Mr John Whittingdale (Maldon & East Chelmsford, Conservative)

I beg to move amendment No.83, in

clause 80, page 76, line 21, leave out from 'must' to 'carry' and insert—

'at intervals not exceeding two years from the commencement of the previous analysis of the market concerned, or if, as a result of a change in market conditions, a communications provider notifies them in writing that it requires them to carry out such a review,'.

This amendment is small, but quite important none the less. Clause 80 deals with reviewing the services market in which a determination has been made that a particular operator has significant market power. Whether that market power exists will, clearly, depend heavily on the particular market that has been identified and studied.

Under the terms of the Bill, the review of that services market should take place at ''such intervals as'' Ofcom considers ''appropriate''. That seems to us to give Ofcom too much power, especially since, in this field, it is likely that technology will develop very quickly, as has been said many times during our debates. It is conceivable that a market might change very rapidly. Therefore, it would be helpful to include in the Bill, at the very least, a requirement that Ofcom should re-examine the market

£''at intervals not exceeding two years from the commencement of the previous analysis of the market concerned''.

Moreover, where an industry has changed very quickly and the particular player that Ofcom has decided has significant market power can see that the market has changed and that matters are now extremely different from when the review was originally conducted, it is only fair that that player can go to Ofcom and request, in writing, a further review of the services market. That would be the effect of the amendment. It would set down a specific maximum time that could elapse before a review had to be undertaken again, and give any company affected by that the ability to request a review in an even shorter period.

Mr Stephen Timms (Minister of State (e-Commerce & Competitiveness), Department of Trade and Industry; East Ham, Labour)

I agree that Ofcom needs to keep under review the significant market power determinations that it has made and the conditions that it has set as a result. Clause 80 provides for that. However, I would argue that the timing of those reviews ought to be in the hands of Ofcom and not set by the rather rigid mechanism that the hon. Gentleman proposes.

We have already agreed that the general duties of Ofcom should include a requirement for it to have regard to the principle that regulatory activity should be

£''transparent, accountable, proportionate, consistent and targeted only at cases in which action is needed''.

£That is in clause 3(3)(b). Clause 6(1) requires Ofcom to ensure that regulation does not involve

£''the imposition of burdens which are unnecessary; or . . . the maintenance of burdens which have become unnecessary''.

£There is no need for an additional requirement on Ofcom to review significant market power analyses and determinations as a result of market changes. If such changes rendered a review appropriate, Ofcom would already be required to act.

I would be loth to set in statute the two-year limit that the hon. Gentleman proposed. We do not know at the moment whether that is the correct frequency. It may well be far too often, and would therefore impose unnecessary work on Ofcom and those required to

provide information for the analyses that Ofcom would have to carry out. It would be better to rely on the obligations of Ofcom that are already agreed, rather than set what is, inevitably, a somewhat arbitrary time limit.

The provisions are simply the sensible next steps, moving on from the initial determinations of significant market power to reviews of the situation. Ofcom is required by the clause to carry out further analyses of the markets for the purposes of reviewing the determinations made on the basis of earlier market analyses and reviewing any SMP conditions set as a consequence. That is very much in keeping with the aim of keeping any regulatory burdens appropriate to what is needed in the market. I hope that on reflection the hon. Gentleman might feel that imposing a strict two-year limit would not be the best way for Ofcom to exercise its responsibilities.

Mr John Whittingdale (Maldon & East Chelmsford, Conservative)

I take the Minister's point about setting an arbitrary time scale. I particularly recognise his concern, which I share, that operators should not have to supply huge amounts of information every two years and take up a lot of time doing that when it is quite plain that nothing much has changed. I am slightly more disappointed that he does not recognise the need to give operators at least the power to request a review when something clearly has changed. I hope that his confidence that Ofcom will recognise that change without prompting from the industry is justified, but it is not an issue I particularly wish to press. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Question proposed,{**roman**} That the clause stand part of the Bill.

Mr Andrew Lansley (South Cambridgeshire, Conservative)

I did not want to speak to the amendment because the Government accepted what the scrutiny Committee said about the mandatory character of periodic market analyses. I will not dwell on the subject that we previously discussed relating to the withdrawal of obligations. However, it is perfectly clear, not least from what the Minister has just said, that clauses 80 and 81 relate to the review of market analyses, rather than to the original market analyses. Perhaps the Minister will get back to me if there is some reassurance he can give about the nature of the withdrawal of pre-existing obligations.

I have a question for the Minister. Clause 80(4) will revoke SMP conditions if a subsequent analysis discloses that there is no one with significant market power in relation to the market analysed. The clause and the market analysis relate not only to SMP conditions but, under the Community directives, to conditions under article 7 of the access directive and article 16 of the universal service directive. Perhaps I have missed it somewhere else, but I wanted to be sure that, in so far as a review identifies that a market is effectively competitive, it is not only the case that SMP conditions are withdrawn, but that, where appropriate, access-related and universal service obligations related to whether a market is competitive are also revoked or withdrawn by the mechanism set out in the clause.

Mr Stephen Timms (Minister of State (e-Commerce & Competitiveness), Department of Trade and Industry; East Ham, Labour)

I would like to reflect on the questions that the hon. Gentleman has raised. I may be able to respond before the end of the sitting, but if not I will drop him a line.

Question put and agreed to.

Clause 80 ordered to stand part of the Bill.