Senator JOYCE—I placed some questions on notice to you last year that were not answered. I will go through them again because we have not received a reply from you. Does the ACCC need phone tapping powers? These are questions that I placed on notice last year in the May 2007 estimates.

Talk
CHAIR—That is an important point. Do any of the other senators have issues on—

Talk
Senator JOYCE—If you want me to go in another direction I can go into another area including the introduction. But I want to cover those areas because—

Talk
CHAIR—I understand completely.

Talk
Senator JOYCE—It is out of respect for the Senate that questions on notice be answered. If they are not answered—

Talk
CHAIR—I agree.

Talk
Senator Sherry—I agree. It is a serious reflection on the previous minister and the previous government that we have been waiting so long. Has the secretariat been able to ascertain where exactly the questions are, the answers?

Talk
Senator JOYCE—I have asked the secretariat and they have just said that they never came back.

Talk
Mr Samuel—This is an important issue. It is not only a reflection on—

Talk
CHAIR—I do want to discuss this but I want to finish off on the grocery prices issue.

Talk
Senator JOYCE—We will go on to the next one.

Talk
Senator Sherry—In terms of Mr Samuel’s position, the ACCC may have supplied the answers to the minister or ministers. He might like the opportunity to indicate.

Talk
Mr Cassidy—The situation is that we have answered all questions that we took on notice last time we were before this committee. The answers were provided before the election. As I understand it, the newly elected government is now considering those answers and whether they will be provided in the form they are currently in.

Talk
Senator JOYCE—As long as they are provided.

Talk
Mr Cassidy—I would like to be clear that we provided answers to all questions that we took on notice last time we were here. When we get to it, I think we are quite happy to deal with that.

Talk
CHAIR—Can you tell the committee the date that they were provided?

Talk
Mr Cassidy—I cannot give you a precise date. But they were provided by the time that they were required following the last estimates committee meeting.

Talk
Senator JOYCE—Turning to some other issues, you have said that United Petroleum purchased the Hastings terminal. Does it have the capacity to refine fuel there?

Talk
Mr Samuel—No. It is purely a receiving terminal. It has the capacity to receive refined petrol.

Talk
Senator JOYCE—In its capacity to receive fuel where will it be receiving it from and will it be curtailed anywhere it can gain fuel from because of the sulphur content rules in Australia?

Talk
Mr Samuel—I should indicate at present—don’t hang me on the number—20 per cent or more of our refined petrol is in fact imported into Australia. It is imported into various terminals, including in Melbourne, Sydney, Queensland and in WA in particular. It is imported and it satisfies the Australian environmental standards. There is no shortage of fuel being produced in South East Asia and indeed elsewhere, over in the Middle East, that will satisfy the Australian Standards. The difficulty is that the terminal capacity to receive refined fuel is largely controlled by the four major oil companies. The Hastings terminal which now has been acquired by United Petroleum, is fully capable of receiving imported fuel that will satisfy our Australian Standards.

Talk
Senator JOYCE—Will it be able to receive it at a competitive price and capacity to get it out to the market?

Talk
Mr Samuel—That is not a matter for us, that is a matter for United Petroleum. I would simply observe that during the course of the inquiry it became evident that there are refineries that either exist or are opening in Asia, particularly a very big refinery that will be opening in India, that produces vast quantities of refined petrol that will satisfy our standards. If we look at that and a source in Korea, Indonesia and elsewhere in South East Asia, there is ample supply of fuel that will satisfy our standards that is not being sourced necessarily from the refineries that are controlled by associates of the four major oil companies.

Talk
Senator JOYCE—Do you have the capacity under the Trade Practices Act to prevent the other majors from undercutting their price when that fuel arrives so as to make it unviable for United Petroleum to retail their product?

Talk
Mr Samuel—If there was a deliberate act of predatory pricing that fell foul of section 46 of the act, which of course has been amended to enhance our ability to deal with predatory pricing issues, clearly we have power in that context.

Talk
Senator JOYCE—Under that part of the act, are you pursuing any cases under the Birdsville amendments at the moment?

Talk
Mr Samuel—As you know, it is not our practice to comment on matters that we might be investigating or dealing with at the investigatory stage at any point in time. There are no matters currently before the courts in relation to the Birdsville amendments. I should mention by the way that in terms of predatory pricing the Birdsville amendments, as they are called, are but only one area of section 46. As you are aware, section 46 was also amended to make it easier for us to deal with predatory pricing under the more general provisions of section 46. They need to be also kept in mind. We do not comment upon matters that we might be investigating.

Talk
Senator JOYCE—On two occasions recently you have publicly indicated that there was a divergence between the Singapore price and where you expected the Australian petrol prices to be. On both occasions you indicated that you would seek an explanation from the oil companies. Can you tell us how the oil companies have explained the differences and do you accept the explanations?

Talk
Mr Samuel—The differences were subject to two separate explanations because there were two big divergences. By way of very quick background, in the second week of December we noticed a very significant divergence in terms of what had happened on previous occasions between the Singapore Mogas 95 unleaded price and the average Australian retail price across the five major metropolitan cities of Australia, and we lag that by about a week. The divergence that occurred was of the order of about 7c per litre, which is far more significant than had occurred on previous occasions that we had been monitoring these divergences. We sought an explanation and while one of the oil companies indicated that there had been a problem with its refinery in Sydney, the Kurnell refinery that was operated by Caltex, the explanations from the other oil majors did not seem to be in any way related to that. They simply said it was part of the way that the market was operating. The divergence subsided or diminished somewhat through the latter part of December and into early January and then in the latter part of January, about the third week of January, it suddenly shot out again to near record levels in terms of