Overview

This bill aims to equalize road fuel prices between rural and urban areas in the UK. It empowers the Competition and Markets Authority (CMA) to investigate and penalize companies charging significantly higher prices in rural locations compared to urban areas for the same fuel.

Description

The Road Fuel Pricing (Equalisation) Bill mandates that fuel retailers provide information to the CMA if evidence suggests price discrepancies between rural and urban areas within a wholesaler's region. The CMA will then investigate if this constitutes an abuse of a dominant position under the Competition Act 1998, or if misleading information was provided. If an abuse is found, the CMA must publish a notice requiring the company to equalize prices nationally for 30 days. This single price will be the lowest national retail price charged by that company on the day the fine was imposed, with potential adjustments for wholesale price fluctuations. Failure to comply results in further fines, calculated based on the average charged price and an “acceptable price” for the region. The CMA will review the fine system every three years. The bill defines key terms like "urban area," "rural area," and "wholesaler's region" through regulations made by the Secretary of State.

Government Spending

The bill does not directly specify government spending increases. However, there may be administrative costs associated with the CMA's increased responsibilities in investigating price discrepancies, and resources will be required to review the penalty system every three years. The actual financial impact will likely depend on the number and scale of investigations undertaken.

Groups Affected

• Fuel Retailers: Potentially face fines for price discrepancies and administrative burdens from providing information to the CMA.
• Consumers in Rural Areas: May benefit from lower fuel prices if the bill leads to price equalization.
• Consumers in Urban Areas: May see a slight increase in fuel prices if the lowest national price becomes the benchmark for all areas.
• The Competition and Markets Authority (CMA): Takes on a greater enforcement role and will be required to investigate and resolve fuel price discrepancies.
• The Secretary of State: Responsible for defining key terms and reviewing the effectiveness of the penalty system.

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