paying the equivalent of about US$4.70 per US gallon (J$158.00 per liter) which converts to approximately CI$4.70 per imperial gallon. There are convenient sites on line that will do the math. But hey, don’t let reality get in the way.

  6. Anonymous says:

    Gas is over 4 bucks, insane!

    • Anonymous says:

      So car pool or ride a bus. Less expensive. Less wear & tear on your vehicle.

      • Anonymous says:

        Yes, let me go out of my way so the petrol mafia can keep up price gouging. You obviously aren’t a critical thinker.

        I can afford the cost but I shouldn’t have to pay it because of complacent people like you not standing up to them in the first place.

  7. Anonymous says:

    Yawn!

    • Anonymous says:

      They will do nothing to bring down the high price of gas, $ 5.14 in the Brac, that dept. Is waste of tax payers money

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